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Submitted by robin_s on


BLUF - I'd like to hear from anyone who has experience working in a company that has no parameters for paid time off for salaried employees.

Background:  The leadership team at my company is currently discussing future changes to our benefits package.  One of the proposals on the table for paid time off is "no parameters" for salaried employees.  In other words, you come to work and get your job done.  If you want to take a vacation, stay home sick, take time off for bereavement, or what have you, you make arrangements with your boss, and take the time you want/need, as long as you get your job done.  The benefits to the company are no accruals, and potentially less time off than is currently being used.  It's a trust-based system, with responsibility on the managers to make sure the work is getting done.

I personally find a lot to like in this system.  I think it would send a strong message to the employees that they are trusted and very highly regarded as professionals.  I can imagine there might be some who would take advantage of this, but I think it would be a small minority. 

Any thoughts?  I'd especially like to hear from anyone who has experience with such a system, but also thoughts from the community in general.

Anandha's picture
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This sounds like the Netflix policy...  Don't have personal experience in this. It does sound very appealing.

See here and here.

The full Netflix pres is an interesting read as well. 

Good luck, Anandha

canuck's picture

I worked a company who had something similar except for the annual leave part.   All sick leave, etc was on the honor system negotiated with managers.

I wasn't a manager then so I don't have direct experience, but as an employee I thought it was very forward thinking and I never heard of anyone taking advantage of it or even employees discussing taking advantage of it.

I would think that if anyone was abusing it, there are other performance metrics that can be used to get them out of the company. 

Let us know how you go.


AspirationM's picture

It probably depends on what you manage or do how well it goes over.  For most people that's going to feel great to see.  But it could be taken badly by your employees who are in a less fun situation when compared to other areas.  It's a hard one to handle in, say, a support environment where you have to cover time periods.  At that point whether you're doing the work well is in large part dependent on you being available between X and Y o'clock to take calls, do tickets, etc.  Though I could see it opening up a lot of telecommuting options at least.  Which I think is reasonable.

DISC 6127



robin_s's picture
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The way this option is being discussed now, it would only apply to salaried employees, which in our company are only those who are team leaders and above.  We have quite a few individual contributors as well as support personnel who are paid hourly, and who would be on a more traditional paid time off policy.  Depending on how it is communicated, I can see that causing hard feelings between people who currently have the same benefit package.  It isn't practical to have a "no parameters" option for the entire company, as the majority of employees are hourly production workers.

naraa's picture
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 A friend of mine used to tell his kids: "Choose any occupation you want but choose one that will suit the lifestyle you want to have."  

Not everybody can have the same, and not everybody wants the same.  But it is sad that those that could, cannot because corporations make the decisions: "well if some cannot have it, then nobody will."  People are responsible for the decisions and for the positions they put themselves in.  What is sad to see is that more and more people are looking for other options because companies have not been able to find the proper metrics that reward transforming knowledge into results.  My opinion is that the traditional system of doing that in terms of the hour one puts in being physically at the place you are supposed to be doing it is very inefficient.   So any move towards something alternative if find a good move.  Even if there will be some mistakes and pitfalls along the way and that not everyone will be entitled for it.  That´s part of life.

As the Paretto´s rule go: "80% of the result is obtained with 20% of the effort."

I think such a system of no parameters for paid time off can work when the results the company wants are also the results the person responsible for them wants for him/herself.  While I do believe there are people out there who will truly dedicate themselves to the results of the corporation regardless of whether there is something in it for themselves, most people are more productive and motivated when they see the gain for themselves.  Not necessarily money.  I find that that is true for myself.  I can be a lot more productive if I can see that the effort I am putting in is not only increasing the revenue for the company I am working for but also that I am enjoying it and I am learning and growing professionally and as a person as a result of that effort.  I don´t know what is going on in everyone else´s minds, but those I have been able to get a glimpse of have not been that different.... only what motivates them and what makes them like what they are doing has been different.

ajhoffman1021's picture
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Most companies that I've worked for don't really track personal time (sick, bereavement, etc) and only track vacation.  For the most part that seems to work and I've always been able to work with my management to negotiate extra time on a case-by-case basis (which is a tradition I have carried on now that I'm in a management position).

carguin's picture

Our policies have been slowly changing to this approach. The idea is simple... 99% of the people are gonna be honest and do the right thing, and you should be fair by them. The few bad apples who abuse this policy will need to be managed, and that is best done by managers, not by broad policies.


Chris Arguin

jib88's picture

I think the policy is fine for sick time, but not for vacation. It's almost palatable because it's only for management-level employees. Overall I think it can send the message that people should not take vacation though. It certainly makes it harder as a manager to ensure your people are taking the vacations and breaks that they need to take. If they have a set amount of vacation time then you can more easily monitor them to a certain standard.

Maybe it's just because I've become accustomed to getting a set number of days. And maybe a flexible policy like you describe would be good for recruitment and retention. But I've been with the same company a while, and at 6 weeks vacation I'm pretty happy where I'm at.

matthenretta's picture

I am part of the management team that decided to implement a policy like this and while we are only one year in it has been a great success on many levels. Employees are very happy with the policy, the abuse has been virtually non-existent (even with a strict policy there is always some abuse, and we have seen a pattern where, on average, our people that are very highly utilized are the ones taking the most vacation which is great because we absolutely don't want burnout.

A few other things to consider as you think about this policy.

