It seems like there's no reason companies can't do both: have an official good-as-money PTO allocation for employees, like most companies do, and have the policy that employees can take any reasonable number of vacation days. That policy works exactly like "unlimited vacation", while also (a) maintaining a minimum annual number of days that every employee is entitled to, regardless of how their team is managed, and (b) provides a fair cash payout when the employee leaves.
This may be all the author is arguing for; I can't quite tell.
Unless there's some legal reason this policy can't work, the absence of a formal allocation of vacation days in an "unlimited vacation" policy would fail a sniff test for me --- your policy might be "unlimited" as a devious way of not committing to any particular number of vacation days.
(Full disclosure: we just do a normal accrued vacation day policy.)
I think that particularly in the Valley it often ends up essentially exploiting the crush-code-with-your-forehead-after-70-hour-weeks culture and young employees who have not yet learned appropriate boundary setting. People would catch on a lot quicker if it were called "unlimited salary." I mean, sure, you can have as much money as you want... but dude, $3k? What do you need $3k for? Your rent is only $2.5k and we give you free soda? $3k? We all take $2.8k, bro. What's up with that?
> have an official good-as-money PTO allocation for employees, like most companies do, and have the policy that employees can take any reasonable number of vacation days.
This is google's policy except that the latter bucket is non-vacation time off. Vacation -- time off work for your own enjoyment -- is tracked using regular PTO.
If you're sick, need to wait for a delivery, have a dentist's appointment, had some errands run long, etc., that's all untracked.
I really like the policy. If vacation was untracked, what that means is that it would be effectively be socially tracked. There would be informal mores about how much you can take, and people would spend time observing how much their coworkers take to get an idea of what an "OK" amount is. I think that would be stressful and likely lead to vacation shaming.
At the same time, it really makes my life simpler to be able to schedule appointments whenever it's convenient and not have to worry about "stealing" time from work or having to think about burning PTO on it. In practice, I haven't seen abuse of the policy.
This is how most exempt jobs work in the US. Paid vacation but untracked personal time. generally speaking, untracked overtime offsets the cash value of the benefit, which is sort of the point.
Yes, that seems like a good solution that anyone could figure out in about 5 minutes. So why do companies go with "unlimited" vacation instead? Because its just a money saving scam. If the company doesn't specify an exact amount of vacation then they don't have to carry it as a liability on their books. Hence the name "unlimited" which really just means "unspecified". Startups especially like it because accrued vacation money must be set aside leaving leaving less runway.
It completely screws the employee because vacation was actually money that had to be paid out if they left. So the employee is out that money, usually at a time they need it most. Getting fired with 8 weeks vacation banked it not nearly as risky as 0 weeks.
Unlimited vacation is a somewhat-mislabeled thing because the benefit obviously is not that you could take unlimited time off. Instead, the benefit is that you don't have to think about it. That day you take off somewhat spontaneously because some friends or family members came into town? You don't have to think about if it'll affect your banked vacation hours w.r.t. that big trip you were planning on taking. That week you were home sick because of a nasty flu? Again, not taking anything away from anything else (I think shared vacation+sick PTO pools are just about the worst policy I could imagine).
It requires you to be a mature adult about it, and not take off huge amounts of time that put the rest of your team into bad situations, or disappear for long trips on short notice, or such, or the company will have to address that. And the company has to have management willing to address edge cases or abuses rationally.
But it's pretty awesome if you're working with mature adults who don't take advantage of the system on either end (to take excessive time off OR to try to keep employees from taking adequate time off).
And at my current employer I do accrue some regular, paid-out-on-leaving-but-never-deducted-from "vacation" hours too. So that's extra nice. I didn't have this part of it at the company where I was previously, but frankly I wouldn't want to go back to tracked vacation even in exchange for that accrual (maybe with the exception if I expected to stay somewhere for decades and they had unlimited accrual...).
> Instead, the benefit is that you don't have to think about it.
But that benefit is in no way realized. The opposite is clearly true. With a set number of vacation days, it's incredibly easy to know how many days I have remaining, and it's fairly easy to pre-plan extended vacations while leaving some days for spontaneous breaks. With "unlimited" days, I have to essentially guess whether or not I'm "abusing" the system.
Compare it to another employment benefit: salary. What if a company offered "unlimited salary"? You could say it's great, because you don't have to think about whether you can afford a neat guitar you spontaneously found on craigslist, while still being able to pay for rent and other fixed costs. But with a fixed salary, assuming you have a decent job with a "living wage," it's pretty easy to balance how much you spend on fixed costs with how much disposable income you want for spontaneous purchases.
I think most people would have no problem recognizing the ludicrousness of an "unlimited salary" policy.
For me this comparison falls apart because I've seen very few companies as generous with vacation days as with salary, compared with the two companies in a row I've now been at with unlimited policies. I rarely see more than 3 weeks offered for new employees, and many feel that that's generous ("it's more than two"). So I'm not comparing it to a generous metered vacation policy, I'm comparing it to what I usually see for "peer"-type roles. And I haven't had any trouble whatsoever taking more than 3 weeks, or seen other people get into hot water over it. :)
So the benefit is definitely realized for me. I don't think about it. I couldn't tell you exactly how many days I took off with all the incidental ones here and there, but I can tell you it's more than I was allowed to at my first job because there were enough larger, multi-day trips in there.
