Workplace

People with unlimited PTO aren’t taking it. These companies are making it mandatory.

From $1,000 vacation stipends to surprise weeks off, here are some creative solutions to burnout.

A set of scales with a heart that reads HEALTH on one side and a stressed out worker on the other

More and more companies across tech now offer unlimited or "flexible" PTO policies, a break from the traditional capped number of vacation days a year.

Illustration: IconicBestiary/Getty Images

Unlimited PTO sounds like a dream come true. You can take as much vacation as you want. But is it really? And can you actually?

These are questions employees are asking themselves as the once whimsical policy has officially entered the mainstream. More and more companies across tech now offer unlimited or "flexible" PTO policies, a break from the traditional capped number of vacation days a year, with job postings listing "unlimited vacation" increasing 178% between 2015 and 2019.

One unusual predicament that these companies are running into: People aren't taking enough vacation. One 2018 study found that employees at companies with unlimited PTO policies took fewer vacation days on average than employees at companies with traditional PTO policies. Without guidelines around how much time off to take, employees are unsure how many days is "too many," and norms end up being set by individual managers, who might not be taking enough themselves.

So what's the big deal if people don't max out their vacation days? For some executives, the problem is burnout. When COVID-19 happened, "well-being became more of an issue," said Leslie Pendergrast, chief people officer of Outreach, a Seattle-based startup that offers flexible PTO and which has instituted some policies to ensure employees actually take enough time off.

The simplest solution: Set a minimum number of vacation days.

That's exactly what they did at Lessonly by Seismic, a software startup based in Indianapolis, which recommends that employees take a minimum of 20 days off a year. That's on top of the two weeks off that everyone gets yearly — the week between Christmas and New Year's, as well as the week of July 4th — and the other observed company holidays.

Lessonly Co-Founder and President Conner Burt characterized the journey of reaching that number (20) as "more of an art than a science." He also emphasized that it's just a recommendation, and that people are welcome to take more or less than that if they want to. "You can't force people to take vacation," he said.

Another campaign that Lessonly tried out at the end of last year when "everyone was burned out": "Take five by 12/5." In October, the company asked all employees to find five days off by Dec. 5. The impetus came when quarterly surveys and check-ins revealed that "it was clear we'd seen fatigue."

San Francisco-based tech company HOVER also set a minimum on its unlimited PTO policy: three weeks. One of those weeks also has to be a full consecutive week off, according to Brit Malinauskas, the company's VP of People & Workplace. According to Malinauskas, the majority of employees are meeting that three-week minimum.

Pay people to take vacation. You read that correctly.

Younger people have embraced the idea of "work-life balance" and taking time off, said Susan Stick, SVP of People and general counsel at Evernote, but for employees who've been in the workforce for a while, "it can be hard to make those people take time off."

As a result, Evernote has taken perhaps the most unusual approach to tackling the problem: The company gives all employees a $1,000 bonus to incentivize them to take five consecutive days off. Nearly three quarters of Evernote employees submitted for the stipend in 2020, according to an Evernote spokesperson.

Mandate a week off for everyone. Make it the same week.

In a recent internal survey, an employee at HubSpot wrote, "Unlimited vacation is great, but not spending your whole day back from vacation going through Slack messages and emails is even better." As a result, the company implemented a "Global Week of Rest" annually, held during the week of July 4, according to a company spokesperson.

The issue of pings and notifications while on PTO is something that Dropbox has taken on as well with its "Unplugged PTO" policy, which allows employees taking PTO to pause access to their accounts via mobile. "The idea is to remove the temptation to have a quick glance at your Dropbox, email, Hangouts, or Slack so that you can truly disconnect," wrote a Dropbox spokesperson in an email to Protocol.

If you can't spare a week, make it a day.

Outreach offers employees what it calls "refresh days" once a month that they can use as time off. It's up to team leaders to decide which day that'll be, but everyone on the team gets the same day off, so the rest is coordinated, according to Pendergrast. They also make sure to coordinate the day off so that people who work together get the same day off: For example, the People team takes the same day off as the teams that they support.

Hover has put a lot of work into manager training to "help people respect time off," said Malinauskas. "Overall, we care a lot about trust, and we think about that in terms of a culture of self-sufficiency and autonomy in decision-making," which is key to an unlimited vacation policy that works, she said.

Perhaps the greatest thing managers can do to encourage time off is to take it themselves. "Leadership needs to model the work culture that you're trying to promote," said Burt.

Or, just don't have an unlimited PTO policy.

Let's be clear: Companies that offer unlimited PTO aren't just doing it to be nice. It's also a smart financial move, since doing so sidesteps the cost associated with paying out for unused vacation days when an employee leaves the company.

Couple that with the recruiting benefit of getting to tout a seemingly fabulous perk, and offering unlimited PTO is a seemingly brilliant HR move. Except when it isn't.

Some companies coming to terms with the pitfalls of unlimited PTO are choosing to ditch it altogether. The new move? Stick with a traditional vacation policy; just make it more generous.

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