I'll start with a confession. Based on below, I'm #3, all the way, and I think #2 is the absolute worst. I see it from an accounting point of view: you've got a

I'll start with a confession. Based on below, I'm #3, all the way, and I think #2 is the absolute worst. I see it from an accounting point of view: you've got a liability on the books the moment the benefit is promised and it's in everyone's best interest to have it realized on a steady schedule. 1. Individual allocations with strict "rollover" policies. 2. Unlimited, but reasonable, timeoff policies. 3. Individual allocations with 0% carry-over: if you would lose it, it's forced upon you. Please don't make us drag it out. So that said, I don't see how you have a prayer in the world of avoiding "drag it out" unless you have a management culture thats firmly based in what dougmwne suggests: lead by example and you won't have to fight the extremes (which are unlikely to give anyway) for the sake of the core quite so much. It's also more compatible with highly-geographical laws around unused vacation payouts. If you think your organization is winning, by minimizing these kind of benefits... I think you're definitely losing and it's putting your most dedicated talent at long-term risk for short term gain.