I would have no problem if they instead switched it to, say, five weeks + a separate generous sick time pool, but at that point the math also gets more messy with accrual and all since that money would be coming from somewhere... and frankly, I like that I don't make relatively less money because someone else was a workaholic and accrued a bunch of vacation they never take but will eventually get paid for, if I can be at my most productive with a healthy amount of time off.
It is a downside, though, in that it may require some more negotiation skills to make sure you get a fair amount of time off. However, I've also seen people get denied time off at certain times under metered plans—they're no panacea for "but it's crunch time for the project, you can't take off now!" tactics.
There's a solution for that, though. Just like a minimum wage, allow for a minimum vacation. IIRC Europe does exactly this, specifying a given number of days that non-temporary workers have to be given off.
Unlimited vacation is not a benefit to the employee, but to the employer who can socially limit vacations (isn't the standard 3 weeks too much?) AND can use fuzzy accounting that prevents being paid for unused vacation on termination or carrying over vacation between years (I have about five weeks right now, with a lot carried over from last year).
I laugh when a company mentions "unlimited vacation" as a benefit as if it was a good thing for the employee and not something they were doi as a cost cutting measure that absolutely does not benefit the employees. It should be illegal to do vacation that way, it is definitely unethical.
'Unlimited' vacation is the biggest BS trend ever. How is it unlimited? Can I take 365/6 days a year off?
No? Well - then it's NOT unlimited, is it?
Can I take 100 days off? No - most likely I'll lose my job then.
How about 50 days? Can I take 50 off? Nope. Highly doubt I'd still be part of the team/company then.
How about 20? That's not much, right? Little 4 week vacation in SE Asia or so? No? We have deadline? Team 'depends' on me?
Hm...
The Netflix slide deck makes it clear that the company seeks to reward performance only, not poor proxies for performance like number of days worked. So if you took 100 days off, yet were still as useful to the team as the guy who didn't take any, you'd be treated the same way as him in reviews.
Whether this is possible is up to you. Also, having not worked at Netflix or Heroku, I can't speak to how well it works out in practice.
The problem is that it is often very hard even for experienced managers to guess how long a software development task should take. So you do end up measuring proxies such as how many hours a day you have been working, plus your reputation and so on.
Estimation is hard, but, In most places I worked, after a couple of days it was very obvious which people were the solid contributors and which people were just along for the ride. Granted, those jobs were in the trenches where I was working along side people so I would see what they were doing day in and out, but I think that if you're a programmer, it's pretty obvious whose productive and who isn't.
If there is a candid performance tracking system in place, I don't think any of our complaints about vacation policy would hold. But a candid performance tracking system is probably at least as difficult to implement as an "unlimited" vacation policy. How do you quantify individual performance? How do you decide what the minimum acceptable performance is? What do you do if one employee has 1.5x the performance of another?
Exactly I couldn't agree more. In a computer sense. Hopefully everyone knows that the lines of code is a bad metric. The number of bugs is a bad metric. Number of new features is a bad metric. Meetings attended another bad metric.
In the world most people in HN lives in. Most metrics are Mediocre at best. There is always a struggle to define quality and quantity of work.
I agree that "untracked" is probably the better term. The point of such policies is that if you need to take say, 90 days off because of family issues, the official company policy stipulates that this is ok to do.
If this had happened in a company with a fixed e.g 20 day vacation policy, then the outcome depends on your manager. Now, many would have no issue giving the extra time off "unofficially" in such cases, but there are also many who might deny that request - see other example in this thread about a company denying an extra 1 day of vacation!
This policy is a way to empower employees against such managers. Now, there are several other downsides to this policy, as OP has pointed out, and as I've witnessed first-hand as well, but unlimited/untracked vacation policies certainly merit a discussion vs. outright dismissal.
> if you need to take say, 90 days off because of family issues, the official company policy stipulates that this is ok to do.
Depending on the nature of the family issues, in the US they're required to by the Family and Medical Leave Act (http://www.dol.gov/whd/fmla/)
> 20 day vacation policy
In my experience in California, 20 days is pretty generous. Most companies with vacation policies start you at two work weeks per year, not including sick days. While this increases slightly with seniority in larger companies, tech companies tend to have high turnover so seniority is kind of meaningless
> This policy is a way to empower employees against such managers
Other than some high profile large companies, most companies that I'm aware of with untracked vacation are small. The manager/employee dynamic at small companies is very different and the manager and employee have little empowerment over each other at all (in both a good and bad way)
Personally, I'm at a small company with untracked vacation and it creates a lot of social pressure not to use it. Some is imagined pressure in that it it turns it into a "can I take..." favour-type question instead of "I'm taking..." declarative form to fill out, but also real pressure in that the small-team dynamic means that I know personally everyone that will be inconvenienced by my not being around. This gives them a sort of social veto power that does happen in real life anywhere near an event like a release. Since no company is sitting around doing nothing all of the time, there's always a release of some sort on the visible horizon and of course those have "real" veto power rather than just social.
It also creates a significant disparity in how much employees at the same company take. Some employees feel the social pressure and don't take any, and some seem to not feel it and never seem to be around. IME vacation taken tends to be inversely correlated to general employee quality which is exactly the opposite of what you want.
