Every Question to Ask Before You Roll Out an Unlimited Vacation Policy

I’ve been thinking about implementing this policy for three months. I’ve interviewed dozens of CEO’s who have implemented an Unlimited Vacation Policy to discuss how different companies handle different situations. Next week at the Beyond the Beer Pong and Foosball Tables event, I’ll be discussing the process that I went through to  come up with answers to every Unlimited Vacation Policy question that we could think of. Register for this event at Westland Distillery on October 28!

Why Implement an Unlimited Vacation Policy?

My company is not a tech startup, but because we support hundreds of startups and are entrenched in the startup ecosystem, I gravitate towards and embrace the workplace culture that is on the bleeding edge. I also want to attract employees who thrive in the startup ecosystem and feel like this is one of those things that separate the best from the rest. I also feel that PTO is punitive and traditional vacation and sick leave is even worse. Having an Unlimited Vacation Policy shows your employees that you trust them and allows employees to recharge when they need to. This leaves employees feeling empowered, respected and motivated.

Build With the Long View in Mind

I’m also a firm believer of building the company with the long view in mind. There are no shortcuts when you’re building something that is sustainable. Life is full of changes at each stage of life. When you’re single, there are things that you just want to be able to do and there are fewer commitments holding you back. Once you have children, the world completely becomes different. Suddenly your time off is spent at your kid’s Halloween party, attending parent teacher conferences, staying home with them when they’re sick, or figuring out how to handle summer vacation when they are bouncing back and forth between summer camps. That leaves a person with essentially no time off for actually recovering from working hard and crushing their goals. There are also unforeseen issues that come up in life, ones that no one ever plans for, and I want employees to feel supported in those situations and throughout the various stages of life.

Questions and Roll Play

Here is a list of questions that I came up with. As a team, we spent a few hours (spread out over a week) to discuss and role play the questions.

  • How do you ensure that people don’t take too much time off?
  • How do you ensure that people don’t take too little time off?
  • How do you ensure that people do not become resentful of others who take too much time off?
  • What do you do if your incentives don’t support your goals?
  • How do you ensure that people do not feel guilty about taking time off?
  • What’s a healthy amount of time off to take per year?
  • How much lead time do you have to give in order for vacation to be approved?
  • Should unlimited vacation be tracked?
  • Most unlimited vacation plans have some sort of manager approval step. What systems are in place to ensure there is an equal approval process for each manager to ensure that there is not inequality among teams?
  • If sales people reach their goals they can take off as much time as they like. What about for jobs that are more operationally focused?
  • If you need an extra day to recover from your vacation buffer that it. Nothing sucks more than people that call in sick because they are wiped out, hung over or didn’t rest enough when they took their vacation. Be back in the office when you say you’re going to.
  • Is it okay to just call in sick when you just don’t feel like working?
  • If it just happens to be a sunny day, should you just call in and say, “I’m not coming in”?
  • What if an employee needs to take time off because of something related to FMLA (Family Medical Leave Act)? How does that work with a unlimited vacation policy?
  • How does maternity or paternity leave work with an unlimited vacation policy?
  • Can you take time off if you’re behind on your projects or they are not complete?
  • Do employees feel like they are working all the time even when they are on vacation?
  • Is there a cap on the number of weeks a person can take off at one time? Two weeks? What if someone has something that they would like to take off which is longer?
  • How do you treat existing accrued leave while transition from PTO to unlimited vacation? Payout at termination?
  • How do you ensure that you have a vacation schedule that is fair to all and effective for the business?
  • How can you have an unlimited vacation policy for hourly employees?
  • How do managers arrange with their teams to take time off?
  • The hiring process needs to weed out people that don’t align with our core values and how we operate with a unlimited vacation policy.
  • Is the client or customer suffering?
  • What if I want to take time off but my manager doesn’t approve?

Unstructured or Guidelines?

At the end of our discussion, it was clear that expectations are set and guidelines are in place. This helps people understand what is considered to be acceptable, aligns with our core values, and allows employees to show they really care about their coworkers and the company.

What other questions would you ask if you were implementing an unlimited vacation policy?

2 replies
  1. Jonathan
    Jonathan says:

    You’ve covered a lot of the big questions!

    Here’s one more — how do you ensure that unlimited vacation doesn’t become a “race to the bottom”? In some workplaces with unlimited vacation, employees feel unsure about how much time is actually appropriate to take off. Without a specific number of weeks as an anchor, they look to their co-workers to see how much time they’re taking off, and most people will try to avoid being the one who takes the most vacation. You can see where this is going; the result is that people take off *less* time when their vacation is “unlimited”, and sometimes compete their way into burnout.

    • Peter Chee
      Peter Chee says:

      Thanks for the comment Jonathan. I brought this up as a discussion point with the team and we talked about what is considered to be reasonable. It really does come down to setting expectations. What is the minimum and what would considered to be a healthy top end. I believe that the number of weeks depends on the person. Some people like to push really hard and we want them to have time to recharge. As a team we discussed what would be considered to be reasonable as a guideline and then also discussed that there are always exceptions to the rule. I also looked at the data points for employees who have worked for me over the last 7 years and they have never had an issue of not using all of their PTO. In fact many times people had been exceeding their PTO and running a deficit. With this change I don’t expect their behavior to change.


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