The Pros and Cons of Unlimited PTO for Employee Engagement

How many of us daydream about month-long vacations on the beach, traveling an ancient European city, or having endless spa days? Unlimited PTO sounds like the miraculous answer, and more and more companies are offering limitless vacation time as a perk. Giving employees the freedom to choose when they need to relax and unplug can be a powerful recruiting strategy as well as a valuable tool to boost engagement.

However, the dream of unlimited PTO may not work for every company. The irony for employees is that without clarity around how much time to take off, they often don’t take any. And this perpetual state of ambiguity could actually hurt employee engagement and productivity.

So, is unlimited PTO worth it? There is no right or wrong answer. It all depends on your organization and culture. Here’s a look at some of the pros and cons that may come with this policy: 

PROS

A culture of trust: Employees appreciate the trust and flexibility they’re given with an unlimited PTO policy. They feel empowered to finish projects on their own timeline and effectively manage their workload. Trust is one of the most valuable assets in the workplace, so employees will feel extra motivated to work hard, keep the trust, and show that they deserve it.

Time to recharge: The more employees work, the less productive they become and the faster they will burn out. Letting people unplug for long periods of time is critical for morale and overall health. And, when employees come back to work, they will be able to give you their full attention.

Equal playing field: Giving the whole office the same opportunity for a flexible schedule will eliminate any sense of hierarchy. Employees may feel resentful if senior colleagues can come and go as they please, but unlimited PTO levels the playing field. And, employees will be more engaged when they feel respected.

CONS

Confusion may lead to burnout: Some employees may feel guilty about taking time off, or may not know when and how long of a vacation to take. They may also feel workplace pressures – if their colleagues aren’t taking any vacation, they will be more hesitant to as well. If it’s too hard to figure out the right amount to take, some employees may just keep plowing ahead, ultimately resulting in burnout.

Loss of incentive: Increased vacation time can be seen as a reward for hard work and good performance. By offering unlimited PTO right from the get-go, you are removing an accumulated incentive for productivity and tenure.

Unrealistic expectations: Without a designated bucket of vacation time, some employees may be unable to step away from their work, especially those in sales organizations or manufacturing companies. They need a formal process telling them to take vacation; otherwise they won’t choose it for themselves. Feeling unable to take vacation and enjoy workplace perks will decrease morale and job satisfaction.

The deciding factor for unlimited PTO’s success is the implementation and communication around the policy. You can’t just introduce limitless vacation and expect it to work its magic on its own – you need to build a culture of trust and transparency so employees feel comfortable and confident to take the time they truly need.

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