As a result, I probably take half the vacation I could if I just knew the magic "okay" number to take and generally only for something that I can articulate like a trip somewhere or because family is in town. When I had tracked vacation, I'd take off an arbitrary Friday to sleep in or run the errand queue or just hang out. Now I don't do that and the difference in mood that creates is palpable.
I didn't think that burnout was real until I got "unlimited" vacation.
It's not a BS trend at all, maybe phrased incorrectly using the term "unlimited", but it's actually a great benefit if you're capable of understanding that there are socially acceptable limits to these "no policy" benefits and that timing long vacations takes planning around your work load. Getting ready to ship a big feature or tool? Maybe once it's been in prod for a week it's a good time to take off for a couple weeks before you get tossed into the next big thing. Let the PM's know you're going to be out so they can schedule around your absence and it's not going to be a big deal. Obviously, the company has expectations about your availability, but also respects your need for a work-life balance. So, you have to be the kind of person who is aware of whats going on around them, what your needs are and what the company's needs are, and finding a balance. "No vacation policy" is not an all-you-can-eat buffet.
This is like Unlimited Webhosting. It is unlimited as long as you are within limits set by board that you cannot know what exactly they are. It is extremely confusing.
Better yet - just do 1 week mandatory holiday every 3 months. This way all employees would get fair amount of holidays, they would not take long leaves hurting company workflow and would allow employees to recharge batteries every quarter. Not only you would get rid of people abusing holiday system, but also get workaholics to leave the office for 7 days every 3 months with de-activated entry card so they couldn't just "pop in" for some documents etc. If there is deadline you are worried about - then work late for few days but take freaking holidays. Spend some time with kids. Travel. Sort your issues and re-think your work strategy from safety of house.
If the vacation is "unlimited" at my company and I end up taking 3 weeks off in a year, and your company gives you two weeks per year, who's the sucker -- Me? Because the nominally unlimited vacation is not actually literally unlimited?
We have unlimited vacation at Rentify. Actually the policy is "take enough vacation to avoid burnout, we don't count the days". The expectation established when people join is that if work is being done, we don't care if you take a few extra days of vacation.
The policy exists because I was once declined an extra vacation day by a company I worked at which meant I had to take a flight costing an additional $150. The extra day they got out of me in the office was my least productive day of all time.
Vacation time is still approved by a line manager and is occasionally still declined. Generally people act in the company's best interests but sometimes we have to give context on why we can't allow a holiday.
The policy gets tricky when people leave the business, because we have to have a formula to explain to them what the calculation is for their remaining holiday pay. We try to be generous here and not simply take the UK statutory minimum (iirc 28 days). One person asked for ∞ accrued vacation days to be paid back to them which gave us a fun conversation about the difference between "infinite" and "unlimited".
"Generally people act in the company's best interests"
This is exactly the reason this policy is bad. People need to act in their own interest and take vacation they need, which may not be in the company's best interest.
Your language here is a huge red flag for this policy. This policy presumes, incorrectly, that what is good the employee is good for the company. While that is sometimes true, it is often not true.
The basic premise and expectation is that people should take only as much time off as they need to remain good little not burnt out workers. That is not something I agree with.
While it may almost always be in the company's interest to have employees well rested, sometimes employees want to schedule vacation that can't be rescheduled at a particular time that may coincide with an important deadline.
In this situation, you run into some awkwardness that could screw over the employee.
Yes, it is "almost always in the company's best interest for employees to be well rested and not burned out."
However it is not almost always in the company's interest for employees to take 2 week recreational holidays when they are NOT burnt out. A normal vacation policy allows this, whereas a "no-burn-out" policy does not.
> This is exactly the reason this policy is bad. People need to act in their own interest and take vacation they need, which may not be in the company's best interest.
Heh, 'take enough vacation days to avoid burnout'. In other words, take as much time off as you need in order to keep working efficiently for us and so that we don't need to train someone new, but no more.
If you don't count the days, how do you make sure that people are taking/compensated for the statutory minimum - or do you mean "we count the days, but we don't say no just because your count is above a specific number"?
That's still not a satisfying policy. It doesn't fix any of the potential problems in this article. "Enough to avoid burnout" and "as long as work is being done" aren't well-defined terms. If I work one day a month at Rentify, work will get done, and I'll avoid burnout, but I suspect I will be fired.
I often found it discouraging to contemplate how much time and energy is spent thinking and arguing about PTO (paid time off) policies. It turns everyone into a FlyerTalk forum member. Worrying about how to game the system, or prevent it from being gamed. Worrying that someone else is getting a better deal. It's a huge time and morale suck.
Sometimes I wonder how much of the problem is the "P" in PTO. When you're paid not to work, you're effectively getting a bonus -- being paid more for the time you do work. This also makes it a hot button for labor law -- if you leave with unused PTO, you need to be paid for it. Because it was never really about the time off. It was about the money.
Instead, what about simply having "UTO" -- unpaid time off? Take as much time as you need or want. Everyone will understand you're not getting something "extra" they're not getting. You're simply choosing to work somewhat less and to be paid somewhat less.
And to be clear, if an organization switched from PTO to UTO, they should give a one-time equivalent raise to make people whole.
I definitely don't claim this will resolve all the issues (humans in an organization will always find something upsetting). But wouldn't it eliminate a very big chunk of the ill will?
