5 ms·

Why unlimited vacation is bad

27 points by simonjgreen 4y ago

lisasays 4y ago
Employees allowed to take off as much time as they would like end up taking fewer days off compared with those who are given a set number of days per year, according to a 2017 survey by HR platform Namely. Which was the precise intent of the policy from the very start.
- 1123581321 4y ago
  I recall otherwise. Early adopters of unlimited PTO tended to be progressive companies interested in employee welfare. Often attracting people from companies only offering 5-10 days PTO and restricting sick and personal days to a separate pool. Since then, it’s more common for more fixed PTO days to be offered and not to allow flexible workweeks rather than use personal hours, so more PTO can be used for vacation.
  - lisasays 4y ago
    Then why not just offer 15-25 days of explicit vacation? That you can, you know, actually use? Like a decent, healthy, civilized company. That doesn't try to mess with its employees heads (quite so blatantly and needlessly).
    - 1123581321 4y ago
      Sure. I'm just talking about the origin of the unlimited PTO trend since you said the origins were about convincing people to use less PTO. There are a lot more companies offering generous fixed PTO now, and that was partly to compete with unlimited.
    - bluefirebrand 4y ago
      In some places if you have vacation days in your contract then the company is required to pay you out remaining days that you left unused. It winds up being cheaper for them to offer Unlimited Days* because then they don't pay out un-taken days. * Subject to manager approval of course. I strongly suspect there is still a target number of days allowed for each employee based on their place in the org, and requests for days past that number will usually be denied unless there are extenuating circumstances.
      - prepend 4y ago
        Exactly, that's why companies offer unlimited rather than a generous amount. I worked for a firm that gave 30 days of PTO a year (in addition to holidays and whatnot). They budgeted it as an expense and planned accordingly. It would be interesting to see what "unlimited" vacation giving firms budget and plan for as a liability. If the goal is high employee morale, then they should budget and plan a very high amount. If the goal is to "benefit signal" to pretend they have good benefits, then they will only budget a low amount.
        cyanydeez 4y ago
        They plan zero. Unlimited PTo relies on the rest of the business processes to regulate behavior. For consultants, %. Billable will dictate your unlimited PTO. for widget making, quotas will work. For project assignments, expect tighter deadlines. Company culture will dictate usage and accounting gets to remove the liability.
        dragonwriter 4y ago
        > It would be interesting to see what "unlimited" vacation giving firms budget and plan for as a liability. “Unlimited” (=non-accruable) PTO isn’t a liability, that’s (from the firm’s perspective) the whole point of using it.
      - markus92 4y ago
        Yup. Changing jobs and I’m expecting to get 400 accrued hours paid out from my previous job.
        thfuran 4y ago
        Have you never taken a vacation?
        markus92 3y ago
        Of course I have, but not a whole lot. 6 weeks a year builds up over five years.
    - coldtea 4y ago
      Even better, why not offer unlimited vacation combined with a set minimum number of, say, 25 days vacation everybody should take?
      - cyanydeez 4y ago
        My place switched to unlimited, when pressed they stated you're required to take 10 days. Prior to this, they had seniority up to 20 days based on number of year. This was absolutely about removing liability from their books. And sold purely as a "look how ESG we are"
        coldtea 4y ago
        The law should kill the seniority thing for vacation days too. Perhaps make them stick for a year (to avoid somebody being hired and then living after 6 months 20 days of which are paid vacations), but then everybody should be offered the same number of days to take annually. After all they've worked for the same number of days in that year as any older employee too.
        anonymouskimmer 4y ago
        And some of those newer employees are older (in age) than younger employees with greater seniority.
    - cyanydeez 4y ago
      If you're a consultant, it's basically a meaningless offer as you're still X% billable. If there's some other can ncrete metric, infinite PTO just means whoever already has their privileged position.
- kbelder 4y ago
  I think that was just a side benefit. The main reason is that vacation days are an accounting liability; six-eight weeks per employee is a lot of money, and they company isn't fully in control of when they have to pay it out. If employees took just as many days off with unlimited vacation time, it would still be a win, because those days don't accrue.
- yumraj 4y ago
