In short, it's the veteran employees, who seem to not be using their vacation time, that are creating the perceived problem.
By taking a regression that analyzes length of tenure vs. vacation time taken in the most recently completed calendar year (2005), we can see if employees are taking more time off as they accrue more vacation days. Our hypothesis is that they are not and that there will be no correlation between length of tenure and time off taken.
The main statistic we will analyze is the coefficient of determination. According to Aczel and Sounderpandian, the coefficient of determination measures the strength of the regression relationship on a scale of zero to 1; the closer the figure is to 1, the stronger the relationship (p.457). As Aczel and Sounderpandian indicate, it is difficult to state definitively how close to 1 our coefficient of determination must be before we declare a strong relationship, but we will use their general rule that a value higher than 0.9 is considered very good; more than 0.8 is good; and more than 0.7 is satisfactory (p.459).
Results
The regression results clearly demonstrate that there is very little correlation between the amount of time an employee has been with ABC and the amount of vacation time that employee takes. The regression yielded a coefficient of determination of 0.0364, which indicates a very weak relationship.
The...
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