The phrase, “unlimited PTO,” is probably accompanied by an exciting feeling in your belly and a smile ear-to-ear. Now you can go on both family vacations, attend your friend’s bachelorette week in Nashville, and still have extra time to extend your holiday breaks with no remorse, right? Not exactly. Some things sound too good to be true for a reason, and if you have to ask, “What’s the catch?” there’s probably a good reason why. In this blog, we will uncover some of the “cons” to consider as both an employee and an employer when talking about unlimited PTO.
On the employees’ side, because there is no contractually mandated number of days available, many employees end up taking less than the standard two weeks due to feeling uncomfortable declaring their work is done and their schedule is free. We can vouch for this as many of our candidates who have received this benefit have verbally stated their aversion. Many of us feel guilty about using our paid time off even WITH a limit as to how much we can use, so why would making it “unlimited” be any different? Chances are if you get those butterflies in your stomach when it comes time to submit that paid time off request to your boss for your Disney vacation in July, it’s because you feel an obligation to put your job before your own self and that feeling is not something that can be talked out of you. We tend to forget that the paid time off we are offered is a BENEFIT that we receive for the hours and work we put into the company, and we should not feel guilty for using it, but that guilt will likely never change.
Some people would argue this feeling of guilt, but at the end of the day, everybody is different. Each employee has different wants and needs and while some may feel remorseful about using this perk of unlimited PTO, others may have no issue scheduling all the vacations their hearts desire knowing their work will still get done. The big question is, what might you be losing so that you can gain this added benefit? Maybe your employer will offer a lesser salary as they assume you will take full advantage of this added benefit, or maybe they will cut back on the flexibility of hybrid/remote work. A good relationship consists of equal give and take so you will have to determine what you are willing to give.
Unlimited PTO can pose a downside for both employees and employers. As an employer, before implementing such a benefit, you must weigh the pros and cons. On the positive side, it is likely a benefit that is unique to your company as XpertHR’s 2021 paid leave survey showed that of 600+ companies asked, only 4% of companies offered unlimited PTO. We don’t need to tell you how important it is to help yourself stand out amongst competitors in a time like this. However, have you considered how this might alter the perception of time off as a benefit? Yes, ultimately unlimited paid time off should not be lessened to anything besides a blessing, but it is likely that your more seasoned employees, who accumulated additional vacation days as an added benefit of their loyalty and years worked, may feel slighted now that they are receiving the same benefit as your entry-level new hire. Understandably, they may ask what benefit you will now offer as a token of appreciation for their time put into your company, or if you view all your employees the same.
On top of this, as an employer, you must consider the size of your company and the overlap of vacations your employees will take. If you are a smaller company, you likely have a rule in effect that will only allow one or two employees to be out on vacation at the same time. With the offer of unlimited paid time off, you lose that “control” of when your employees can use their paid time off, and before you know if your entire finance team could be on vacation at once. Something to seriously consider when you have a business to run.
If you are looking for a career change with additional benefits, please give us a call at (518) 275-4816 as we are happy to help find your perfect fit!
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