I’ve always been fascinated by the concept of unlimited vacation and how it may play out in a workplace. Sounds like a great perk, doesn’t it? If you as an employee can get your work done well and on time, then by all means take an extra-long weekend or head off on that month-long vacation you’ve always dreamed of. As an employer, great candidates would be lined up outside your door. Netflix was an early pioneer of this concept – their HR strategy is smartly summarized in this archived slide deck:
But, what’s in in for employers? One idea tossed around is that employees will be energized and driven to perform because they can self-reward by taking time off, resulting in increased productivity and retention. Another idea is that it attracts self-regulating employees (a premium bunch) who thrive with autonomy, resulting in a stronger workforce. Still another is that those employees will simply have to maintain remarkable performance because, frankly, there will be a long list of qualified candidates eager to replace them … and there’s the rub for employees. There’s even a financial argument that when you don’t prescribe vacation entitlements, you don’t have to pay out unused vacation time later. (By the way, that’s incorrect in Alberta and likely throughout Canada.)
The reality is that there is no perfect solution. If you gain a little here, you’re probably going to pay a little somewhere else. As the unlimited vacation models become tested, we’re starting to see unforeseen consequences including, ironically, employee burn-out.
As an employer, it is important to be creative and nimble, and to listen to your employees and the market. But don’t overlook or forget about the basic tools either including legislative compliance. Understanding the impact of your model from a variety of perspectives including legal, financial and engagement engagement will help ensure success of your new strategy.
Unlimited vacation time sounds like a great way to encourage employees to take time off—at first.