Unlimited PTO Can Bring Productivity Improvements to Your Business
There are many studies that have been done that have shown the value of giving your employees time off away from the office to relax and recover from the daily grind. Having a day off for a mental break or a vacation that keeps a person away from work for a week or two are well documented to provide a chance to recharge your battery and re-energize their enthusiasm. That helps productivity and allows employees to be more creative and productive in their jobs.
In most traditional work settings, employee time off was separated into a certain number of officially labeled days that were allowed, sick days, personal days and vacation days that were paid. Now it has become much more common to offer a block of PTO that is usable whenever the employee sees fit. A newer idea is unlimited PTO which has gained favor in the tech industry.
How Unlimited PTO Policies Work
It is a simple idea in concept, the employee can take as many mental health, vacation or sick days that they want. There are no limits, the only requirement is that they are meeting all of their performance goals. It is not a total free for all, though. The employee has to follow procedures to request time off. Other than sick days and emergencies, PTO needs to be requested and approved by management, just like with traditional PTO. That way there is a constant evaluation of the production of an employee.
Results Only Workplace Environment (ROWE)
The results of a policy like this can become the ROWE which gives employees complete freedom to be at work or not as they see fit. They are able to weigh the balance needed for their life between their work responsibilities and their free time. ROWE workplaces provide a lot of freedom to determine when and where you are going to work. This can be a very enticing feature for potential employees and make for a very creative and healthy workplace.
What Unlimited Means
There have been studies completed that clearly show, when PTO is offered in unlimited qualities, employees take just about the same amount as they would in the traditional system of limited and labeled PTO. There are many cases where the employer has to encourage employees to take more time off. Some may be too afraid to take “too many” days off. Or they might just be so into their job that they do not want to be away from the office for an extended period of time. Some highly motivated people will feel guilty if they miss too much work as if they are shirking their responsibility. Unlimited PTO should allow for a person to take as many days as they feel that they need in order to be healthy in their personal life and productive at the job.
The Positive and Negative of Unlimited PTO
Like all policies in the workplace, there are going to be assets and liabilities that result from instituting a policy. That is no different with unlimited PTO, and all of the possible results should be considered before a policy is enacted.
Positives of PTO
-There is a feeling of trust that is fostered between employee and employer when the responsibility of time off relies solely on the employee’s discretion.
-This fosters a work environment that is built on personal responsibility and a feeling of being valued.
-PTO is obviously going to be an attractive feature when recruiting the best new talent into your business.
– With unlimited PTO there is little chance a person is going to come to work ill and make the entire office sick.
-Depending on state law, the days of unlimited PTO do not have to be paid out when the employee leave your company.
-Much administrative time is saved in tracking time off and pay that has accrued over time when an employee leaves a place of employment.
Negatives of PTO
-It can be difficult to terminate and employee if they make the choice to abuse the policy. They are technically allowed to take the time off. The key here is to have performance goals and standards that are clearly understood and measurable. If these are not being met, that should be the issue anyway.
-Records still need to be kept in order to make sure that all state and federal labor laws are being followed and to monitor general behavior for abuses.
Choose a Policy that Works For Your Business
Not every company is going to be a good fit for unlimited PTO. If a company works well on a goal-oriented work system, then unlimited PTO makes sense. These organizations track production and performance well and that keeps the company successful. Abuse can be reduced by creating a process that requires approval for administration for most days off.
Unlimited PTO is a system that provides a different option for companies to use to foster a certain atmosphere in the workplace. It may not work for all employers in all industries. It does work well in some industries. The secret to a positive policy is that the policy needs to be written down and explained completely and in detail. When it is implemented all parties need to understand their rights and responsibilities. If you feel that your company can benefit from more trust between leadership and employees and they can see the value both mentally and health wise of treating individuals as if they are valued then the unlimited PTO option may be right for you.
Credit for this small business article goes to NECHES FCU, Port Neches, TX.
Neches FCU is a Texas credit union and has an awesome team of professionals ready to service all members. When the doors open at any of the 9 service outlets, the mission of “Ultimate Member Satisfaction” becomes the driving force for every employee. They are known for a personal, dynamic and fast-paced work atmosphere, delivering a memorable service experience, and where all members are known by their name.
Neches Federal Credit Union has approx. $438 Million in assets with over 45,000 members. Neches is recognized by members and the business community as one of the top credit unions in texas and an actively involved partner, helping our Family, Friends and Community!
