Everything you need to know about unlimited PTO

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If you’re in the thick of job searching, you may be surprised to find that many companies — start-ups and established brands alike — are starting to be more flexible with their paid-time off policies. The concept of ‘unlimited vacation’ is becoming more and more popular, and is something a younger generation of talent is starting to weigh heavily in their decisions. In fact, a report conducted by Indeed found the portion of American job postings advertising an ‘open’ or ‘unlimited’ vacation/PTO has grown a whopping 178 percent in the past four years. In May of 2019 alone, there were 1,300 postings per million with this approach, while in May of 2015, there were only 450.

So why the uptick? Career expert for TopResume Amanda Augustine explains employers are constantly looking for ways to differentiate their employer brand from competing companies and attract the best talent, especially in the technology sector, so we’re continuing to see a rise in popular perks like unlimited vacation policies.

With every ounce of good though — hello, two-week trip to Spain! — there are also some downfalls of this policy. Here, experts weight the pro and cons, and let you in on what you need to know about unlimited PTO: 

 

Pro: You can afford to take a real break. 

What’s often difficult for overworked employees is balancing the demands of their job and their personal life. Some companies are so strict about being away from the office that they require their employees to use days for doctors’ appointments, caring for a sick child, awaiting furniture delivery and so on, according to Augustine. This can easily eat away at your vacation days, especially when the American standard is two-weeks a year. But with an unlimited vacation option, Augustine says you have permission to take a half-day or even a full-day off here and there to meet your personal needs, without having to sacrifice a beach getaway. Many employers with an unlimited perspective also tend to be more flexible, and allow you to work from home while that couch makes it way to your front door, too.

 

Con: It can create a strange culture. 

As with any workplace, there will always be varying opinions between employees. Some prefer to be the first ones in the office, while others roll up late and stay way past sunset. With an unlimited vacation policy, a company will quickly discover that some folks take advantage of it, and others judge those who are jet-setting constantly. As industrial-organizational psychology practitioner and workplace expert Amy Cooper Hakim, Ph.D., explains there is sometimes an ‘unwritten’ expectation not to take off more than a certain number of days, and this uncertainty can feel weird. And, perhaps more dangerously, it can fuel resentment among colleagues. “If you sign on as a new employee and take a two-week vacation when others don’t, then the tenured employees may hold a grudge,” she continues. “Some departments may have more stringent unwritten rules than others, and this can create an uncomfortable office vibe.”

 

Pro: You are happier and healthier.

When you don’t have to hang your head low or put on a baseball cap to escape the office for a vacation, you may reap emotional benefits from taking time away from work. In an environment that encourages unlimited vacation, Augustine says studies have found that employees come back from their disconnected trips feeling less stressed, more energized and of course, happier! “When utilized appropriately, unlimited vacation allows you the opportunity to achieve greater work-life balance and personal well-being, something that 53 percent of U.S. employees say is very important,’” she adds.

 

Con: You may struggle with productivity and prioritizing.

If you’ve felt like you’ve been in jail the past few years at your current place of employment, bound to a restrictive paid leave policy, accepting a new job with an unlimited one can feel exhilarating. And much like when a kid receives a new toy, you might want to take more days than you normally would, Hakim warns. In response, your ability to focus and be productive could suffer, thus leaving you with a less-than-stellar review. It’s important to take time to adapt to your new normal, and approach the opportunity with professionalism and consideration.

 

Pro: …but you might also be more productive.

Leaders understand that not everyone performs the same way. Others are motivated by the early hours of the morning, while others can file away deliverables while burning the midnight oil. With a flexible working environment that allows employees to figure out what’s best for their unique abilities and preferences, productivity may actually soar. As Hakim shares, being able to say ‘yes’ will motivate you to stay the course on the task at hand so you can get out of town, stat.

 

Con: You actually take off less time. 

Augustine says, yep, we read that correctly. Much like many American employees with a two-week policy leave their vacation days on the table, believing it makes them look more loyal, unlimited doesn’t always mean more last-minute trips. Augustine explains research complied by the Sage Business Researcher found that in many cases, unlimited vacations encouraged employees to take less than they would with the standard option. “Some employees are concerned that taking what appears like vacation time will damage their manager’s perception of them — and hinder their chances for advancement,” she explains. “Others simply find it more challenging to block time off for vacation without having a specific number of days that must be used, or risk losing them at the end of the calendar year. Whatever the case, unlimited PTO only works if you work it into your calendar.”

 

Pro: You may feel more committed to your employer.

The underlying belief in an unlimited vacation policy is trust. And there’s something powerful about making the values of a company focused on giving employees the freedom they need to be fulfilled and successful. “If your employer trusts you enough to give you free reign with regard to PTO, you may feel more connected to your employer and be more productive when you are at the office,” Hakim shares. “When you feel empowered to take control of your schedule, then you may strive to give back to the employer with top-notch performance. Further, job satisfaction and engagement may be higher in such an organization.”