Unlimited PTO: Boon Or Bane?

10 business heads share their stance on offering unlimited PTO

1. Offer Flexible Time Off Instead
2. Keep a Solid Structure
3. Remember, Managers and Teammates Bear the Burden
4. Provide a Fixed Amount of PTO Instead of Unlimited
5. Attract the Best Talent with Unlimited PTO
6. Experiment Before Deciding on a Policy
7. Ease the Burden on HR
8. Build Trust First
9. Examine the Organization’s Needs
10. Foster a Work-Life Balance with Guidelines

1. Offer Flexible Time Off Instead

The problem with PTO is employees' pressure to use the time off or lose it if they don't. Pressuring employees to take time off when it isn't always convenient for them defeats the purpose and makes them feel like they have no control over their own free time. Instead, we offer Flexible Time Off (FTO), which allows our employees to take time off when needed and not when it fits into the schedule of the rest of the office. FTO means our employees are more engaged and productive, and the burnout rate has decreased significantly. Offering your team members control over their time off will allow them to take care of themselves on their own schedule when they feel they need it most.

Anthony Martin, Founder and CEO, Choice Mutual

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2. Keep a Solid Structure

When we tried offering unlimited PTO at our company, we found, to our surprise, that some employees took less time off. Our employees like clearly defined policies, and the idea of unlimited PTO causes confusion and uncertainty. For example, an employee might be afraid of taking too much time off for fear of what others might think. We also noticed that unlimited PTO was a source of tension in our workforce, with employees resenting those who appeared to be taking more time off than they did. We have now returned to a fixed PTO policy which works much better for us because it ensures that every employee has the same number of paid vacation days, eliminating ambiguity and potential resentment.

Shawn Plummer, CEO, The Annuity Expert

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3. Remember, Managers and Teammates Bear the Burden

We don't offer unlimited PTO at our company. While unlimited PTO may seem like an attractive perk for employees, it can actually lead to increased stress, decreased efficiency, and reduced overall productivity in the workplace. Managers no longer clearly understand when employees will be out of the office, making it difficult to plan and schedule necessary work tasks. This can cause last-minute absences, which can disrupt workflow and reduce productivity as team members scramble to cover the work of their absent colleagues. Instead, we have a clear PTO policy that includes a set number of paid vacation days, as well as personal and sick days. This structured PTO policy allows our employees to have the time off they need while also ensuring that our company meets its goals in an orderly fashion. So, unlimited PTO will make it harder for you to plan for absences and manage workflow, leading to potential disruptions and reduced productivity.

Maria Harutyunyan, Co-Founder, Loopex Digital

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4. Provide a Fixed Amount of PTO Instead of Unlimited

American companies often offer little to no paid time off compared to European companies with very strict PTO policies. As an American company operating worldwide and with a majority of European employees, we found we had to set a specific amount of PTO to ensure that our employees didn't feel the pressure of working endless hours and being uncomfortable with seemingly unlimited PTO. Often, employees feel that they have to “prove themselves” by not taking any time off, and unlimited PTO was not the right choice for us for this exact reason. With generous but limited PTO days, everyone knows they need to use up their 38 days every year, and it allows them to have four longer vacation stints rather than only taking a day or two off if they felt they had to prove that they were working hard in an unlimited time of the environment.

Gordana Sretenovic, Co-Founder, Workello

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5. Attract the Best Talent with Unlimited PTO

We offer unlimited PTO at our company because we believe in creating a culture where employees are free to make their own choices about how they work and how much time they spend at work. By offering unlimited PTO, we enable our employees to set their own schedules and work to their own abilities, rather than being tied down by the strictures of a traditional workplace. This allows us to recruit the best talent by attracting them with the freedom that comes with a flexible schedule. We've found that when people know they can take time off when they need it, or come in early if they're feeling productive, they're more likely to be happy at work and more productive overall.

Rengie Wisper, Marketing Manager, Check CPS

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6. Experiment Before Deciding on a Policy

We have been offering unlimited PTO in our health and wellness start-up for the past year. We started with a small experiment before deciding to adopt the policy fully. The main reason we do this is to enhance the overall employee experience. The idea has helped us maintain strong morale, high engagement, and more productivity as well. We have also learned several lessons as well from our experience. For instance, for a PTO policy to work smoothly, there needs to be a well-coordinated, employee-led scheduling strategy. Organizations must give employees much more leeway to work directly with HR to plan leave days and work schedules. It is also essential to empower employees to undertake tasks remotely as much as possible. Some of our employees on PTO pop in once or twice a week to do small, urgent tasks remotely. So, they need to have the tools to make this happen while on vacation.

Erik Pham, CEO, Health Canal

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7. Ease the Burden on HR

We offer unlimited PTO at our company, but we don't enforce it. There's no policy that requires employees to take a set amount of vacation days each year. Instead, we trust our employees to manage their time off responsibly. The benefits of unlimited PTO are obvious: it gives employees total freedom to manage their time however they see fit. It also reduces the administrative burden of tracking employee vacation days and ensures that employees don't feel restricted by a strict PTO policy. But unlimited PTO isn't without its downsides. Giving employees total freedom to take time off whenever they want can lead to scheduling problems and a backlog of vacation requests. This can lead to scheduling conflicts and delays in getting important projects finished on time.

Luciano Colos, Founder and CEO, Pitchgrade

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8. Build Trust First

Being a relatively new small business, we are not offering unlimited PTO. This benefit is currently outside our budget range. We also have just enough employees at the moment to provide sufficient coverage during office hours, especially peak hours, so leaves need to be scheduled with thought and consideration. Because we are new, we are still building a culture of trust between our employees and management, so employees become responsible and do not abuse an unlimited PTO policy should we implement it in the future. Management must also learn to trust that employees will use their time off in a way that is in the best interest of both the company and the employee.

Peter Hoopis, Owner and CEO, Peter Hoopis

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9. Examine the Organization’s Needs

We believe that the decision to offer unlimited PTO is a very complex one, and depends on the specific needs of each organization. We offer unlimited PTO with a requirement for employees to take a minimum of three weeks off. If you have a large hourly workforce, unlimited PTO may create additional challenges and things to consider.
	Tawanda Johnson, HR and DEI Consultant, Sporting Smiles

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10. Foster a Work-Life Balance with Guidelines

Unlimited PTO sounds great, but it's a double-edged sword. It can create confusion and tension among employees. The lack of a simple structure can make employees feel unsure about what they consider an acceptable amount of time off, leading to anxiety about taking too much and potentially damaging their reputation within the company. Without clear guidelines and usage policies, it becomes challenging to ensure that all employees can take the time they need to recharge and re-energize, leading to burnout and decreased productivity. For these reasons, we have chosen not to implement an unlimited PTO policy at our company. By offering a structured approach to time off, we foster a positive work-life balance for our employees and maintain a productive and engaged workforce.

Piotrek Sosnowski, Chief People and Culture Officer, HiJunior