I had a job in college that basically worked like that. (Technically I was a contractor). The idea was, I'd bill them for hours I worked, but since I was a student there was an understanding that some weeks I'd work more or less. I thought that system was GREAT for both parties. It was nice to be able to dial things back when I was stressed without feeling guilty about working only 20 hours or whatever, and my managers didn't have to worry about if I was working "hard enough". There was no concept of "vacation" because if I didn't want to work that week, I'd just send an email saying "I'm out for a bit".
The other thing is that being a salaried employee, I really hate the subtle implications in every communication that the company "owns" you (I mean obviously not really, but most things are phrased in a master-servant sort of context), or that you're "part" of a larger corporate "family". Fuck that. I'm here because you give me money. I probably like the people I work with, but I really have no interest in having the company I work for be a significant part of my identity. I actually like the contractor setup better, as I never really felt like where I worked was some important part of my identity, and I generally would like to keep the relationship casual.
A UTO plan sounds enticing, but it wouldn't address individuals who are reluctant to take time off at all, leading to burnout. This is listed as Jacob's first "Con."
Perhaps a combination? A minimum number of annually expiring PTO days, with an open policy of UTO beyond that?
I agree this would be a major problem. It's one of the biggest problems listed with unlimited vacation, and that's when you're still getting money for it.
I think the underlying problem is the conflation of hours worked with value to the company. I think most people will be more productive for a company working reasonable hours for at most 50 weeks a year than working all 52 (minus holidays in both cases).
Accordingly, I think it is appropriate for a company to pay you to not work some of the time. I think that fits with your suggestion pretty well: give an employee 4 weeks PTO (or whatever you think will optimize their productivity and happiness), with the option to take more UTO that might not be an upside for the company.
edit: There should probably still be some reasonable cap on the additional UTO. Not pay their salary during vacation still doesn't account for fixed costs like health insurance and office space. In practice I don't think most people would take enough UTO for this to be a real issue, especially with the work culture in the U.S.
> Your pay is not tied to how many hours you work as we are overwelmingly talking about sallried profesionals on HN.
Maybe not hours. But definitely some unit. There is always a pay rate, whether the denominator is "hour" or "month" or "year".
PTO is a way to diddle the denominator -- a way of saying that a "year" isn't 52 weeks, it's 50 (or 46 or whatever) -- without changing the numerator. It increases the rate, but not how much money you get.
UTO just keeps the rate fixed.
Admittedly PTO is better HR "marketing" or "optics" -- the company and/or politician can say they're "paying you even when you're not working", which sounds wonderful. Yet people burn time worrying about how it works, and is it fair. And the economic reality is you're only getting paid for working.
Admittedly I don't know if UTO would actually help. It may be the case that people inclined to agonize over HR stuff or game the system will still find a way.
You are conflating a pay schedule with a pay rate. The GP's point is that a salary is meant to be a fixed pay schedule where competing your duties to your enployer's satisfaction entitles you to continue getting paid an agreed-upon amount on a defined schedule. If it's metered by time, that's really just an hourly worker with a multiplier on his punchcard.
Just offering unpaid time off would mean people who are tight on money would take exactly 0 days off. Because at the end of the month your paycheck is going to be that many days smaller.
Unpaid time off is an interesting approach, but companies generally consider Unpaid time off not as neutral, but as a loss (due to missed opportunities, rent, and equipment cost).
We have a pretty flexible vacation policy and I've observed one person (no longer with the company) who was pretty abusive of that policy. That persons behavior definitely had a negative effect on other's perception of them.
There is a certain type of person who will push the limit for the limit's sake. And they will inspired others to push it. Have you sat in a line of cars with a shoulder open, when somebody decides "hey I'm just going to pass everyone on the shoulder" and once they decide that a bunch of other people jump out into the shoulder because they don't want to be "chumps" waiting while some "not chump" gets away with driving on the shoulder? Group dynamics can have a huge effect on these sorts of policies (for good and bad).
We're essentially swapping simple guidelines for a test of people's ability to correctly judge social mores.
There's an ideal number of days of vacation per year.
We aren't going to tell you what that is, but if you guess incorrectly, everyone will hate you.
Good luck!
This is why I also prefer signs on the road saying either "stay in your lane" or "merge now." Why coordinate behavior by instinct when we have all these nice methods of communication?
Did anyone warn that employee that they were considered to be abusing the policy? If not, then that's horrible, and I won't blame that employee at all. If so, then why not count how many days of vacation that employee took before it was considered abuse, and just set that as the vacation policy?
Yes, agreed. If you have unlimited vacation it shouldn't really make sense to talk about someone "abusing" the policy. You might say that someone takes so much vacation that they don't actually contribute any value to the company, that would make sense to me. There are lots of ways of failing to contribute value, and that would be one of them.
Before I moved to California, I lived in a state where passing in the breakdown lane (during certain hours) was permitted. I had coworkers who were unaware of this rule and felt those passing were "jerks". Even explaining that it wasn't illegal, they still felt they were "jerks" for not waiting with everyone else...
I guess it's similar to lane splitting by motorcycles. Moving from a state where this is illegal to one where it's legal was a shock (although I see a ton of people lane splitting at insanely dangerous speeds...)