- To be successful, expectations of what work needs to be done has to be clearly communicated and understood (this should happen regardless)

- When you do identify abuse it needs to be addressed, not ignored

- When you identify people not taking vacation you should ask why and ensure that aren't too worried about doing so. Not enough vacation will result in poor performance, less job satisfaction and increased turnover to name a few

- We have found calling this "unlimited" vacation sends the wrong message. Rather "self managed PTO" with the intent of enabling everyone to find a work life balance that is good for them

- Don't forget the change management aspect. This is new and to some very odd. There will be LOTS of common sense type questions but you need to take the time to address them all. Most importantly, be prepared to discuss how compensation may be impacted (e.g. if someone is meeting expectations while taking lots of PTO they should not expect a performance bonus while someone exceeding expectations while taking lots of PTO may still get a performance bonus)

robin_s's picture
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This appears to be an idea whose time has not yet come, as a majority of our management team did not support it.  I had mixed feelings but like the concept.  I appreciate everyone's input, as I'm sure it will surface again in the future. 

dennis_sherman's picture
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Maybe I should be looking for work elsewhere.  All the concern I've seen expressed in this thread is around fear of employees abusing the system and taking too much time off. 

My concern would be that without an explicit time off policy, the work assignments would mount to the point where meeting deadlines is impossible if any leave time is taken. 

Yes, I understand about delegation, and I understand the juggling koan, and I understand the material in the "handling a sudden increase in workload" podcasts. 

There is still at some point a limit beyond which a given team can't accomplish any more.  An explicit leave policy provides at least a little ammunition to argue up the food chain that we have to give people time off.  It also gives me additional ammunition to encourage my driven direct to take time off before the "use it or lose it" deadline.

Dennis Sherman

Waterford's picture

My company parses up x number of days vacation and y number of days personal, z sick days, etc, but my department has never ever had the time to track such things.  We have a great team where respect for each other is abundant and communication is open.  We would never abuse our time off for fear of losing that respect or being called out on the carpet! 

Question I have:  will the baby-boomers with 5 weeks accrued vacation feel like they've lost something now that there's no concrete differentiation between them and their millennial counterparts? 

LFinkle's picture

I've had several clients that used this approach.  When the company was small (say under 25 employees) it seemed to work well.  Everyone was motivated and committed to the success of the company.  As they added more employees it became a problem.  Not everyone is mature enough to know how to work well in this type of system with no structure.  The challenges turned out to be many.  Some took advantage of the system.  Others complained that colleagues were taking advantage or felt they couldn't take as much time off as their roles demanded something different from them.  Sometimes most of the team took off on the same day which played havoc with schedules among other things.

I'm not saying don't do it.  Just know in advance the challenges will be many.  The likelihood of having a mature enough staff to consistently make this situation work well is not great.  People are people and they will always compare themselves to others and feel unhappy if others are taking more time off than them...for whatever the reasons and whatever the productivity is.


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mauzenne's picture
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It's the policy at Manager Tools ... and works like a charm. :-)


dylansmith088's picture

 I would say it needs to be tried out. It is often easy to forget that trust based systems are likely to work more effectively and I for one am all for them. The management cannot always be at loggerheads with the employees to get work! That is just ridiculous.A method that makes the employee responsible for himself and the project after all isn't that what everyone wants?

gpeden's picture

 "Can I share something with you? When you decide to go on a road-trip to Burning Man the day before before the deadline here is what happens...."....

I can get behind the notion of not having a set number of days / hours of PTO.  Especially if that policy is a 'use it or lose it' which in my experience can lead to 'forced' time off and leave you short staffed.  

As a practical matter - regardless of an 'official policy' or not - I have found it effective to agree on guidelines as far as how much notice you give before taking time off.  This isn't so  much about being treated as an 'adult' as it as about making sure the business can continue to operate.  My (general) guideline is 1 week notice for 1 day off, a month notice for  a week off, and quarter notice for longer.  And there are always exceptions. Think it as 'professional courtesy' if you like.




DiSC 7511

mattpalmer's picture

I'm in the camp that believes that the real problem with this system isn't that people abuse it by taking too much time off, but rather that your good people don't get any play time, which only leads to burnout and unhappiness.  The idea I've had for a while (and which I'm keen to institute in my organisation, even without unlimited PTO) is that in order to get an "acceptable" performance review or higher, you've got to have taken a contiguous two-week block of leave in the 12 month period preceding the date of your review.  No rest time, no good.  You then just need to make sure you're not the one that's forcing people to not take holidays.

GlennR's picture

quoting my cousin the farmer.

The concerns raised by those who have not experienced this program, are non-existent in my organization.

We've went to this PTO bank 10 years ago and have 600 employees now. There have been no problems that have risen to the level of senior management. (I know because I are one.)

There are two key differences between this program and the prior program. 1) No separate pool for vacation and 4 or fewer sick days. 2) No reason needs to be given for the PTO request. You can take a day off to go to the beach, take care of personal business, or be sick. The supervisor receives a request for time off and makes a decision based only on whether or not the office will have adequate coverage in that employee's absence and whether or not the employee is currently in good standing and up to date on work.

If you're out sick, you notify your supervisor. Our program runs on a calendar year. The more seniority you have the more PTO you accrue. You can carry over 10 days to the next calendar year which must be used by June 1. We're a nonprofit so we don't buy back PTO like some corporations do.

This program is liked much better by employees who remember the old way, is easy to track and monitor through our online payroll system, and provides more flexibility for those who have extenuating circumstances. BTW, illnesses of 5+ continuous days come out of a separate sick leave pool.