  AFAIK accrued PTO sits on the books of the companies as a liability (or expense or whatever) since they have to pay for it when the employee leaves/is terminated. Unlimited PTO doesn’t accrue and hence does not show on the books. That IMHO is the primary benefit to the companies.
  - cyanydeez 4y ago
    Right, that's exactly what I saw when my company did this. If people saw the loss of guaranteed benefits to something entirely in the companies benefit, I heard nothing. HR sold it like we were gaining something. The people who gained the most were managers without specific output. Imagine you accrue enough portfolios, and now your set.
- theGnuMe 4y ago
  It’s that and the cash liability.
- noloblo 4y ago
  unpaywall archive link: https://archive.is/20230421233838/https://www.ft.com/content/10493dfb-ed99-49e0-b4d1-4b9c5004e453 https://archive.is/20230421233838/https://www.ft.com/content...
mobu 4y ago
Companies rely on marketing for everything and "unlimited" vacation is just a marketing gimmick to capture the attention of potential employees. You go to an "all" you can eat buffet but you know that they will object if you actually start eating ridiculous amount. So just from that perspective, "unlimited" is false-advertising and so is "unlimited" vacation.
- JohnFen 4y ago
  This. Anytime you see "unlimited", you can be sure that it's just marketing nonsense.
- marssaxman 4y ago
  Unlimited vacation works well for me. Instead of hoarding my precious vacation days, carefully judging whether some occasion is special enough to justify rationing them out (therefore possibly having to miss out on something else, later in the year), I just... take time off, whenever there's reason to, and don't worry about it. I don't know whether I take more or less time off, and that's the beauty of it: I get what I want and I don't have to think about it.
- yellowapple 4y ago
  > You go to an "all" you can eat buffet but you know that they will object if you actually start eating ridiculous amount. If they have a problem with me devouring literally every slice of bacon they have, then they can remove my fat ass from the premises at their leisure. Hope they brought a forklift.
denvermullets 4y ago
my company just changed the policy from unlimited PTO to a set amount (4 weeks). it made me realize that in almost a year of being at this company i've only taken 1 week off, and that was for my wedding. ended up taking this week off because i really need to make sure i'm at least taking off the minimum given. this is precisely why we changed our policy. i would've taken more off if i had a baseline of what normal employees took off but most people didn't really.
- pastage 4y ago
  25 days every year is what normal people take
mathgladiator 4y ago
I'm going to start some hiring soon with a different approach. Fundamentally, I think employment is broken. As the fish rots from the head down, I aspire to have 2-3 big month long RV trips, so I'm trying to figure an internal market of projects and a minimum yearly commitment (for benefits). https://www.adama-platform.com/2023/04/15/going-hard.html https://www.adama-platform.com/2023/04/15/going-hard.html is the first blog post in a series.
coldtea 4y ago
Unlimited vacation is great. Companies offering "unlimited vacation" when they don't mean it, and building a penalizing culture around taking it, is bad.
- philwelch 4y ago
  If you find a company that actually means “unlimited vacation”, let me know. I will get a job there and after my first couple of months, I will say, “okay, I’m going on unlimited vacation now” and never come back. Obviously there are limits. There have to be. I’d rather know what those limits are up front.
  - grepfru_it 4y ago
    At GitHub they limit you to 29 consecutive (calendar) days of leave. However anything over 14 days needs to be approved by your manager. And then there is a lower limit to the days you must be in the office to collect a full bonus. Finally there is a maximum time you can take off in a half year which directly relates to a negative employee review. So it’s not unlimited, but recruiters won’t tell you the nuance.. you find out when you read the handbook and talk to your manager on day 1. But why take leave anyway, I watched someone get hired, literally do nothing, and it took 7 months for the company to let them go
    - Beaver117 4y ago
      >I watched someone get hired, literally do nothing, and it took 7 months for the company to let them go If they were "literally" doing nothing, like not even joining meetings or logging in, they could be fired within a week. What you mean is they weren't writing code to the velocity and standard that was expected. Maybe that falls on you for not helping them onboard?
  - Schiendelman 4y ago
    I work for Indeed; I take ~8w/year of PTO. No one bats an eye.
musicale 4y ago
If you try to take 4+ weeks off, you typically find out that "unlimited" actually means "up to N weeks per year", where N<4. How about 6 weeks of yearly PTO (paid out at the end of the year if you don't use it) along with some amount of optional unpaid?

