7 ms·

Of course the other reason for 'unlimited vacation' is so when an employee leaves, the company doesn't have to pay them for unused vacation days. Huge red flag

Of course the other reason for 'unlimited vacation' is so when an employee leaves, the company doesn't have to pay them for unused vacation days. Huge red flag when a company has 'unlimited vacation'

JoeAltmaier 12y ago
... unless you just take vacations normally. Then perhaps you have already taken your vacation when you leave, and the company is out that work. It cuts both ways.
- CalRobert 12y ago
  Until I left the US every I worked operated on the basis of accrued vacation. The day you started you had 0 vacation days, after 6 months you could use half your annual allotment, etc.
  - JoeAltmaier 12y ago
    I admit I don't know how my vacation schedule works, officially. I just take time off and inform HR. They do whatever they do.
  - vonmoltke 12y ago
    My previous company ran a PTO system and advanced the entire balance on 01JAN every year. There aren't many, but they are out there.
    - madcaptenor 12y ago
      My current company does this. In addition balances have to be used by the end of the year. People are encouraged to take their vacation, so this leads to a lot of people taking random days in December off. As a result you can't get a damn thing done in December. I can't help but think that a system where accrued days expire after a certain amount of time or you can't carry more than a certain balance would mean that people's vacation time would be spread out more. As a result I could actually get some stuff done now that requires coordinating with people. I'm not sure if there would be a cost, however, in not being able to get stuff done at other times of the year.
- walshemj 12y ago
  err no in that case you normally reduce your final check pro rata ie if you leave half way through the year but have takeb 75% of your leave you owe the company and vice versa
tylermac1 12y ago
With these kinds of policies being more common in young companies, I highly doubt that paying back unused vacation can have any significant effect on normal operations. In the other case there's also generally limits on how much vacation time you can build up, generally taking a couple years of not taking vacation to max out.
- cloverich 12y ago
  IANA Financial person, but... it does go on the books as a debt. I'd be highly interested in someone in the know putting some numbers up, but at my office I know of many people who have several months of vacation saved up (because seemingly people tend to under-use their vacation time). If that company is looking to get bought out, it must be relevant to at least some extent.
  - wallflower 12y ago
    At my previous company, they specifically created a policy of no more than five days of rollover vacation from year to year specifically because of an on-the-books obligation of a couple million dollars (500+ employees) due to accrued vacation. Later, they changed that policy to NO rollover without VP level approval (e.g. honeymoons). In states like California that have strong employee laws they had to force all California based employees to burn down their accrued vacation every three months. Quasi-ethical and possibly borderline legal but that is what you have to do when employees hoard vacation under the mattress.
- dragonwriter 12y ago
  > With these kinds of policies being more common in young companies, I highly doubt that paying back unused vacation can have any significant effect on normal operations. It has an effect on the balance sheet, since vacation time accrued but not used is a liability; in companies whose operations are labor-heavy, and that have high-pay workers, that's may be a concern, especially when seeking investors, since concrete current liabilities can weigh heavily against hoped-for future returns.
  - 12y ago
stephen_g 12y ago
It's sad that works in the US. Here in Australia you have to give a full time employee a minimum of four weeks (paid), which accrues if unused. So somebody at a company with unlimited vacation would be no worse off of they never took holidays than someone who worked at a company with the regular 4 weeks.
- robzyb 12y ago
  I'm an Australian living in Japan. I moved here 2 months ago. Most Japanese get around 3 weeks of annual leave per year - but each day expires after 24 months. It is quite common for leave to expire.
  - GFischer 12y ago
    Here in Uruguay, if you don't take your leave, the company has to compensate you (pay it as an extra worked day). Same if they fire you.
    - sportanova 12y ago
      Time to move to Australia or Uruguay!
      - whatthemick 12y ago
        Or Denmark
  - xfalcox 12y ago
    Here in Brazil, if the company let it expire, they have pay you the double.
  - mhurron 12y ago
    > Most Japanese get around 3 weeks of annual leave per year - but each day expires after 24 months. > It is quite common for leave to expire. Japan has the same problem as the US in this case, your worth is tied to your work, the more it appears you're working hard, the more worth (and self-worth) you feel you have.
debacle 12y ago
IIRC, the company doesn't have to pay you for unused vacation days even if you don't use them. It's pretty much at the discretion of the company.
- gtCameron 12y ago
  It depends on the State the employee lives in
- e40 12y ago
  In CA, this is definitely not the case. A company must cut you a check on your final day that includes everything owed to you, including unused vacation days.
  - justizin 12y ago
    Or they can cut you a check that doesn't include everything owed to you, but ask you to sign a long agreement, buried within which is an assertion that the company has paid everything it owes you. Since you need this check, you wouldn't get your vacation days. Anyway, while I agree with the red flag concern, I don't necessarily agree that companies have unlimited vacation in order to cause you to take less. Esp in the startup world, esp at early stage, I don't expect to see this sort of intentional subterfuge - esp because of how it could backfire. I do think a minimum vacation policy makes more sense and allows, esp in places like CA where vacation is earned wage, and unused vacation is paid out at the end of the year, to manage the way vacation is counted. I also think a company with mandatory vacation should consider allowing people to take at least some vacation in the form of a bonus. Maybe they have a spouse who doesn't have as flexible of a schedule or just really enjoy their work. I don't think this should be an option for founders, however, and I think it should accompany a discussion, because it doesn't work for most people.
    - jacques_chester 12y ago
      > Or they can cut you a check that doesn't include everything owed to you, but ask you to sign a long agreement, buried within which is an assertion that the company has paid everything it owes you. You can write any old thing you like and get someone to sign it. That doesn't necessarily mean it's enforceable. Writing unenforceable clauses into fine print -- that you know are unenforceable -- is a legal bluff older than keeping records on clay tablets.
jimktrains2 12y ago
And how you accrue vacation at a company. I gain something like 6 or so hours every 2 weeks. Before I started I let them know of something I needed to be at in my first few weeks and their response was "That's OK, you can just do unpaid time". Other than not paying me if I leave mid year, what other reason could there be for crap like this?
- johnward 12y ago
  Yeah I don't understand this one. If you're going to give someone 4 weeks off (which is extremely generous in the US) just give it to them at the beginning of the year. Some places let you take the vacation before you accrue it but if you were to quit before earning enough to cover the days you've taken you owe the company money.
  - Tenhundfeld 12y ago
    This doesn't detract from your main point, but... 4 weeks off is not necessarily "extremely generous." It depends on whether that includes holidays. You might say that of course vacation days don't include holidays, but I know of several small tech/biotech companies that just give X total days of paid time off, usually 25-30. You can choose to take those PTO hours on holidays or not, which is more flexible I suppose. However, depending on the state and industry, there are 10-15 normal holidays every year. So, that 4 weeks off might really only equal 1-2 weeks of vacation, not so generous.
    - eru 12y ago
      Pray they don't start including weekends in the total.
    - johnward 12y ago
      I get 20 actual vacation days. I think maybe 8 recognized holidays and 2 personal choice holidays and I think another 2 holidays that are chosen by work site. So I get 30-32 days off per year which is pretty generous. For most people I know you would need to work 15 years before you earn even 4 weeks and that is usually the max amount. I'd say it's common for most white collar jobs to give you 2 weeks off until you hit 5 years then you might earn another week.
tlrobinson 12y ago
Or just take your vacation right before you leave... Seems like a good opportunity to test the limits of these "unlimited" vacation policies.
jonstewart 12y ago
It's gob-smacking that more folks here don't realize this. I would be very leery of working for a company with an open vacation, both for the reasons laid out in TFA, but also because it's a signal of pretty cynical management.

