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Posted: August 05, 2013

A look at unlimited time off

Balancing culture, judgment and results

Dan King

Over the past year, some Colorado companies have been discussing the option of providing employees unlimited time off.  The concept fascinates me, because it can work really well, fail miserably or make no difference.  It really comes down to company culture, individual judgment and accountability for results. 

If you have the right company recipe for success, there is a high likelihood an unlimited time off policy might work.  If not, it can be a poison pill for culture that breeds inequity and entitlement.  So, what are the basic rules of engagement when considering an unlimited PTO (“Paid Time Off”)?  Let’s address a few key thoughts on how to think about this type of benefit:

Work smarter – not longer – I have yet to see a reasonable study performed that has definitively linked “office face time” to productivity.  Rather, it comes down to making sure your team has the appropriate “internally driven talent”, or the fire in the belly, including an open culture to drive performance.  Go here for more on the topic of talent.

Lead your team by empowering them – Easier said than done.  Be the servant leader and provide your team empowerment and the opportunity to succeed.  Manage to outcomes, not people.  This means you give up control, while still maintaining it through your extended network.  Go here for more on servant leadership.

Make sure everyone’s needs are met – The concept of unlimited time off has to work for both the company and the employee.  There must be a mutual understanding that we’re all adults and hold ourselves accountable to a higher standard.  This includes making sure the culture allows for employees to assert and achieve their needs too.  The rules of engagement in today’s talent market have changed.  This requires keen individual judgment and discipline.  Go here for more the employee engagement model.

Results driven culture – While unlimited time off sounds appealing, the reality is the entire company must balance this concept with results.  It isn’t practical to take 40 weeks off a year and still get your work done.  But, it is practical to take more time off than you do today and still be available and engaged with work.  This may also increase the importance of acknowledging the need for a “digital sabbatical”.  Go here for more on the digital sabbatical topic.

Implementation of this an unlimited time off policy is not without its potential human resources and employment compliance issues.  Before declaring this policy official, run it by your Finance and Human Resources team first so you are thoroughly prepared and within compliance of labor laws.  If used and implemented properly, the unlimited time off policy is a fantastic recruiting and retention tool and great instrument to build a second-to-none company culture where everyone succeeds.

Dan King is a financial operations leader with significant experience in venture capital and private equity-backed technology companies in software, SaaS, Cloud and ecommerce business models. He began his career as a CPA with KPMG in the Silicon Valley and is active throughout the Colorado technology and small business community.  Dan can be reached at djk235@hotmail.com

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Readers Respond

We have maintained an unlimited personal leave policy for 13 years. As CEO, I do not miss the days of babysitting, budgeting to the hour, and dealing with politics of leave policy. Simply said: we have no leave policy. I tell my teammates worldwide that if they can accomplish their job in 3 hours per week, good for them! It's the job (and their client) that matters. And generally speaking, when you treat people like adults, they respond in kind. By Miguel on 2013 08 13
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