Your PTO Policy Needs a Performance Evaluation of Its Own

Despite all the buzz around unlimited PTO, it is by no means an emerging trend. Less than 1% of employers offer an unlimited PTO strategy, but it may be something to take into consideration the next time you are revisiting company benefits.

Workplace influencers such as Netflix and Virgin Group have adopted “the policy-that-isn’t” with the rationale that employees will better manage their own time because it’s in the best interest of their career to do so. Additionally, these companies recognized the importance of focusing on what employees accomplish rather than how many hours or days worked.  

Even though an unlimited PTO policy may work for companies like Netflix, Virgin Group, and SelectOne, it’s not for everyone. To help you get the ball rolling, I’ve put together a brief list addressing why an unlimited PTO policy may or may not work for you.

The Policy That Keeps Giving Back

• Increased engagement – As management expresses greater levels of trust amongst their employees, it’s proven to increase levels of employee engagement. (Huge financial rewards!)
• “Work-life balance” – Employees have the ability to manage their own time to best serve their personal needs while simultaneously excelling in their career.
• Build loyalty – The trust and freedom builds employee loyalty to the organization increasing the likelihood for your top performers to stay around.
• Penny savings! – Eliminates the accrued expenses from all the unused vacation time employees roll or bank.
• Time is money - According to ask.com, the “policy-that-isn’t” saves 52 hours per year as it’s no longer an administrative task to police accrued vacation for each employee.
• Attract the best – 69% of perspective candidates would be more inclined to take a job offering such a policy.

One Policy Does Not Fit all

• Still a need for tracking – It’s important to have administrative assistance when tracking leave for the Family and Medical Leave Act.
• Define “unlimited” – What does this mean? How will you quantify the term for recommended number or hours out of the office?
• Structural limitations – Most commonly, only salaried employees are eligible for unlimited PTO, this creates a barrier for hourly workers.
• Different tiers – The different types of jobs in your organization have different expectations which limit the time they can be out of the office versus those who are able to work remotely.
• Employee pushback – Long term employees may not think fondly of this transition. To them, it may appear you’re flushing away the monetary value associated with their accrued vacation days. 

As previously mentioned, unlimited PTO is not a policy for everyone, but if you’re willing to consider having the conversation, tread lightly. Communication and preparation are key to crafting a successful unlimited vacation policy your employees will appreciate and enjoy.