Of course the other reason for 'unlimited vacation' is so when an employee leaves, the company doesn't have to pay them for unused vacation days. Huge red flag when a company has 'unlimited vacation'

JoeAltmaier 12y ago

... unless you just take vacations normally. Then perhaps you have already taken your vacation when you leave, and the company is out that work. It cuts both ways.

CalRobert 12y ago
Until I left the US every I worked operated on the basis of accrued vacation. The day you started you had 0 vacation days, after 6 months you could use half your annual allotment, etc.
- JoeAltmaier 12y ago
  I admit I don't know how my vacation schedule works, officially. I just take time off and inform HR. They do whatever they do.
- vonmoltke 12y ago
  My previous company ran a PTO system and advanced the entire balance on 01JAN every year. There aren't many, but they are out there.
  - madcaptenor 12y ago
    My current company does this. In addition balances have to be used by the end of the year. People are encouraged to take their vacation, so this leads to a lot of people taking random days in December off. As a result you can't get a damn thing done in December. I can't help but think that a system where accrued days expire after a certain amount of time or you can't carry more than a certain balance would mean that people's vacation time would be spread out more. As a result I could actually get some stuff done now that requires coordinating with people. I'm not sure if there would be a cost, however, in not being able to get stuff done at other times of the year.
walshemj 12y ago
err no in that case you normally reduce your final check pro rata ie if you leave half way through the year but have takeb 75% of your leave you owe the company and vice versa

tylermac1 12y ago

With these kinds of policies being more common in young companies, I highly doubt that paying back unused vacation can have any significant effect on normal operations. In the other case there's also generally limits on how much vacation time you can build up, generally taking a couple years of not taking vacation to max out.

cloverich 12y ago
IANA Financial person, but... it does go on the books as a debt. I'd be highly interested in someone in the know putting some numbers up, but at my office I know of many people who have several months of vacation saved up (because seemingly people tend to under-use their vacation time). If that company is looking to get bought out, it must be relevant to at least some extent.
- wallflower 12y ago
  At my previous company, they specifically created a policy of no more than five days of rollover vacation from year to year specifically because of an on-the-books obligation of a couple million dollars (500+ employees) due to accrued vacation. Later, they changed that policy to NO rollover without VP level approval (e.g. honeymoons). In states like California that have strong employee laws they had to force all California based employees to burn down their accrued vacation every three months. Quasi-ethical and possibly borderline legal but that is what you have to do when employees hoard vacation under the mattress.
dragonwriter 12y ago
> With these kinds of policies being more common in young companies, I highly doubt that paying back unused vacation can have any significant effect on normal operations. It has an effect on the balance sheet, since vacation time accrued but not used is a liability; in companies whose operations are labor-heavy, and that have high-pay workers, that's may be a concern, especially when seeking investors, since concrete current liabilities can weigh heavily against hoped-for future returns.
- 12y ago

stephen_g 12y ago

It's sad that works in the US. Here in Australia you have to give a full time employee a minimum of four weeks (paid), which accrues if unused. So somebody at a company with unlimited vacation would be no worse off of they never took holidays than someone who worked at a company with the regular 4 weeks.

