How to Make the Most of an Unlimited PTO Policy
The policy, which allows employees as many vacation days as they want, seems great. But if you're not proactive, you won't reap the benefits.
A few years ago, Sebastian, a 44-year old IT specialist in New Jersey, heard that his then-employer would be switching to an unlimited paid time off leave policy. He was psyched.
“It sounded like a great idea. But taking days off still required the approval of management, which was discretionary,” says the father of one. “Changing the policy didn’t increase the number of days off anybody was taking. I came to think of it as a scam.”
Sebastian switched jobs and now works for one of the biggest tech companies in the U.S. He says he’s much happier with the company’s very generous current policy: five weeks of paid time off per year, fixed.
If you’ve logged on to LinkedIn, Indeed, or any job search forum lately, you’ve surely come across the biggest buzzword in benefits: Unlimited PTO. That is, unlimited paid time off. Instead of having, say, 10 vacation days per year along with five personal days and five sick days, each of which you or your manager would need to track and tabulate, an unlimited PTO policy lumps them all together, without topping out.
“The first time I heard about the policy I nearly jumped out of my chair,” says Dr. Kaumudi Misra, an Assistant Professor of Management at Cal State East Bay. “How is it possible? How can a business run if employee’s vacation days are unlimited? Of course, what I found was that ‘unlimited PTO’ isn’t one thing. It’s many things.
Unlimited PTO policies aren’t just one single black-and-white policy. Every company can implement it differently. “There are good iterations of it, and bad iterations of it,” says Dr. Misra.
For parents, unlimited PTO policies are great — in theory. “There’s a positive relationship between flexible work arrangements and parental involvement,” says Dr. Kevin Shafer, an Associate Professor of Sociology at BYU. “When parents have control over when they work, how they work, and where they work, ultimately that means positive outcomes for children. So, in that way, unlimited PTO can be great.”
While corporate HR heads want their employees to be healthy and happy, there are other motivations for implementing unlimited PTO. It’s a recruiting tool, for one. Putting the buzzy term in a job posting can be an effective lure for potential job candidates. A study released earlier this month by Prodoscore, for example, showed that while 27% of Americans either left their job or plan to rather than work in an office, 30% of respondents would return if unlimited PTO was on offer.
But the bigger reason we’re seeing a rise in unlimited PTO is that they can save money. In most cases, companies that switched to an unlimited PTO policy no longer need to pay for the people-hours spent tracking time off. And in states where employees who leave a job get paid for unused vacation days, companies no longer have to shell out when you quit.
HR departments might also like the policies because, well, the idea of “unlimited” hasn’t exactly created the wild west of workers taking vacation every other week. Instead, when given the policies, American workers have taken even less time off: a 2018 Namely study showed that workers without an unlimited PTO policy took 15 days off, while those with them only took 13.
So, with that statistic, we see unlimited PTO for what it is: a big gray area. Even if you are entitled to unlimited time away, there might be a strong work culture against taking it. Some might see that taking time away suggests that you’re not serious about the job. You might be judged for taking leave, or you might get passed over for a promotion, depending on how the policy is used at a firm.
“Unlimited PTO policies only work insofar as the company culture allows them to work,” says Dr. Shafer.
So what should you do if you’re considering a job at a company that offers unlimited PTO — or you already took one? Here are some pointers.
Read the Rules
It’s important to know exactly what the paid time off policy is for your position — or the position you’re currently interviewing for. Some companies have an unlimited PTO policy with different qualifications for different jobs or levels, and at some workplaces, specific jobs have precedent over others when it comes to requesting time off. Before you do anything else, find out the policy’s black-and-white details.
When you’re planning to take time off, set up a meeting to talk to your manager, and come in prepared. “You want to go into the meeting with a mental map of how long you’ll take off, along with the options that could be taken to cover for your duties while you are out,” says Shafer. By displaying some foresight, you’re more likely to get an enthusiastic approval from your manager, rather than an approval with some side-eye. It may help to have a few of your recent “wins” for the company on mental file, should you feel you need to remind your boss how well you’re doing.
Share Some Details
If you explain why you’re taking time off, you might be more likely to be met with understanding from a manager. Not that this is right — you deserve to take off for whatever reason you want — but the transparency might help align your bosses’ interests with yours.
Interviewing? Have an Open and Honest Conversation About the Policy
Sure, when the HR recruiter says “Do you have any questions for me?” and your first impulse is to ask for details on how employees use the unlimited PTO policy, it can seem awkward. But it’s a fair question. If you’re doing an extended series of panel interviews, as with many tech companies, you can ask another employee in the department to tell you how they utilize the policy, and how they see others use it, too. Ask around and you might get a sense of how family is viewed in the workplace.
Take the Days Off
If you take a job with unlimited PTO, or have one now, make the most of it. Americans leave nearly half of their vacation days unused — in fact 200 million days are lost annually by employees who can’t roll them over. That’s not a problem with unlimited PTO policy. However, when you do have one, you can still make the mistake of not taking time off to recharge or care for your family.
“In the US, we think if someone’s highly invested in family caregiving, they can’t possibly be highly invested in their job,” says Dr. Ellen Kossek, a Professor of Management at Purdue University. “But more men and women today are what I would call dual centric — they have high centrality in both their work role and high centrality in their family role.”
If it’s implemented well, an unlimited PTO policy could help with both.