Get More Work Done by Giving Employees More Time Off?

As organizations work to increase employee satisfaction and productivity through wellness efforts (see last month’s article on creative wellness opportunities), a new strategy has emerged: unlimited paid time off (PTO). The name is terrifying to some HR directors, but the concept is pretty simple. Employees are free to take as much time off as they like, as long as they get their job done. By offering to let employees manage their own vacations, you change the focus to producing great results, rather than just being at the office. It’s a subtle yet significant shift in mindset.

Our own Director of Delight, Scott Grausnick, said in a recent interview that happy and healthy employees are more productive. “If they’re doing their job, allow them to be flexible; allow them to be happy.” Leaders at other organizations have found similar results. Nathan Christensen, the CEO of Mammoth HR, offered unlimited PTO for one year to see how it worked for his team. The results were surprising. His employees took LESS time off than in previous years. How did this happen? When asked, employees said that because the company trusted them to manage their own time off and recognized that they had responsibilities and interests outside of work, they felt more engaged with their job, and they wanted to be at the office more often.

Unlimited PTO can greatly improve your overall workplace culture, but to be effective, it must be part of a larger, holistic approach to making your employees happy. With that in mind, here are some tips to successfully roll out an unlimited PTO policy:

Flexible policies do not mean nonexistent policies.
Allowing your employees to manage their own vacation time still requires a formal policy for everyone to follow. Who do they inform about vacation time? How much lead time is required? Who will be responsible for their work when they are gone? Make the expectations and responsibilities clear for your entire team.

Consider calling it something other than “Unlimited PTO.”
Obviously, there are limits to how much time employees can be away. If they’re not completing their work, it’s more likely you’ll be offering them a permanent vacation instead of an unlimited one. The goal of this vacation benefit is to empower your employees and show them that you trust them. Maybe consider using terms like “flexible” or “personalized” instead of “unlimited.” At Harbinger, we settled on calling it Managed Time Off (MTO). It works great for us.

Make it clear that unlimited PTO comes with responsibilities.
If you’re going to invest in the happiness of your employees, they need to be willing to invest themselves into their work when not on vacation. Set the exceptions that work needs to be done completely and on time, and that colleagues do not have to sacrifice their time to do your work.

As work-life balance becomes more important, yet more elusive than ever, offering a benefit like unlimited PTO may be the answer you’re looking for to improve engagement, workplace culture, and productivity.

We’d love to talk to you more about how our unlimited PTO policy has worked for us. We look forward to hearing from you!