Last year I spent a lot of time interviewing with start up companies. Almost all of them offered perks like company outings, free food, and many of them offered unlimited or “take what you need” vacation time. At first thought, this sounds like a dream. But, is unlimited vacation time really the best policy? I think not. And here’s why.
While I love the idea of employers focusing more on productivity and results than face time at the office, one of the unintended consequences of unlimited vacation policies is that employees actually end up taking less time off over the course of the year than those who have fixed vacation allowances. As it stands, Americans are notorious for leaving vacation days on the table. Many workers feel that taking time off will mean missing out on important assignments or promotions or that nobody else will be able to cover for them and work will be left undone. The pressure to stick around is intensified at companies where there is no guideline as to the company’s expectations about how much time is appropriate to be away on vacation.
While companies like Netflix and LinkedIn have preserved their unlimited vacation policies, other companies, like Kickstarter, were forced to rescind these policies when it found that workers weren’t actually taking time off. Overworked employees lead to decreased productivity, diminished creativity, and low morale – a deadly combination.
Instead of offering unlimited vacation, companies should offer generous vacation plans and encourage their employees to actually use their allotted time. One way to do that is to consider how much time an employee has taken off as part of his or her yearly evaluation. Another way is to create minimum vacation times, as opposed to maximums. Most importantly, company leaders must not only remind their employees that it’s important to take time off, but must also ensure that they are walking the walk by taking time off themselves. By showing their teams that even the boss disconnects, employees will feel more comfortable using their vacation time as well.