Beijing China speaking, ya it does work. The black Audi's use the breakdown lane often to get around traffic, it's dangerous and they don't get tickets.
Article advises setting policies about what is normal, and then tracking. How does this resemble an 'unlimited' policy in any way? It's nearly what we have at every company now: a company vacation policy.
No, instead I'd advise setting a vacation minimum ("Everybody has to chill for 2 weeks minimum!"), then saying "take more if family contingencies come up" such as debate tournaments, sick parent etc.
Financial companies force certain employees to take 2 uninterrupted weeks off. This is to reduce fraud--to get the employee out of the system so they auditors can look for irregularities. But if course it's a great way to force otherwise driven people to check out for long enough to reduce burnout.
Some companies also close entirely at times--usually the week between Christmas and New Years, but I have heard of a few places that pick a week in the spring or summer to close.
Has any company with "unlimited" but tracked vacation actually revealed how many days their staff take? And what disparities there are between individuals and departments?
I'd bet that it's overall _less_ time than companies where vacation is metered, but compulsory. e.g. mine in the UK is 25 to 32 days depending on time at the company, plus bank holidays, and you've got to take it.
Peer pressure must conspire to _reduce_ what people take, especially in companies that do "360 degree" peer reviews. And it would only take a hint of management pressure to make staff feel guilty about booking holidays (or cancelling those that they'd already booked).
For me "unlimited holidays" translates to "unlimited work hours", and I'd be suspicious of companies that promote it as a perk.
I don't know of any official revelation but I did get a little insight into the amount of vacation taken at the company I work for when I had taken 'significantly more' vacation than the rest of my coworkers.
The most anyone else took was around the 4 weeks mark. I had taken a little over 6 weeks and that was the upper limit that had my boss telling me I was taking too much vacation. I felt a little shafted by than since my last job was 5 weeks + sick time + bank holidays.
So that's not a lot of information for you but that would confirm your suspicion that it is less. That said it does not translate to unlimited work hours but our work is contract work. We get contracted out to other companies so though we are expected to get the work done and sometimes work >8 hours the expectation is that it will average out to 8hours a day. Be it 4hours one day followed by two 10 hours days or what have you.
I work for a company that offers unlimited vacation, and I am skeptical of the skepticism around this. To me it feels like some kind of backdoor justification for the standard, shitty two weeks most American firms offer. While I certainly agree that unlimited vacation can become a defacto way to prevent employees from leaving at all, why would you work at a place that does that to their employees?
In the case of my company, it's a long-standing practice and works very well. People just say they're not gonna be around, and then they aren't. There's no grousing about who takes too much time off. That actually would be working against one's own interests -- I don't bitch about people taking time off because I want to take time off too. (And yes, people can take really really long vacations to pray on a mountain in India or whatever)
I agree about the decoupling of unlimited and untracked, though. It could be useful to have numbers about who takes how much time, as long as it's used to encourage people who are working too hard to take time off, and not in the other direction.
I think a company thinking of offering this benefit should make sure they really mean it. Because if they don't, that's where all the trouble starts. You probably need to be big enough to be in a position where Steve or Grace can take a week or two off without dire consequences. High bus numbers.
My experience with unlimited time off is that it almost always still needs to be approved by your superior so whether it works or not depends on her. This is means you can have widely varied results. I like your suggestions but they inch closer to just having a set policy on PTO. So my suggestion is just be generous with PTO but have a limit. If you don't have a set limit then people who are intimidated by their superior will always ask for too little PTO. Set the social norm in your company and don't make it so up in the air.
Open vacation policies kind of feel like the theory behind offices with cubicals and open office spaces. Open offices and cubicals were originally created to encourage collaboration between employees by tearing down walls between people. Sounds good right! In practice this doesn't work because people are scared of being too loud or of interrupting other employees. I worked in an open office for a while, and it was horrible. It was such a boring place because everyone was trying to be so polite not to make noise for others.
I would love to see some numbers on whether open vacation policies encourage or discourage people to take more vacation. It may be positive now, but I have a feeling as it gets implemented by bigger companies it will turn into the cubical of our generation. Office Space 2, The Endless Vacation? You heard it hear first!
I would do a simplified minimal french system: five week paid, and if you want more, it's unpaid. The boss approves the vacation, but in a collective code ownership, that helps the bus size.
It depends on the jurisdiction, but a lot of the "guideline amount + tracking" philosophy is driven by the law (and financial accounting).
For example, here's an except from some guidelines around the Ontario Employment Standards Act:
Employers are required to keep records of the vacation time earned since the date of hire but not taken before the start of the vacation entitlement year, the vacation time earned and vacation time taken (if any) during the vacation entitlement year (or stub period), and the balance of vacation time remaining at the end of the vacation entitlement year (or stub period).
So at least in Ontario, your employer is legally obligated to record your vacation time each year, and on demand, produce a report on it. There are also rules around when an employee has to take their vacation by, for example:
The vacation time earned with respect to a completed vacation entitlement year or a stub period must be taken within 10 months following the completion of the vacation entitlement year or stub period. The employer has the right to schedule vacation as well as an obligation to ensure the vacation time is scheduled and taken before the end of that ten-month period.
