1. The unlimited paid time off policy
This is the second post in a series about 10 things to know when creating a PTO policy.
PTO policies generally fall into 3 broad categories:
- Unlimited PTO Policies
- Traditional PTO Policies
- PTO Bank Policies
This post focuses on a type of PTO policy that is gaining popularity among progressive businesses in extremely competitive sectors; The Unlimited Paid Time Off Policy.
The simplest option from an administrative perspective is to have a policy of unlimited paid time off. This option (which is gaining a lot of popularity in the Technology sector in particular) is not as crazy as it first sounds. The idea is that while staff are responsible for performing their work and delivering in good time, they’re also responsible for managing their own down time.
Booking time off in this scenario might amount to little more than a staff member shooting their manager an email. However “unlimited” does not necessarily mean “untracked”. You might like to have something more formal in place, like a leave management system (Bindle for example) that records time off requests, has a configurable approval process, yet has PTO balance tracking switched off.
Some evidence suggests that in workplaces with an unlimited leave policy in place, staff actually take less time off as a result1. The reason being that in some companies there is a culture of work and not leave. Staff may need to be actively encouraged to take at least 3 - 4 weeks off (in addition to the 10 federal holidays) per year.
In order for this type of policy to work effectively, it requires an environment with a high level of mutual trust and respect. Justin Di Lollo, head of government relations companies at STW Group, says it quite well2:
This is a scheme for companies with mature people who are emotionally stable, who enjoy doing their work.
So, it’s obviously not for everyone, but this type of policy is at least something worth considering.
Smart Company How Unlimited Annual Leave Backfired For This UK Business ↩