Earlier this year, Virgin Group announced a new policy allowing unlimited vacation time, or in the preferred current corporate nomenclature, paid time off. Virgin is likely the most prominent firm in the world to have moved to such a position, though they aren’t the first–a number of Silicon Valley companies have done something similar, including the very group whose subsidiary is the platform for this blog, Automattic.
Branson’s cache and prominence, though, is what caused a stir in culture: is it a good idea? More importantly, will it work?
The common reasoning is that if employees are permitted unlimited time off, then they’ll abuse the policy, productivity will slide and bottom lines will be undermined by a lazy workforce. Or something like that.
Based on the findings of companies researched by the Society of Human Resource Management, however, perhaps we ought to have a little more faith in our fellow humans.
First, unlimited paid time off, like representative democracy, works best with a virtuous workforce. Perhaps ‘virtuous’ is a loaded modifier, but it works. Unlimited PTO is not an invitation to not show up for work, but rather a sign that an employer trusts its workforce. To wit, why would an employer hire–or retain–someone she fundamentally doesn’t trust?
Decent people deserve to be treated decently, and that includes not hammering someone because he is undergoing treatment for a serious illness (FMLA provisions notwithstanding), or putting strictures on someone who has an opportunity to travel, study or otherwise pursue her interests or a charitable cause.
A company that holds an unlimited PTO policy and fails likely has far more serious issues than allowing its workers to take two weeks to fully recover from the flu.
Second, and not entirely unrelated to the first point, unlimited PTO demonstrates to a workforce that an employer is confident and capable in staffing his workplace. Frankly put, a person taking two weeks to vacate or two months for paternity leave should not mean that a company is then incapable of fulfilling its raison d’etre. Taking the caps off sick and vacation time should spur productivity, which reasonably should spur gross receipts, which reasonably should foster additional job growth. Companies moving toward this model are a classic example of the marketplace adapting to employee’s needs and increased desirability for potential future workers–the free market in action.
Third, in an era when work is increasingly virtual, what is the point of having banks of accumulated time-off hours? Certainly, not all work is virtual, but many people can do far more outside of a typical office than they ever could do before. The aforementioned worker recovering from the flu could theoretically take a few days and then telecommute for a few more until she’s back at full strength.
Fourth, it puts weight behind the clichéd and ultimately worthless phrase ‘work-life balance’. If an employer truly values his employees and their equilibria, he’ll do what is needed to make sure they’re in the best position possible to do the best job possible. That includes being generous and understanding, including (and especially) when people need time off.
People burn out if they’re pressed too hard for too long, and while it is important to maintain standards for performance and conduct in and around the workplace, it is not healthy to leave workers dreading to come back to work after falling ill, needing time to address family situations, having a child, moving to a new residence or seizing an opportunity that otherwise might not be available.
Finally, with great benefits comes great responsibility–some companies reported that those who work in an uncapped PTO environment actually use less time than those who feel like they have to use as much as they can before an arbitrary turning of the calendar resets the banks. Freedom, in workplace praxis, engenders loyalty. Arbitrary restraint, contempt. In this era of jobless recoveries and political and economic chicanery, good employees with great potential and/or track records of performance are worth keeping and taking the necessary measures to demonstrate mutual commitment.