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What could be bad about unlimited vacation time?

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More flip-flops may be needed if your company offers unlimited vacation time.
More flip-flops may be needed if your company offers unlimited vacation time.(Shutterstock)

Unlimited vacation days.

What could possibly be the downside? Even in typing the words, I've begun to imagine cycling the hills of Tuscany, snowboarding in Japan, and visiting friends in Santa Fe.

Most of us live in a world where vacation days are an extremely scarce resource — one that accumulates slowly with seniority. But at an increasing number of companies around Boston, vacation is like tap water. It's always there when you want it, or need it, with no one keeping track of how much you've used.

But there is a flip side to the fantasy. More on that in a second.

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Asking around, I found a number of tech companies — startups and more mature employers — that offer an unlimited or "open" vacation policy. They include home goods retailer Wayfair; marketing software provider HubSpot; the security and content delivery firm Akamai; Acquia, which makes software for running websites; and Kronos, which provides workforce management software.

Why? It's yet another creative way, beyond free lunch and a foosball table, for the companies to try to attract the best tech workers.

"The single biggest reason we did it is that we needed to change our recruiting profile," Kronos chief executive Aron Ain said. "And it's not just about millennials. It's people in their 30s and 40s who have families. They don't want to come to a new company and start their vacation balance over again with three weeks." Ain says there weren't that many other companies offering unlimited vacation locally when Kronos started studying it in 2015, so he saw it as a way to differentiate the Chelmsford-based company.

"It's definitely a trend," says Marcus Tgettis, vice president of global talent at digital services provider Endurance International Group of Burlington, which has an unlimited vacation policy. Tgettis says it began in Silicon Valley with Netflix, around 2004; Akamai, where Tgettis previously worked, was one of the earliest Boston employers to introduce it, in 2007.

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In part, Tgettis says, it's a way to "encourage employees who are generally working more hours — they're plugged in all the time — to take time off, break away, and decompress. We see it as important to productivity."

At Kronos, Ain says he realized that many people considered their saved-up vacation days as a kind of bonus they would receive whenever they decided to retire or go elsewhere. About $2.2 million a year in unused vacation was paid out annually, he says. "But why do you want to pay the people leaving the company? Instead, we decided to pay it to people staying with the company."

So without taking away anyone's accrued vacation balance, Ain decided to redirect about the same amount of money annually to increasing the company's 401(k) matching, creating a scholarship program for the children of employees, and helping employees repay college debt.

Still, there was grumbling. Some of it came from managers who had to suddenly be arbiters of what was an appropriate length of vacation, Ain says, versus what might leave their department in the lurch. (Is a month trekking the Himalayas OK, especially at the end of a quarter?) But also upset were some longtime employees who felt they'd earned their five or six weeks of vacation the old-fashioned way, "and thought it was unfair that someone new coming in gets the same amount as they get," Ain says.

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From the company's perspective, there's no more tracking how many vacation days each employee has used — and also no more paying out for unused days at the end of their tenure, as Massachusetts law otherwise requires, because, well, how many of your infinite vacation days didn't you take?

When I used Twitter to ask employees who work for companies with an unlimited policy what they liked most or least, I got a mix of responses. "The biggest plus is that I don't feel guilty taking time anymore," wrote Megan Wittenberger of Carbonite, a data backup company in Boston. Peter Zotto of the Boston startup Price Intelligently wrote that he takes less vacation time. "I would argue [the policy] can set up a culture of 'always on,' [and] folks are skittish about using [vacation days]."

Brendan Caffrey of the Cambridge e-mail delivery startup Litmus Software said his company "explicitly chose not to offer unlimited, because anecdotally, we heard bad things," like that it can create "a culture of discouraging/shaming those who take time off."

A poll I created that garnered 189 responses on Twitter (not scientific, obviously) found that while 49 percent of respondents say they take about the same amount of vacation, 21 percent say they take more vacation, and 30 percent take less than in a previous job where they had a fixed number of vacation days.

At HubSpot, there has never been a defined number of vacation days, and in the company's early years, "we'd see people working too hard," acknowledges Jim O'Neill, the company's chief people officer. It eventually became a task for the company's managers, who have weekly one-on-one meetings with the employees they supervise, to "pay attention to employees and their own personal wellness," encouraging them to take regular time off. While no one counts the number of vacation days people take, O'Neill says, they are evaluated on other metrics, such as sales targets or making progress on a software project.

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While the policy is most prevalent today among startups and tech companies, Heather Hartford, the chief people officer at Acquia, says she believes that we'll soon see bigger "established organizations rethinking their current approach as well," as a way to be more competitive at recruiting top people. Boston-based Acquia has about 800 employees.

The company's culture has a big effect on how comfortable — or uncomfortable — people feel going on vacation. Marie Burns is an organizational development consultant for startups in Boston. She says that of the eight startups with which she currently works, "none of them have defined vacation policies, and it works brilliantly for them." But she has also experienced startups where the workweek lasted 100 hours, and even with an unlimited vacation policy, the message was, "Don't take vacation."

"What I see with people in the market for a startup job now is they want to know, 'Is the unlimited vacation policy real or is it fake?' Because some companies have ruined it. They ask to speak to other employees, and go out for lunch, to figure out what the culture is like."

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Tgettis at Endurance says that when it comes to vacation days, "We want our employees to think like owners — to use their judgment and consider what's best for them and the company."

Unlimited vacation can be sweet — as long as you don't spend your days on the chaise longue obsessed about whether you're taking too much vacation.


Scott Kirsner can be reached at kirsner@pobox.com. Follow him on Twitter @ScottKirsner.