The increasingly popular concept of unlimited leave is still a new concept to many and has many gray areas with limited defined boundaries. This begs the question regarding how unlimited holidays work. What companies have adopted it and is unlimited leave really a good thing? Let’s dive in to see!
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How unlimited holidays work
Unlimited holidays is a strategy where workers are given no set number of days off annually. There is no tracking of the number of holidays taken by a worker. Technically, workers can take as many paid days off as they want, whenever they want. Realistically, this will need to work in conjunction with business needs and deadlines. With unlimited vacation policies, carrying over holidays no longer exists. Employers are no obliged to reimburse staff for untaken vacation leave. Some companies have established a policy while others have no vacation policy whatsoever.
In a study of American workers, 53% stated that a job that allows personal wellbeing and work-life balance is important. Source
This concept of nobody tracking your holidays and getting paid to go on leave seems too good to be true. So, is it as good as it sounds to be? Below, I delve deeper into how unlimited leave really works with facts and examples of popular companies who have this policy. Plus, get an insight into the benefits and drawbacks for both the employer and employee of unlimited leave.
What are unlimited holidays?
Unlimited holiday policies shift the responsibility of managing time off onto the employee. They become responsible for deciding how many days off they take in the year along with when and how often they take this time off. It will generally need to be approved first by their manager.
How unlimited holidays work?
Unlimited holidays work similar to a standard holiday policy. The primary difference is that your number of days leave is not capped.
One thing to note about unlimited leave is that it generally isn’t unlimited.
The expectation will still be that you will need to request time off from your manager. Don’t expect to be able to just swan off on a 3-week holiday with hardly any notice or approval.
If deadlines are approaching or you’re heading into a hectic season, there will be an expectation that workers respect the policy and put business needs over vacation.
Which is an acceptable expectation…
Similarly, if there are multiple people in a small department requesting annual leave at the same time, there will often need to be compromise to ensure an adequate number of staff members are available.
That means time off needs to suit the annual leave of others to avoid overlap.
For some companies who rely on manufacturing output or have a small workforce and need 24/7 customer support, such policies may be more difficult to implement.
This might mean that only office staff can avail of this policy while workers on the floor may need a more structured holiday leave approach.
For most people, transitioning to an unlimited leave policy shouldn’t feel much different as some constraints will always be required to keep the business running.
If some form of vacation policy exists, this can make it easier and clearer to everyone what the expectations are regarding when you can take leave.
Is unlimited time off a good thing?
Unlimited time off doesn’t work for every company. But when it does work, it’s usually due to the nature of the work, how well it is setup and because people are engaged with the program. It can be a phenomenal advantage to both the employer and employee as it boosts morale, wellbeing and trust.
There is still a relatively low uptake of unlimited vacation, which leaves us with limited insight into the pros and cons of unlimited holidays xxx.
The unlimited vacation policy will be seen by most workers as a massive advantage to their role.
US workers who have no statutory annual leave entitlements could be one of the biggest gainers of the no vacation limit policy.
Globally, an epidemic of burnout and inability to disconnect from work is draining the health and wellbeing of workers. In such scenarios, unlimited vacation can give a worker the time they need to recharge and attend to their health.
Plus, if you know you have time off that you can take, you’ll be more motivated to get the work done faster to ensure that you can justify taking time off.
Trials have shown that some companies benefit from a 20 – 40% productivity boost from a 4 day work week or reduced work weeks.
50% of workers in a survey stated they would rather unlimited vacation over a higher salary.
Unlimited vacation policies could be the deciding factor that makes a worker choose one company over another. Even if the salary is slightly lower! This makes talent acquiring and retention easier.
It’s not all positive benefits from unlimited leave though…
Some companies struggle to implement an unlimited time off policy. A small company with a low staff count might already be feeling the pinch when workers take leave. Adding even more time off would only exacerbate that or warrant an increase in headcount.
When no vacation policies exist, it can often become more difficult to take time off.
Perception that you are abusing the system can develop when there’s no clear expectations. Additionally, managers who don’t support the model can leave workers feeling reluctant to requesting time off.
This could lead to burnout and people taking even less time off than before.
What companies have unlimited holidays?
Some of the most famous companies that have implemented an unlimited holidays strategy include:
- General Electric
- Oracle Corporation
- Sony Electronics
Having an involved and energized workforce will normally lead to a productivity spike in the workplace. One of the first companies was Netflix to introduce a “no vacation policy”, to improve the productivity and wellbeing of their workers.
Tip: Unlimited leave policies should be clear and specify business needs and expectation.
With the right structures and engagement in place, unlimited holidays can work seamlessly.
This strategy does come with drawbacks, many of which can be addressed by implementing a vacation policy and managing expectations.
But considering that Netflix took years to reap the benefits of the no vacation policy, it does take time, effort and engagement from everyone for it to truly work.
The unlimited vacation strategy is only one of many methods that can be employed to grant workers a greater work-life balance while enhancing productivity. I’ve written about the other popular strategies below.
Here are some other useful articles I wrote that you should go check out:
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- Does 4 Day Work Week Save Companies Money? + Proven Results!
- 4 Day Work Week V 5 Day – Full Of Surprising Facts & Results
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- What is the 20-8-2 rule? – A Simple Guide!