The Myth of the Unlimited Vacation Policy

The Myth of the Unlimited Vacation Policy(medium.com)

25 points by gershwin 10 years ago | 14 comments

pjc50 10 years ago |

Indeed. It's a means of weaponising ambiguity into guilt. Everyone knows it's not unlimited, because you can't take 3 months off. But because there's no boundary, the real limit has to be found by stressfully, riskily probing it. Then there's plenty of room for favouritism in who's actually allowed to take the time off.

See "Tyranny of Structurelessness", etc, etc.

finance-geek 10 years ago |

Some of the nefarious reasons in the article and comments may well be true -- but there is a simple accounting reason for "unlimited" vacation policies -- companies do not need to pay workers for accrued vacation days un-taken.

In some states and countries, use-it-or-lose-it policies are not legal, so employees always accrue the days, often carrying them from year to year. It is a bit unfair since the employee leaving hits the company with a big payout (though the payout is just payout that should have happened long ago.) On the other hand it is very fair, as i've been stuck in some companies where my boss would not let me take vacation, so the payout was the least they could do.

greenyoda 10 years ago | |

"It is a bit unfair since the employee leaving hits the company with a big payout"

Paying out for unused vacation days is the only fair thing to do. After all, the company got all those unused vacation days as extra work days.

finance-geek 10 years ago | | |

I noted it was unfair because when the employees leave, the cash-out happens at the employee's final salary (which may be larger (even 2x!) the salary at the time of accrual)

phamilton 10 years ago |

At a previous company with a "no vacation policy" policy, I found I was more liberal with my odd Friday off to go skiing, and more likely to work remotely one or more days on my actual vacation.

Today, with a normal PTO accrual system, I find myself very aware that a day of vacation costs me $500 in lost paid out PTO. That makes a semi spontaneous Friday on the mountain more expensive than I'm comfortable with. It means that when I'm bored over the year end holidays at my in-laws home I don't do any work even if I feel like it because I don't want to waste my limited PTO.

Honestly, I'd rather ski more and have semi-working vacations. Not all the time, but often.

jerf 10 years ago | |

"Today, with a normal PTO accrual system, I find myself very aware that a day of vacation costs me $500 in lost paid out PTO."

If you have a cap on how much you can accrue, which is pretty typical [1], that's not true. Once you hit the cap, you'd still lose the days; thus, they are a sunk cost.

The only days that cost you are any days that would be paid out at the end of your employment, and even that really only matters if you're going to roll from one job into another in less than the number of days you were paid out at the end, otherwise it's still just a rearrangement of a constant number of paid days and unpaid days.

Good news: You probably don't need to conceive of paid vacation days as being "changed" against you.

Not wasting your limited PTO remains a concern, of course, but as with so many other things "unlimited" isn't truly on the table either, so....

[1]: I hear tell of rumors that accrued vacation time is somehow taxed at year's end in the US, but I've never quite heard someone lay out the accounting and tax details. If you know them I'd be interested to hear it.

phamilton 10 years ago | | |

> If you have a cap on how much you can accrue, which is pretty typical [1], that's not true. Once you hit the cap, you'd still lose the days; thus, they are a sunk cost.

It's not a sunk cost at all. It's only a sunk cost once you hit the cap.

In the current SF engineering culture the average tenure at a company is around 18 months. Most caps are about the same timeframe.

Leaving and cashing out PTO is a very common occurrence. Getting acquired also results in PTO being cashed out.

>The only days that cost you are any days that would be paid out at the end of your employment, and even that really only matters if you're going to roll from one job into another in less than the number of days you were paid out at the end, otherwise it's still just a rearrangement of a constant number of paid days and unpaid days.

The paid out PTO is a "sunk windfall". Every day you choose not to work between jobs costs you regardless of whether you had any PTO paid out.

Someone1234 10 years ago | |

Taking that into account now I'm glad my current place of employment DOESN'T pay out PTO. You can accrue about two years worth but after you hit the cap you start to lose the days (just dropped, not paid out). They also don't pay out if you quit.

So I have no valid reason to convert my PTO into dollar amounts, so no specific guilt about using them. It also doesn't make sense for me to save too many as I could be fired tomorrow and lose them all...

PS - My employer does warn you if you're about to lose days at least a month ahead. A colleague took three weeks off last summer because they hadn't used enough in previous years.

phamilton 10 years ago | | |

What state are you in? California requires PTO to be paid out when you leave.

smt88 10 years ago |

Like unlimited free food/snacks, a ping pong table, nap rooms, and many other "unbelievable" office amenities, the unlimited vacation policy seems cynically designed to keep you in the office as long as humanly possible.

NickM 10 years ago |

Obviously this is just anecdotal, but I work for a company with an unlimited vacation policy, and I've actually enjoyed it. I probably average 4 weeks of vacation per year, which is what I had in my previous (non-unlimited) job. But, now if I want to take more vacation one year and less vacation another year, I don't have to worry about whether my plans fit into whatever arbitrary limitations my employer might impose.

I've also never had a vacation request denied, and nobody has ever given me any crap about taking too much time off, although not everyone does take as much vacation as I do.

I'm sure there are companies and situations where "unlimited vacation" does end up translating to "no vacation", but I feel like a lot of the complaints about unlimited policies stem from people who are overly insecure about their careers. If you do good work and are a valuable asset to your employer, nobody is realistically going to fire you for taking an extra week off now and then.

gargravarr 10 years ago |

I think it stems from the limit imposed by the number of days elsewhere; since the days don't carry forward (or if they do, not all of them), you HAVE to use them, which creates incentive to take vacations or you miss out.

And just like anything else unlimited, having it available without pressure to use it is kind of like a gym pass, you COULD go, but do you really want that hassle just yet?

WorldMaker 10 years ago | |

Supposedly "unlimited" vacation with an annual required contiguous minimum can work. "Must take at least two weeks off sabbatical at least once a year." I would imagine you have to be careful to keep that "required minimum" from feeling more like a punishment than a necessary pressure release valve, as with any "mandatory fun" requirement.

noir_lord 10 years ago |

Unlimited with a minimum would be better since you'd have a lower bound and everyone would get at least a sane amount off.

In the UK though we get good mandatory holiday days for FT employed.