Unlimited vacation days:   the newest fad of startups

Cool, the breezy air carrying the salty, fresh smell of the ocean.

Lovely, green fronds of palm trees tousling lazily in the wind.

Warm, white, fluffy sand. Crystal clear Caribbean water.

And, you, in the middle of it all, sipping on a cool pina colada.

While this beach scene may sound like a mid-day office daydream, we all know that vacations are a superior way to relax and recharge our minds.

And relaxation is just the tip of it— there are numerous health benefits from regular vacations:

With the effects of proper vacation time so beneficial and important to health, the popular startup fad of “unlimited vacation days” sounds like a dream come true.

With endless vacation days, a mid-day office Caribbean daydream could become reality, 3 times a year.

Unfortunately, what tends to happen with these “no policy” vacation policies is that employees end up taking less time than those with fixed vacation policies.

The “No Policy” Policy

What does unlimited vacation days mean, exactly?

“Our vacation policy is ‘take vacation’,” says Netflix, one of the first notable American companies to implement an unlimited vacation policy. “We don’t have any rules or forms around how many weeks per year.”

Netflix’s ‘no-rules around vacations’ approach seems generous given almost 25% of U.S. companies offer no time off.

Virgin CEO Richard Branson also has implemented an unlimited vacation policy for his company. “Treat people as human beings, give them that flexibility, and I don’t think they’ll abuse it,” commented Richard on the policy.

Traditionally, employees are allotted a certain amount of vacation days per year.

“The average American worker receives 10 days of paid vacation per year. European countries, by contrast, mandate that employers offer at least 20 days a year. Some EU countries have even upped the requirement to 25 and 30 days.” — source

Compared to other countries, the U.S. average is a pretty measly number. Furthermore, these 10 average days are not even guaranteed — there is no law on minimum vacation days, it is up to employers to determine those numbers.

With such sad statistics, it is no wonder why some companies have decided to make a dramatic statement about changing the way their employees vacation.

Unfortunately, there are quite a few reasons why an unlimited vacation policy actually leads to more work.

The sad reality behind unlimited vacation days

On the face, unlimited vacation may sound reasonable.

After all, we’re all adults, so we shouldn’t have to ask to take a vacation when we know we need it just as we shouldn’t have to ask to use the bathroom when nature calls.

The problem with this, however, is that sometimes we need to be told what to do.

Obviously, no one is happy with zero vacation days, but when people are presented with “unlimited” they end up confused and uncertain on what the appropriate amount of days to take is.

And ambiguity isn’t the only problem with unlimited vacation days. Culture has a huge impact on how employers view their vacation policy.

Take the U.S. average. Working almost 500 more hours per year than French workers, America is also the only country that does not offer mandatory paid vacation days, paid sick days, and mandatory paid parental leave.

This pressure to work, work, work can make employees wary of taking advantage of the meager vacation days they are allotted (if any).

Combine these cultural norms with a fast-paced, hard-working office culture, and you have a recipe for disaster.

Unlimited vacation policies are huge in the startup world. Startups tend to be demanding, and time-consuming as there is a lot of work to be done. And such a hustle culture can make employees feel guilty about taking time off.

They don’t want to show their coworkers or employers that they can’t handle the workload, and they may also feel bad about leaving when there is so much to do.

Between busy workplaces, unhealthy workaholic attitudes, and the uncertainty of an open vacation policy, it is no wonder that millions of vacation days go unused yearly.

Plan ahead — how to create a successful vacation policy

The freeness of an open-ended vacation policy quickly falls apart upon closer inspection. But the limited, 10 days a year isn’t ideal either.

A successful vacation policy might fall somewhere right in the middle.

At JotForm, there is always a lot of work to be done. And, in order for that work to be done successfully, I know myself and my employees need time off to stay refreshed.

While we’ve yet to build a daydreaming room at JotForm, we do believe in giving our employees paid time off. We put some healthy pressure on our staff to actually use their vacation days, too. Vacations are a must for everyone at JotForm. No exceptions.

We also encourage people to work with their peak hours. Our flex time policy allows everyone to come in early or start later.

As long as they spend most of the day with their team, tackling projects and building momentum together, they can honor their own rhythms.

Take another example, Buffer, a social media startup that has had great success with their vacation policy.

When they originally ran into issues with the “no policy” policy, they knew something had to change.

They decided to keep the “unlimited” idea, but with a new rule. They added a minimum amount of vacation days — 3 weeks per year. That solved the issue of ambiguity and uncertainty with how many days were allowed.

And they even started offering employees $1,000 to take a vacation, which showed appreciation and changed the company culture in a positive way.

When employees feel appreciated by their employers, they will have more loyalty to the company and find more joy in the work they are doing. One of the best ways to show appreciation to your employers is through adequate time off.

Studies show that if employees took just one more vacation day a year, the result would be an extra $73 billion in output to the US economy.

When employees at Buffer saw their managers taking vacations, were offered bonuses for vacationing, and had a general number to go off when wondering how many days were appropriate, they felt at ease in taking a vacation when they needed.

Company culture

Every business is different. That’s both an opportunity and a challenge.

After 12 years of growth and change (and a whole lot of mistakes), I’ve learned that culture needs to be intentional.

Like any relationship, it has to be nurtured. It will change and evolve, so it helps to stay open. Be flexible. But also, understand what matters most deeply. Don’t compromise anything that’s truly essential to your business or your values.

Culture matters. I’ve learned that if you appreciate your employees and the work they do, the better they will work and the happier they will be in the office.

Vacation time and its myriad of health benefits is a massively important issue and something that, when done right, will build trust between you and your employees.

All of us feel like we need a week-long Caribbean dream vacation here and there; having the possibility to take that dream vacation without fear of backlash from employers and fellow employees is one of the greatest things you can offer your employees.

They will thank you with the quality work they deliver.

Aytekin Tank is the Founder and CEO of JotForm. A developer by trade but a storyteller by heart, he writes about his journey as an entrepreneur and shares advice for other startups. He loves to hear from JotForm users. You can reach Aytekin from AytekinTank@JotForm.com

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