If your employees were allowed to take time off whenever they wanted, would you be able to trust that they wouldn't take advantage of their new-found freedom?
Virgin Group founder Richard Branson recently made headlines when he publicly announced that his staff of nearly 200 at Virgin's head offices in the U.K. and U.S. can “take off whenever they want for as long as they want” and that they don’t even have to ask for approval. Managers are also not encouraged to track how much time their workers are taking off. The business magnate admitted he decided to implement an unlimited vacation policy after witnessing how well it worked for Netflix.
Looking at the Downside
With Branson’s announcement, Virgin Group became part of the roughly one percent of companies offering unlimited time off, according to the Society for Human Resource Management. Other companies offering the same perk include Ask.com, Eventbrite, Evernote, Glassdoor, Groupon, HubSpot, Netflix, SurveyMonkey, VMWare, ZocDoc and Zynga.
While unlimited time off may sound like a company policy employees can use to their advantage, it may actually backfire if employees don’t end up taking enough time off because they don’t know what's acceptable. Former MIT Sloan School of Management professor Lotte Bailyn writes in Quartz that “many people decide not to take advantage [of unlimited time off] because it's too hard to figure out the right amount to take." After all, you don’t want to be the one taking off significantly more time than everyone else on your team.
An unlimited vacation policy may also be challenging to adopt more widely in the U.S., a nation dubbed the "no-vacation nation" by The Atlantic because its workers take so little time off compared to those in other developed economies. According to a recent Glassdoor survey, the average American worker uses only 51 percent of their available paid time off over a period of 12 months. An anonymous Zynga employee responding to the survey wrote: "Although [the company] provides employees with unlimited vacation time, individuals are normally too busy to take vacations without working."
Think about it this way: It might be tough to get workaholics to take time off when they already don’t do it when their paid vacation days are monitored.
Do as I Do
At marketing software firm HubSpot, executives regularly take time off to encourage employees to do the same. Brian Halligan, the company's founder and CEO, says he’s trying to build a team where workers are encouraged to “think more and work less.” Unlimited vacation days can help.
“The whole point of our ‘use good judgment’ policy is giving employees the autonomy to build their schedule to optimize for results, not face time,” Halligan says. “To take time off, there's no permission slip or formal process. Employees are just expected to let their manager and colleagues know so they can plan accordingly. Some teams have group calendars so it's easy to see when folks are in or out, but that's the extent to which we regulate it."
Scott Dobroski, a spokesperson for career community Glassdoor, says that if CEOs don't take time off, no one else in the company will either. It’s all about the culture you create with your actions.
“Everything comes from the top,” Dobroski says. However, he also admits that it’s tough for him to know how much time he's taken off since he doesn’t track it. Glassdoor began providing unlimited time off nearly two years ago when senior leaders looked into competitive job perks and benefits to attract top talent as the company quickly expanded.
The Pillars of a Successful Policy
“It doesn’t work for all companies; it’s worked really well for our company," Dobroski says of Glassdoor's unlimited vacation benefit. For the policy to work in practice, Dobroski believes, companies need to support the following three beliefs in their culture:
- Integrity. You need to trust that employees will do the right thing.
- Accountability. Employees need to say what they’re going to do and get it done.
- Ownership. Everyone, no matter their role, needs to act as owners of the company.
“[At Glassdoor,] everyone has clearly defined goals that are metric driven,” Dobroski says. “It’s on the employees' own time to complete their tasks.”
When it comes to unlimited time off, there are a lot of pros and cons that a company considering the policy should take into account. Trusting and providing freedom to your employees empowers your team in many ways. Happier employees will yield higher productivity and, eventually, higher revenue.
But with this freedom comes responsibility. To really give your employees the benefits that come from unlimited time off, those in charge need to also understand that it's up to them to make sure their employees feel it's OK to take time off to unwind and recharge. Otherwise, unlimited vacation days will just be a perk that attracts top talent in the beginning but won't produce happier, healthier or more innovative workers in the long run.
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