27 points by simonjgreen 4y ago

Employees allowed to take off as much time as they would like end up taking fewer days off compared with those who are given a set number of days per year, according to a 2017 survey by HR platform Namely. Which was the precise intent of the policy from the very start.

1123581321 4y ago
I recall otherwise. Early adopters of unlimited PTO tended to be progressive companies interested in employee welfare. Often attracting people from companies only offering 5-10 days PTO and restricting sick and personal days to a separate pool. Since then, it’s more common for more fixed PTO days to be offered and not to allow flexible workweeks rather than use personal hours, so more PTO can be used for vacation.
- lisasays 4y ago
  Then why not just offer 15-25 days of explicit vacation? That you can, you know, actually use? Like a decent, healthy, civilized company. That doesn't try to mess with its employees heads (quite so blatantly and needlessly).
  - 1123581321 4y ago
    Sure. I'm just talking about the origin of the unlimited PTO trend since you said the origins were about convincing people to use less PTO. There are a lot more companies offering generous fixed PTO now, and that was partly to compete with unlimited.
  - bluefirebrand 4y ago
    In some places if you have vacation days in your contract then the company is required to pay you out remaining days that you left unused. It winds up being cheaper for them to offer Unlimited Days* because then they don't pay out un-taken days. * Subject to manager approval of course. I strongly suspect there is still a target number of days allowed for each employee based on their place in the org, and requests for days past that number will usually be denied unless there are extenuating circumstances.
    - prepend 4y ago
      Exactly, that's why companies offer unlimited rather than a generous amount. I worked for a firm that gave 30 days of PTO a year (in addition to holidays and whatnot). They budgeted it as an expense and planned accordingly. It would be interesting to see what "unlimited" vacation giving firms budget and plan for as a liability. If the goal is high employee morale, then they should budget and plan a very high amount. If the goal is to "benefit signal" to pretend they have good benefits, then they will only budget a low amount.
      - cyanydeez 4y ago
        They plan zero. Unlimited PTo relies on the rest of the business processes to regulate behavior. For consultants, %. Billable will dictate your unlimited PTO. for widget making, quotas will work. For project assignments, expect tighter deadlines. Company culture will dictate usage and accounting gets to remove the liability.
      - dragonwriter 4y ago
        > It would be interesting to see what "unlimited" vacation giving firms budget and plan for as a liability. “Unlimited” (=non-accruable) PTO isn’t a liability, that’s (from the firm’s perspective) the whole point of using it.
    - markus92 4y ago
      Yup. Changing jobs and I’m expecting to get 400 accrued hours paid out from my previous job.
      - thfuran 4y ago
        Have you never taken a vacation?
        markus92 3y ago
        Of course I have, but not a whole lot. 6 weeks a year builds up over five years.
  - coldtea 4y ago
    Even better, why not offer unlimited vacation combined with a set minimum number of, say, 25 days vacation everybody should take?
    - cyanydeez 4y ago
      My place switched to unlimited, when pressed they stated you're required to take 10 days. Prior to this, they had seniority up to 20 days based on number of year. This was absolutely about removing liability from their books. And sold purely as a "look how ESG we are"
      - coldtea 4y ago
        The law should kill the seniority thing for vacation days too. Perhaps make them stick for a year (to avoid somebody being hired and then living after 6 months 20 days of which are paid vacations), but then everybody should be offered the same number of days to take annually. After all they've worked for the same number of days in that year as any older employee too.
        anonymouskimmer 4y ago
        And some of those newer employees are older (in age) than younger employees with greater seniority.
  - cyanydeez 4y ago
    If you're a consultant, it's basically a meaningless offer as you're still X% billable. If there's some other can ncrete metric, infinite PTO just means whoever already has their privileged position.
kbelder 4y ago
I think that was just a side benefit. The main reason is that vacation days are an accounting liability; six-eight weeks per employee is a lot of money, and they company isn't fully in control of when they have to pay it out. If employees took just as many days off with unlimited vacation time, it would still be a win, because those days don't accrue.
yumraj 4y ago
AFAIK accrued PTO sits on the books of the companies as a liability (or expense or whatever) since they have to pay for it when the employee leaves/is terminated. Unlimited PTO doesn’t accrue and hence does not show on the books. That IMHO is the primary benefit to the companies.
- cyanydeez 4y ago
  Right, that's exactly what I saw when my company did this. If people saw the loss of guaranteed benefits to something entirely in the companies benefit, I heard nothing. HR sold it like we were gaining something. The people who gained the most were managers without specific output. Imagine you accrue enough portfolios, and now your set.
theGnuMe 4y ago
It’s that and the cash liability.
noloblo 4y ago
unpaywall archive link: https://archive.is/20230421233838/https://www.ft.com/content/10493dfb-ed99-49e0-b4d1-4b9c5004e453 https://archive.is/20230421233838/https://www.ft.com/content...

