Why Employers are Rushing to Offer Unlimited Vacation
by Patrick J. Sauer
Meet three companies that implemented an unlimited vacation policy and found benefits far beyond quality suntans.
Vacations are essential. Doubly so in this era of the never-ending workweek. A 2013 study conducted by the Society for Human Resource Management found 77 percent of managers agree that employees who take all or most of their vacation time are more productive. The problem is only 25 percent of employees use their full vacation time, contributing to a burnt-out, exhausted workforce. One way to fix that? Give employees all the vacation they can handle.
Only 1 percent of American companies offer unlimited paid time-off, but it’s a policy experiment that’s being discussed more and more thanks to its success at well-known companies like Netflix, LinkedIn and Virgin. Unlimited time off allows employees freedom and flexibility to manage their schedules as opposed to a standard number-of-days system. It’s by no means a perfect one-size-fits-all solution because every company is its own unique organism, and too often, left to their own devices, Americans will choose to work as much as they can. But it’s a unique approach to getting more employees to take some R&R, which is good for both individual employees’ well-being and overall productivity.
Here are three great reasons to consider offering unlimited PTO:
1. Professionals Don’t Like Being Micromanaged
Gust does the backend work matching entrepreneurs with angel and startup investors. Founded in 2004, CEO David S. Rose says they started out with a two-week vacation policy, went to three, then switched to unlimited in 2014 with a mandated minimum of two weeks. “The value is in the production of our people, which doesn’t have to be from a desk,” he says. “You should be able to do what you need to do. If it’s checking in from the beach in Tahiti, fine by me.” Rose says that for him personally, being totally unconnected would be the opposite of relaxing — he admits taking time off isn’t his strong suit; he had to be basically kidnapped by his kids to go vacation in Ireland and still padded in three extra days of work-related speaking engagements. But the point is, he isn’t setting a standard all employees must adhere to and understands people benefit from a change of pace and context. Good employees will always get their work done and letting them schedule their own vacations makes them feel valued, trusted and responsible.
2. Vacation Leads to Innovation.
Seed&Spark is an entertainment studio with a streaming platform of diverse voices that crowdfunds productions. “Our studio runs a counter-narrative to what Hollywood has always done,” says founder and CEO Emily Best. At Seed&Spark that means letting its creative workforce do what it does best, and time off is generally less about employees taking a week in Hawaii than a week working on their passion projects. It’s essential for the company. “Our policy is: be appropriate, take care of yourself and your work,” she says. “That means letting our creative people pursue outside projects on a schedule that fits.” Shooting a film can be a lot of stops and starts, and multiple employees might be working together on it, so having to adhere to a strict vacation schedule wouldn’t fit the company’s culture. “Having a certain set amount of days off feels so gross to me,” says Best. “This way has been great for team-building, it’s made our connections stronger, and everyone feels responsible to make sure everyone gets the chance to pursue what they love. Sometimes that’s simply being able to relax and recharge.” Even at a less arts-focused company, giving employees time off to flex their creativity will help keep the workforce excited and engaged.
3. In Flexibility We Trust
It’s an old-fashioned concept in the modern age of business, but in a fast-changing economy, trust is more important than ever. At StudySoup, a peer-to-peer learning marketplace where students can upload their notes and study guides, “Having policies like unlimited vacation, based on trust, motivates employees to self-manage and to take more control over their work,” says CEO and co-founder, Sieva Kozinsky. In addition to unlimited time off, all of StudySoup’s employees are remote, and some have even moved to different cities for a temporary lifestyle change, including the boss himself. “I took advantage of our policy by spending a month in the East Village, Manhattan,” Kozinsky says. “I’m based in San Francisco most of the time, so it was a great experience and a nice change of coast.” These more-than-vacations allow for different perspectives, new ideas and deeper worldviews, which certainly doesn’t hurt in the education industry.
Unlimited vacation policies haven’t reached any sort of critical mass, so there’s no way of knowing if they’re here to stay, but a 2012 Ask.com survey found that 69 percent of respondents would be inclined to take a new job if included unlimited paid time off. Limiting employees, not too mention yourself, with a strict arbitrary we’re-keeping-tabs vacation policy might actually be counterproductive to productivity.