robzyb 12y ago
I'm an Australian living in Japan. I moved here 2 months ago. Most Japanese get around 3 weeks of annual leave per year - but each day expires after 24 months. It is quite common for leave to expire.
- GFischer 12y ago
  Here in Uruguay, if you don't take your leave, the company has to compensate you (pay it as an extra worked day). Same if they fire you.
  - sportanova 12y ago
    Time to move to Australia or Uruguay!
    - whatthemick 12y ago
      Or Denmark
- xfalcox 12y ago
  Here in Brazil, if the company let it expire, they have pay you the double.
- mhurron 12y ago
  > Most Japanese get around 3 weeks of annual leave per year - but each day expires after 24 months. > It is quite common for leave to expire. Japan has the same problem as the US in this case, your worth is tied to your work, the more it appears you're working hard, the more worth (and self-worth) you feel you have.

debacle 12y ago

IIRC, the company doesn't have to pay you for unused vacation days even if you don't use them. It's pretty much at the discretion of the company.

gtCameron 12y ago
It depends on the State the employee lives in
e40 12y ago
In CA, this is definitely not the case. A company must cut you a check on your final day that includes everything owed to you, including unused vacation days.
- justizin 12y ago
  Or they can cut you a check that doesn't include everything owed to you, but ask you to sign a long agreement, buried within which is an assertion that the company has paid everything it owes you. Since you need this check, you wouldn't get your vacation days. Anyway, while I agree with the red flag concern, I don't necessarily agree that companies have unlimited vacation in order to cause you to take less. Esp in the startup world, esp at early stage, I don't expect to see this sort of intentional subterfuge - esp because of how it could backfire. I do think a minimum vacation policy makes more sense and allows, esp in places like CA where vacation is earned wage, and unused vacation is paid out at the end of the year, to manage the way vacation is counted. I also think a company with mandatory vacation should consider allowing people to take at least some vacation in the form of a bonus. Maybe they have a spouse who doesn't have as flexible of a schedule or just really enjoy their work. I don't think this should be an option for founders, however, and I think it should accompany a discussion, because it doesn't work for most people.
  - jacques_chester 12y ago
    > Or they can cut you a check that doesn't include everything owed to you, but ask you to sign a long agreement, buried within which is an assertion that the company has paid everything it owes you. You can write any old thing you like and get someone to sign it. That doesn't necessarily mean it's enforceable. Writing unenforceable clauses into fine print -- that you know are unenforceable -- is a legal bluff older than keeping records on clay tablets.

jimktrains2 12y ago

And how you accrue vacation at a company. I gain something like 6 or so hours every 2 weeks. Before I started I let them know of something I needed to be at in my first few weeks and their response was "That's OK, you can just do unpaid time". Other than not paying me if I leave mid year, what other reason could there be for crap like this?

johnward 12y ago
Yeah I don't understand this one. If you're going to give someone 4 weeks off (which is extremely generous in the US) just give it to them at the beginning of the year. Some places let you take the vacation before you accrue it but if you were to quit before earning enough to cover the days you've taken you owe the company money.
- Tenhundfeld 12y ago
  This doesn't detract from your main point, but... 4 weeks off is not necessarily "extremely generous." It depends on whether that includes holidays. You might say that of course vacation days don't include holidays, but I know of several small tech/biotech companies that just give X total days of paid time off, usually 25-30. You can choose to take those PTO hours on holidays or not, which is more flexible I suppose. However, depending on the state and industry, there are 10-15 normal holidays every year. So, that 4 weeks off might really only equal 1-2 weeks of vacation, not so generous.
  - eru 12y ago
    Pray they don't start including weekends in the total.
  - johnward 12y ago
    I get 20 actual vacation days. I think maybe 8 recognized holidays and 2 personal choice holidays and I think another 2 holidays that are chosen by work site. So I get 30-32 days off per year which is pretty generous. For most people I know you would need to work 15 years before you earn even 4 weeks and that is usually the max amount. I'd say it's common for most white collar jobs to give you 2 weeks off until you hit 5 years then you might earn another week.

tlrobinson 12y ago

Or just take your vacation right before you leave... Seems like a good opportunity to test the limits of these "unlimited" vacation policies.

jonstewart 12y ago

It's gob-smacking that more folks here don't realize this. I would be very leery of working for a company with an open vacation, both for the reasons laid out in TFA, but also because it's a signal of pretty cynical management.