Since Ontario is also a jurisdiction with legally-mandated vacation time, at any point in time the vacation that an employee has accrued but not yet taken (or has rolled over from another year) should also be recorded as a liability on a company's books, since it could be forced to pay out the equivalent vacation pay (if the employee leaves, for example). The obvious way to get around this - and I've seen it done in a few places - is to pay everyone their full statutory vacation pay every year and then not count the vacation days taken, but that's basically giving everyone a 4% raise, and isn't even an option in some jurisdictions.
All of this is to say that unlimited and untracked vacations may not even be a legal option everywhere, regardless of what we think of them.
I doubt unlimited vacation is legal anywhere but the United States where our labor and employee wellness laws are much weaker than in the rest of the developed world.
"Unlimited vacation" is largely an accounting trick. Unused PTO is an accrued liability on a balance sheet. By replacing PTO with "unlimited vacation", companies are simply eliminating this liability from their balance sheets. When you have a large, highly-paid workforce, this adds up.
My last two companies have offered or will shortly offer this benefit. I read the Netflix benefits deck a while ago and mention it frequently in conversations with colleagues.
One benefit to this policy that goes unmentioned is the decrease in friction in tracking PTO. In previous companies, I've had to find a PTO form, fill it out, submit to manager for signature, submit that to Payroll/HR for tracking and then finally take the time off. Payroll/HR has had to submit this number to ADP who has had to track it on my paystubbs. My manager has had to track my vacation and make sure I wasn't taking off without filling out the forms. When I left, we had to reconcile PTO banked but not taken and pay that out.
With an "unlimited" vacation policy, all that friction, or at least most of it is gone.
The one part about PTO I strongly dislike is getting "approval." If PTO is offered as part of your job, you shouldn't need approval to take it. Notice, yes, sure. Letting your team know you will be out is just good professional ethics and behavior. But requiring your manager to "approve" has always bothered me.
I was never a huge fan of taking full days off weeks in advance. I've always preferred half days off. Some places won't always let you do this but my last job of 5 years. Let me go home on a 1 minute notice or email my boss in the morning that'd I'd be taking a half day off. Coming in late or not at all. This was discussed with him beforehand and he did the same with his boss. I was only give about 2-3 weeks total a year and I was always ahead on my work and never did it during busier crunch like times. I can't imagine having to fill out that kind of paperwork to take time off. That just sounds miserable.
Where I worked agreed with your statement. It's your assigned pto. You can take it anytime you want because that's what it's their for. Obviously everyone was ethical and respectful of timing. But it was a very relaxed and low stress work environment with the ideal that the work will be done when it gets done.
In two companies I worked at it was completely automated. You go to some web page, change status and click Submit. Your manager gets email (no signing/confirmation required) and that's it - no manual steps. You can see how much vacation time left on the same web page.
This is a great article with some interesting proposals. It mirrors my experience with the "unlimited" vacation policy at my cargo-cult startup employer quite strongly.
The article didn't touch on one of the biggest selling points for pseudo-unlimited vacation policies at startups: It frees the company from having to account for and, depending on state laws, compensate employees for unused vacation time. Unused vacation time is a financial liability in many circumstances, so pretending you don't track vacation time frees you from owing employees any extra compensation when they leave.
Also, it makes your job offers appear more attractive in comparison to other companies' offers. Unlimited vacation time, in theory, is more desirable than even a generous offer with 5 weeks of vacation time. Unlimited > limited. In theory.
Honestly, after deeply burning out within a company with a supposedly unlimited vacation policy, I wish we had just had a defined and tracked vacation policy. We're allowed unlimited vacation, as long as we don't have any big outstanding tasks to finish. The catch is that we're a startup trying to accomplish too much with too few people, so everyone is always too busy to take vacation.
This has all sorts of unexpected consequences that leave the company worse off in the long run. Smart employees quickly learn that taking on new responsibilities will quickly lock them out of taking vacation time. The solution? Don't take on new responsibilities so you can justify vacation time when you need to.
Meanwhile, a few bad apples will always exploit the unlimited vacation policy, leaving the remaining employees with more work. Naturally, this makes the remaining employees even less able to take the vacation they need. To make matters worse, management responded by strongly and publicly discouraging any use of vacation rather than addressing the few people who abuse the system.
Compounding our problems, the new unspoken anti-vacation sentiment from management drives everyone to conceal their vacation plans until the last minute. If you announce your intent to take vacation a month from now, that gives management an entire month to come up with reasons to deny your vacation. But if you announce on Thursday that you'll be out all next week and the flights are already booked, there isn't much that can be done. As a result, we have to scramble to make ends meet every time someone disappears for 1-3 weeks without notice. And of course, management tightens the strings even further on anyone who formally asks for vacation time in advance because we're already short-handed due to other's vacation.
Finally, the unlimited vacation policy is strongly at odds with our management's strong stance against any form of working from home. Those of us who aren't disappearing at the last minute for 3 week vacations to foreign countries have attempted to alleviate the resulting burnout by working from home a few days per week. Management clamped down on that as well, demanding that we spend our days physically in the office. As a result, it's now more advantageous to not work at all than it is to work from home for a couple days each week because working from home is taboo while spontaneous unlimited vacation doesn't actually conflict with policy.
Burn out abounds. Those who need vacations never have the opportunity to take it or feel too guilty to force it. Those who need to work harder are M.I.A. all the time. Employees are choosing to switch companies or quit outright as the strings are tightened further on working from home or actually taking time off.
