Wednesday, November 28, 2012

Unlimited Vacations: A low cost strategy to improve productivity

Over the last two decades or so, companies have started trusting their employees with more data, more privileges and more liberty. Some companies are taking it to the next level by not capping the number of vacations their employees can take in a year. Companies have discovered that Paid-Time-Off (PTO) which has always been an important part of an employee’s package can be used strategically without any apparent limit. Over a period of two years they have discovered that apart from a few abuses of the practice, it has largely been a very successful exercise.

A case in point is Red Frog Events which is a weekend entertainment organizer. It has allowed unlimited vacations for the past two years and hasn't seen a drop in productivity at all. While it is true that such a privilege can be put to practice in a small organization with a relative ease, as there are less calendars to coordinate; it still remains one of those rare benefits that can be used to compensate a marginally less offered salary or a low bonus. It is so rare that according to the Society for Human Resource Management's 2012 Employee Benefits Survey, only 1% employers offer it.

Another firm to implement such a policy is LRN, which is an advisory-services firm. The Chief Executive,  Dove Seidman concedes that he has seen his employees being more thoughtful of their responsibilities and considerate about others’ calendars ever since the firm implemented this rule, about three years ago.

As an employee, I would like my organization to trust me to not abuse such a policy and offer me the privilege of taking as many offs as possible. What is your take on this? Do you think this is sustainable?


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