Health and Wellness

Unlimited PTO: A Gift or a Curse?

January 27, 2022

Many companies are starting to offer unlimited PTO, but what is it all about?

yes and no spelled out in tiles on a red background

Did you know that there are companies which offer their employees unlimited PTO days? The idea is gaining more traction than ever as it becomes mainstream, something for both employers and employees to consider. Yet for some, it may still feel like a strange or even a suspicious offer. In fact, many well-known companies are switching to this model: Netflix, Sony, Grubhub, and LinkedIn, to name a few, have all been outspoken about their focus on creating a good work-life balance for their employees. Here at Journey, we’ve already had this for years at our headquarters location, as we are always aspiring to be forward-thinkers. One thing is for sure: it is absolutely worth looking into! – but is a process to implement with care, and it may not work for all businesses.

Being able to take off as many days as you feel that you need certainly sounds amazing. And to be able to do so without having to even think about setting aside any time off for an emergency may even sound like a foreign concept. But it is extremely relevent, here and now. For an employee today without unlimited PTO, it can be extremely frustrating to have to burn through every day of one’s hard-earned PTO all at once, just to cover the mandatory COVID quarantine period. And this is actually happening: some companies no longer offer paid leave for COVID-related time off, even though COVID hasn’t gone away (and apparently has no plans to, either). A good solution for here and now may just be to offer unlimited vacation days in order to cover those mandatory quarantines and to keep everyone at your company safe and reassured. Consider the plight of an employee who learns that they came into close contact with COVID, but a few days later, they aren’t experiencing any symptoms: they may feel tempted or even compelled to run right back to work in order to avoid losing their hard-earned PTO to an unplanned week stuck at home!

Yet can you implement a policy like this without it being taken advantage of? In 2019, 2,675 employees were surveyed by MetLife about different benefit trends. It should come as no surprise that unlimited vacation days is the top emerging trend. As this trend continues to grow, we will surely see employees start to factor this in when choosing what company to work for. 

Giving employees an opportunity to unplug and recharge – and to feel trusted to decide when they need to take time off – can result in improved employee engagement, as well as increased productivity.

What it is

An uncapped amount of paid days off per year

A beach with a blanket spread out with a hat, sunglasses, an orange, a drink and a book on it.

This SOUNDS too good to be true. But it isn’t! With a proper request and advance notice to management, an employee can truly take off as many days as they want or need, as long as all of their work is getting done and all critical shifts are covered by other employees.

Related:  Identifying the Perfect Candidate

A tool to enhance productivity

There is evidence that unlimited PTO even boosts productivity. It ensures that employees are motivated to use their time wisely to get all of their work done so they can take the time off that they want. According to an article by Indeed, “Giving employees an opportunity to unplug and recharge—and to feel trusted to decide when they need to take time off—can result in improved employee engagement, as well as increased productivity.”

A great recruitment tool

With all of the fantastic companies out there today, some of today’s best and brightest face a tough choice about where they want to spend their career. Offering unlimited PTO is a great way to come out ahead of a similar business that doesn’t offer it, giving your company a competitive leg up in the contest to acquire the best talent the market has to offer.

What it isn’t

A license to act irresponsibly

a dog wrapped up in a blanket with just his paws and nose sticking out

Unlimited PTO does not mean that employees get to take off as much time as they want, to the detriment of their employer and their fellow employees. It still requires advanced notice, work being completed, and making sure that it doesn’t impede anyone else’s requests for time off. Requests might not always be approved, and that is to be expected.

A get out of work free card

It certainly doesn’t mean that your employees just get to wake up and decide that they don’t feel like going to work today. Most companies have rules, regulations, and discipline in place for abused policies. The common sense rule still stands: if you are consistently not showing up at work with no regard to the rest of your company, then you will very quickly be looking for another job. Of course, the exception to this is if you are truly sick. In that case, you will be allowed to take the time to get back to health (which may require a doctor’s note), and you don’t have to worry about losing all your hard-earned days. 

A solution to employee burnout

Unfortunately, there may be a catch to all of this. Employees who are offered unlimited PTO often take LESS time off than people with traditional PTO packages. There may be several factors at play here. To name just one example, people tend to feel guilty about taking too many days off: employees with unlimited PTO tend to work harder and have less time off to show for it, which may ultimately result in burn-out.

Related:  Go, Team, Go! Team Building During COVID

a person with a backpack stares out over the ocean at the sunset

Unlimited PTO is an amazing perk, but it does need to be implemented correctly. It is important that the policies are clear and that the requests for PTO are approved when reasonable. A great place to start with unlimited vacation days is by requiring that employees take a minimum number of weeks off. That way, they don’t end up taking less than they need. Not everyone feels this way: for example, one article from Lifehacker argues that unlimited vacation is a scam, so that “an employer doesn’t have to pay out unused vacation days when [employees] leave the company.” This shines an entirely different perspective on things: are companies which offer unlimited vacation in reality simply motivated by the idea of offering their employees less than they are worth, while simultaneously portraying themselves as great places to work with generous benefits? Opinions may differ, and different companies surely have different reasons for what they do; but one truly hopes that most companies are like Journey: motivated by the opportunity – and the choice – to run a company with employees who are more productive, more engaged, more secure, more resilient, and all-around happier.

Job seekers: if you are looking at working for a company that offers this benefit, make sure you do your research! Read reviews from actual employees, and make sure that you are choosing a place that will value you and your work-life balance, which we know leads to more health and happiness. Don’t be shy about asking how unlimited PTO policies work – you may find comfort from learning more about their intentions, if you just take the opportunity to ask.

Subscribe to our newsletter

Get the latest from the world of payroll & HR delivered straight to your inbox!