In short, poor management and the resulting unintended consequences and misaligned incentives from a poorly executed unlimited vacation policy can have disastrous effects on the well-being of the team. Like any management-style fad, it must be implemented with attention to the details. Cargo-cult implementation that cherry-picks only the pieces that are convenient to the company (no tracking, better sounding offers, less financial liability) will quickly burn out employees as the unfair elements of the system come to dominate. This article has some interesting suggestions that I would love to see implemented by my company, though.
As a relatively recent graduate now working for a startup with an unlimited vacation policy, I find there are a whole slew of other uncertainties related to unlimited vacation.
Am I expected to take as much time off as the 20-year industry veteran? Is that equitable? What if he only takes one week per year?
As a recent hire, when is the socially-acceptable first time to take a long vacation? Not the first month, certainly, but what about after three months? Six? A year?
In my first four months at the company, I have seen one employee take two days off. I live in a city with bitterly cold winters, so I understand many vacations are taken during the summer months, but I find it hard to believe the average vacation time per employee will exceed two weeks per year. Unfortunately, I would prefer to take more than that (3-4), but I don't want to be seen as lazy or less invested in the company than everyone else.
I love the flexibility of unlimited vacation, but I find the lack of consistency or limits to be mentally draining.
I wonder if we're going to eventually wind up with policies similar to commercial aircraft crews. Like, for every N weeks of work you are required to take Y time off. It seems like the logical endgame (even though I hate vacations, and would be annoyed by being required to take them).
I don't think that the companies who are advertising unlimited vacation are doing so as a way to covertly pressure their employees to not take vacation; even if it might be having that effect unintentionally. Or maybe some are, but I can give most of them the benefit of the doubt.
I still have this nagging feeling in the back of my head that the eventual makeup of businesses is a sea of 1099's, self-organizing around particular projects and then dissolving at the project's conclusion. People seem to have way too adversarial a view of employers for this not to seem like the future.
I find it an unnecessary gimmick that leads to complications (some of them mentioned in the article), especially in countries that already have a considerable amount tightly regulated vacation days. (I.e., every Western country besides the US.). For instance the legal obligation to pay out remaining vacation days if someone leaves means you have agree on a number and keep track of them.
In practice, 25 days vacation (with the option to save at least some of them up over time) is more than enough for most people, and you'll be hard pressed getting most motivated workers to actually use them all up.
Especially if you are a decent employer that allows people to work from home if convenient and doesn't deduct vacation time for trivial matters.
I think I'd be happiest with 4-12 weeks of "vacation" per year, but in a way which is minimally disruptive to the company. This isn't necessarily part of the "unlimited" aspect of vacation, but can be related.
1) Flexibility to take short vacations whenever there isn't anything to be done at work. This doesn't often happen in an early startup, but it's not too uncommon in a larger company to have a day or two where there is some external block. If you can work from home or otherwise be on email, there's no particular reason to just sit in the office that day.
2) I personally count most conferences, even when speaking, as vacation -- even if the company is paying expenses. Essentially, if it's something I'd go to myself, I'm happy to be going on the company dime, and it serves a lot of the purpose of vacation.
3) When long distance travel is involved, I'd usually strongly prefer to take a day or two before/after as vacation, particularly if it's somewhere interesting (which, for me, could be a lot of places). Sometimes this is at employee expense, but there are a lot of cases in consulting where flying someone back for the weekend is more expensive than paying for a weekend hotel. "Be reasonable" seems like the best policy for the expense part, but if you don't have kids or another reason to go home on the weekend, why not spend the weekend in Berlin or LA or something? (relatedly, I'm willing to use my frequent flyer miles to help the company on travel when it's expensive, in exchange for getting to use preferred carriers when the price isn't unreasonable.)
4) In ops, it's often useful to have people show up on weekends (for a consumer service, sure, you can push updates on Tuesday at 9am, but for enterprise stuff, weekend upgrades are actually pretty common); offering 1:1 comp time for that is the baseline, but I'd probably go to 2:1 or 3:1. Similarly with covering emergencies (higher premium if unscheduled) or holidays (I personally love working on most holidays, but if I had to get someone else to do it, I'd expect to pay at least 3 days of vacation per day).
The big problem of unlimited is that those who need it the most take it the less. If they want to go all in, why not just give 6 weeks of vacation + unlimited paid sick days? This gives everyone a healthy time off without the problems of fairness.
A former large corporate employer of mine switched to this, a did this a while ago, and it was clearly a thinly veiled way to replace actual PTO and recuperative time with the odd extra three-day weekend. The H1 staff weren't going to complain about it - they just waited until they had a critical mass before switching to this.
I'd be equally critical of a start up that offered unlimited vacations. The idea of there being a 'good time to take a break' runs directly contrary to most start up's raison d'etre, and strikes me as equally disingenuous.
He advocates tracking so everyone can take equal amounts...that kind of removes the whole point of people taking as much as they need, which will be different for everyone. I think he completely misses the concept that the manager right above the employee is going to see everything and talk to the employee if there is a performance problem anyway. It's not like you can fire someone without paperwork indicating that anyway nowadays.
I wonder what would happen if vacation time were tracked and made public (within the company). I'm sure outliers would come under social pressure to conform to group norms, but it'd be interesting to see where the norm stabilized. It probably depends a lot on other aspects of company culture.
