I like the concept, but $7,500 is an outlandish amount of money for a vacation. It also represents 5-10% of total compensation for an engineer. Plenty of people take 6 month vacations for that kind of money.
That's only true if their base salary/bonuses are $7500 below market, which I doubt is the case.
I'm not being pedantic and missing the point that you mean 'market average', because employment is not commodity purchase - so market average isn't meaningful unless you're painting with very, very broad strokes.
If you're planning on flying somewhere not near by (ie: going to another continent, far away islands, etc), plane tickets alone could cost $1k to $2k. 1 or 2 weeks in nice hotel / condo will be another $1k to $2k. Eating, activities, rental car quickly spend yet another $2k to $3k over 2 weeks.