mobu 4y ago

Companies rely on marketing for everything and "unlimited" vacation is just a marketing gimmick to capture the attention of potential employees. You go to an "all" you can eat buffet but you know that they will object if you actually start eating ridiculous amount. So just from that perspective, "unlimited" is false-advertising and so is "unlimited" vacation.

JohnFen 4y ago
This. Anytime you see "unlimited", you can be sure that it's just marketing nonsense.
marssaxman 4y ago
Unlimited vacation works well for me. Instead of hoarding my precious vacation days, carefully judging whether some occasion is special enough to justify rationing them out (therefore possibly having to miss out on something else, later in the year), I just... take time off, whenever there's reason to, and don't worry about it. I don't know whether I take more or less time off, and that's the beauty of it: I get what I want and I don't have to think about it.
yellowapple 4y ago
> You go to an "all" you can eat buffet but you know that they will object if you actually start eating ridiculous amount. If they have a problem with me devouring literally every slice of bacon they have, then they can remove my fat ass from the premises at their leisure. Hope they brought a forklift.

denvermullets 4y ago

my company just changed the policy from unlimited PTO to a set amount (4 weeks). it made me realize that in almost a year of being at this company i've only taken 1 week off, and that was for my wedding. ended up taking this week off because i really need to make sure i'm at least taking off the minimum given. this is precisely why we changed our policy. i would've taken more off if i had a baseline of what normal employees took off but most people didn't really.

pastage 4y ago
25 days every year is what normal people take

mathgladiator 4y ago

I'm going to start some hiring soon with a different approach. Fundamentally, I think employment is broken. As the fish rots from the head down, I aspire to have 2-3 big month long RV trips, so I'm trying to figure an internal market of projects and a minimum yearly commitment (for benefits). https://www.adama-platform.com/2023/04/15/going-hard.html https://www.adama-platform.com/2023/04/15/going-hard.html is the first blog post in a series.

coldtea 4y ago

Unlimited vacation is great. Companies offering "unlimited vacation" when they don't mean it, and building a penalizing culture around taking it, is bad.

philwelch 4y ago
If you find a company that actually means “unlimited vacation”, let me know. I will get a job there and after my first couple of months, I will say, “okay, I’m going on unlimited vacation now” and never come back. Obviously there are limits. There have to be. I’d rather know what those limits are up front.
- grepfru_it 4y ago
  At GitHub they limit you to 29 consecutive (calendar) days of leave. However anything over 14 days needs to be approved by your manager. And then there is a lower limit to the days you must be in the office to collect a full bonus. Finally there is a maximum time you can take off in a half year which directly relates to a negative employee review. So it’s not unlimited, but recruiters won’t tell you the nuance.. you find out when you read the handbook and talk to your manager on day 1. But why take leave anyway, I watched someone get hired, literally do nothing, and it took 7 months for the company to let them go
  - Beaver117 4y ago
    >I watched someone get hired, literally do nothing, and it took 7 months for the company to let them go If they were "literally" doing nothing, like not even joining meetings or logging in, they could be fired within a week. What you mean is they weren't writing code to the velocity and standard that was expected. Maybe that falls on you for not helping them onboard?
- Schiendelman 4y ago
  I work for Indeed; I take ~8w/year of PTO. No one bats an eye.

musicale 4y ago

If you try to take 4+ weeks off, you typically find out that "unlimited" actually means "up to N weeks per year", where N<4. How about 6 weeks of yearly PTO (paid out at the end of the year if you don't use it) along with some amount of optional unpaid?