Why not educate potential employees on how they should utilize unlimited PTO? This could be taught in school or some other non-biased source. If people aren't taught how to utilize their PTO (or vacation days for that matter), then there will always be the option for abuse.
It's an interesting statement that something as completely awesome as unlimited time off whenever you want can be turned into a negative. I mean people in other sectors would kill for this. Yet here it's viewed as a potential tool of sxploitation. I think this is a symptom of a much bigger problem worth discussing. If I state unequivocally that there is an open ended no asterisk vacation policy and you say "you need to go further than that" am I really the one with the problem? Or do you need to look inward a little more and ask if you're at the right company/industry etc
Did you read the article? There are clear examples of how it could very much be a negative, including it causing people to take very little vacation time, and enabling managers to discriminate against minorities or other groups.
I read it thoroughly. Ask yourself two questions. I) if your company discriminates or exploits its workforce you've got bigger problems than set time vs unlimited. II) it confuses causation. Companies with set time off will still discriminate against employees if that's their DNA. So your back at "hey If my company gives unlimited time off and I still feel uncomfortable maybe I need to make a change" vs going on and on with ever more tweaks.
Discrimination can happen unintentionally, and it doesn't have to be limited to specific groups of people. A manager could have a rough month due to some family issues, and end up turning down more vacation requests during that month. That sort of thing. If you have a set number of vacation days, it becomes a lot harder to unintentionally discriminate, and a lot easier to notice intentional discrimination.
unlimited PTO is saying that "we would like to give you something that you can't potentially use". the sad reality is that in countries like France or Brazil where you have 30 days, it is actually guaranteed that you can take that many days off, while unlimited PTO startup employees end up using 10-15 days per year of the "unlimited PTO". it is like a bait to get more people to work for them without actually giving anything. I would argue that we need 4 days work weeks that would be fair. The reason why we have 5 days is purely based on the greed of the corporations. if i open my startup I am going to offer 4 days workweeks instead of unlimited PTO, that is a better way to respect your employees that giving a useless bait.
This is in stark contrast to the trend of lumping both sick time and time off into a single limited “PTO” bucket. Having an unlimited budget of time off means you don’t have to worry about “banking” time in case you get sick.
Those policies are fucked-up. It's Enron-style accounting, a way for a company to say, "we offer 15 days off" while lying through its fucking teeth. Counting sick days against vacation is evil. By effectively forcing people to come into work when ill and making the whole office sick, they're fucking with my health (and everyone's, most of all the people who are already sick and deserve rest).
Companies that have that pooled "PTO" bucket end up with people getting more colds because sick people come in to work. So, even though people are in the office more days, nothing gets done all winter. Like most mean-spirited HR policies, the bulk effect on productivity is negative, but it enables HR douches to look like they're saving money while externalizing costs to the rest of the company.
Whoever came up with that "innovation" deserves to be sold into Roose Bolton's captivity.
If unseen opportunities or obligations come up – invited to speak abroad?
Companies that expect people to count conferences against vacation time should be burned to the ground. (Figuratively speaking, of course, or literally but only at 2:30 am when no one is in the building.) Professional development is part of the fucking job, assholes. If you're a scrappy startup and can't pay for conferences, that's one thing. Making people take vacation to go is just mean-spirited and horrible.
What there should be is:
(1) two week mandatory vacation, every year. Banks have this, to prevent repeats of the SocGen disaster.
(2) 4 weeks vacation. That should establish 4 weeks as "the norm". If people need more, they can take time unpaid. If they use a little less, they can carry it over.
(3) sick time unlimited. If you suspect abuse, ask for a damn doctor's note.
(4) no vacation penalty for conferences related to the job.
(5) no stigma against unpaid leave, which should be unlimited as long as it doesn't directly hurt the company. (Obviously, the CEO can't take 3 months off without pay.)
If there's no stigma against unpaid leave, why is (2), the 4-week allocation, so important? First, because in reality, unpaid leave will always carry some stigma. So it's better to set the "official" PTO at 4 weeks, rather than at 2 while paying 4% more. Second, because I don't think there's any benefit to the company in someone working 50 vs. 48 weeks per year and so it doesn't deserve to be compensated as a general principle. (I'm all for people being paid back for unused vacation when they leave, but I think that people should be discouraged from taking less than 4 weeks off per year.)
What you described is pretty close to what the labor code guarantees in European countries, only in EU it's a bit stronger. If an employee takes too little vacation time the employer gets fined, period. This is nice - I don't want to compete against workaholics or those easily pressured into "voluntarily" working with no vacation.
Wow... In the EU, 4 weeks is the legal minimum paid time off for all workers. Some countries (eg Germany) set higher limits (of 6 weeks). If you don't use up your paid time off then the company has to pay you. And this applies to all workers, from developers to people working in a bar.
The holidays is one of the reasons I wouldn't want work on USA
This may be all the author is arguing for; I can't quite tell.
Unless there's some legal reason this policy can't work, the absence of a formal allocation of vacation days in an "unlimited vacation" policy would fail a sniff test for me --- your policy might be "unlimited" as a devious way of not committing to any particular number of vacation days.
(Full disclosure: we just do a normal accrued vacation day policy.)