Unlimited Leave: Employer Hacks for Embracing Unlimited PTO

A growing number of firms – including Microsoft[i] – have introduced ‘unlimited’ paid time off as an attractive well-being benefit for employees, but according to Adrian Lewis, Co-founder and Global Lead for Activ People HR these policies need to be carefully thought through to ensure they work for both the employee and employer.

Adrian’s comments come after recent news revealed that a worker was punished by their employer for taking too many days off sick, despite the company offering an ‘unlimited’ paid time off scheme for health or leisure reasons, which led to them quitting[ii].

Adrian says, “Whilst unlimited leave policies can appear on the surface to be a positive thing, there are concerns that they can mask issues such as stress and burnout as some staff may be reluctant to take time off without set boundaries or expectations around what is and isn’t acceptable.

“Equally at the other end of the scale, such schemes can be open to abuse with people taking lots of time off.  Neither of these scenarios is good for the employee or employer. The whole point of offering unlimited paid time off is to provide a flexible and empowering work environment that helps employees achieve a better work-life balance.

“This is why managing and implementing an unlimited time off policy effectively, requires careful consideration. Not least ensuring there are suitable processes and systems in place to ensure full visibility over the workforce so that managers know instantly who is off when to enable the business to always function properly.”

Adrian offers the following top tips for firms considering offering an unlimited time off policy:

1. Set expectations – Without clear boundaries, it can be difficult for some workers to know what is or isn’t acceptable. Some may worry about falling behind if they take time off or that it might hinder career progression, others could abuse the scheme. Creating a policy that states a mandatory requirement for taking time off (4 weeks for example) as well as expectations, eligibility criteria, and the process for requested time off is vital.

2. Clear communications – Ensure the policy is communicated so employees understand what is expected of them. Encourage employees to plan their time off in advance and to communicate their plans to managers and colleagues to help ensure workloads are managed effectively and to prevent last-minute disruptions.

3. Lead by example – Leaders and managers should always lead by example and ensure they take regular time off throughout the year. This can help reinforce a healthy work-life balance and make employees feel more comfortable taking time off.

4. Trust employees – One of the benefits of offering unlimited paid time off is that it promotes trust across the organisation and lets staff know their employer has faith in them to manage their time effectively and responsibly. This helps build a positive workplace culture and a sense of empowerment which can boost performance.

5. Focus on results and accountability – Shifting the focus from the number of hours worked to results and accountability is essential when offering unlimited paid time off. This means clearly defining goals and expectations for employees and holding them accountable for meeting their targets and delivering quality work.

6. Use digital systems –. Using digital systems to record and track all types of leave is essential so managers can monitor employee’s behaviour. This ensures people take regular holidays as well as record sick days accurately. This can help prevent burnout and stress as well as enable employers to spot red flags during back-to-work interviews after a sick day, which digital systems will prompt.

Digital systems also provide oversight over the entire workforce to ensure workplaces are adequately always staffed. They can also help with accountability with solutions for ensuring performance reviews and appraisals are carried out regularly.

7. Celebrate and communicate – To maintain trust and demonstrate the impact of the unlimited time off policy it’s a great idea to share positive stories about people who have benefited from the policy. Also regularly reminding employees of the importance of taking time off and the policy guidelines is important. Highlighting the value and success of this benefit can promote better staff engagement.

8. Regularly review – It’s important to stay informed about trends and best practices as regards these types of policies, as well as listen to the workforce and get their feedback. It may be that this isn’t having the desired effect on wellbeing or staff don’t value this benefit so be willing to adapt and evolve the benefits package to meet the changing needs of the workforce.

Adrian concludes, “These tips can help employers introduce unlimited paid time off policies and create a culture of trust, flexibility, and a better work-life balance for all. This can increase employee satisfaction, productivity, and retention which can in turn improve the firm’s performance. A win-win for everyone, as long as it’s managed correctly.”

For more information on Activ People HR visit: www.activpeoplehr.co.uk.

[i] https://www.theguardian.com/business/2023/jan/22/unlimited-holiday-time-vacation-pto-small-businesses

[ii] https://www.hrgrapevine.com/content/article/2023-06-27-firm-offering-unlimited-leave-punishes-worker-for-taking-too-many-sick-days