Unlimited paid time off (PTO) sounds like a fantasy, but the fact remains that you still need to over deliver in your day job. Not many of us manage to do that in our 9-to-5 hours, so is unlimited PTO just an HR marketing trick to coax you in the door?
In this blog, we look at the advantages and disadvantages of this policy. Should you believe the hype? What does it mean for your holiday choices? How will it work in practice? As start-up culture starts to influence big corporates, is this policy workable in a business machine with hundreds of moving parts? We consider:
Unlimited paid time off is an increasingly popular employee benefit where employers allow their people to take as much time off as they need. This can include vacation days, time off for life events or illness cover. Their productivity is prioritized, rather than the time that they spend in the office. Trust plays a key role in ensuring that this policy is used responsibly.
In practice, the phrase unlimited is not strictly true. People still need to dedicate enough of their time to their work and their bosses will ensure that they are more than busy enough to deliver on the company goals. Advanced notice of absence is often required and there is only so much flexibility to fit in with the schedules of team members and colleagues. Different companies will allow differing levels of autonomy.
While there may be an illusion of freedom, the unlimited PTO policy does bring benefits for the majority. There is nothing worse than seeing your holiday allocation tick downwards, especially when a life-changing event looms on the horizon. In fact, there are many solid business reasons for it, showing that it can bring benefits for the company bottom line.
When you can take unlimited PTO, you will feel more in control of your work/life blend. Dealing with personal matters and recharging your batteries no longer needs to take place alongside the day job. So long as you can hit your targets when you get back, that away time is so much more meaningful. We all know the stress of vacation days ticking down as the year goes on.
It follows that if you have had a good break, your time at work will be that more focused. You will give more to those around you and in return they will likely give more to you. Your time becomes a more valuable commodity when your next reset is just around the corner. Reducing low productivity could be one of the big outcomes in this push to give employees more flexibility around how they manage their working patterns.
Enjoying flexibility to react to unexpected changes in your life can reduce long-term stress and allow people to be more present at work. If you know that you can take a week off to care for a sick relative, you won’t worry about the impact so much. Many people have other commitments outside of a normal working schedule – such as education. Demands on your time are rarely constant. Sometimes you have more time to work and sometimes you really don’t.
Attracting and retaining talent will be vastly enhanced if you put the wellbeing of your employees first. An unlimited PTO system that is encouraged creates all sorts of benefits for talented employees. Why wouldn’t you want to hire someone who can do a fantastic job in less time than someone else.
When there is a sense that your employer and boss trust you to manage your workload, the resultant mutual respect can improve morale across the company. Those who use their PTO responsibly will always think about the impact on those around them, creating a bond that will carry them through many difficult times.
Unlimited paid time off can, however, be an issue if it is not properly managed. If the policy is abused by too many people, chaos can ensue.
Ambiguity and uncertainty are not helpful in the workplace. When you are never quite sure when others may take time off, it can derail confidence in projects and sow mistrust in colleagues. Someone might have a right to unlimited time off, but if there is a perception that they are working less hard, resentment can build up fast. This may lead to some people actually taking less time off than a standard holiday allocation.
Some people will always push the limits of the rules. Even a small amount of excessive time off can disturb the equilibrium. Uneven contributions amongst team members can cause resentment, especially when the low performers are the ones taking all the time off.
Some jobs are simply more suited to unlimited paid time off. Employees in high-pressure or business critical roles may feel like that are not able to take as much time off as they would wish, while those in more mundane roles would have more freedom to do so. This could cause inequalities and bad feeling to rise between colleagues.
Unlimited paid time off can cause huge ruptures in business continuity. If teams are big enough, they can weather the disruption, but for smaller start-ups (where this policy is common) it can lead to decreases in service continuity and output.
Different employers will likely have a mix of the below arrangements for holidays and time off. While there might be a strict policy at one company, others may allow you a certain degree of flexibility in your time off arrangements. Don’t be scared to ask about it, though. You will never know whether it is up for debate unless you ask.
Whenever you are looking at taking a new role, ask them about the time off arrangements and don’t be scared to dig into the details. It might be a little more complicated that it seems.
Holidays are a key part of working life. Everyone needs to switch off and recharge their batteries, but it is important that the holidays of others do not put those still working at a disadvantage. Unlimited PTO is a great benefit if it does not impact the momentum of the organization.