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Unlimited vacation: Changing corporate culture

January 05, 2015

Richard Branson, founder and CEO of the Virgin Group, surprised the business world by announcing his company will no longer be tracking vacation days. I’ll let that sink in for a minute. Virgin Group is just one of a handful of companies like Netflix and Best Buy adopting this trendy new policy. In doing so, they seem to want to mimic many Silicon Valley companies’ perk-driven workplaces (Google is famous for this policy and other unusual perks). Some companies are even taking it one step further and promoting taking vacations. FullContact, a software firm based in Denver, gives employees the option to receive $7,500 to put toward a vacation of their choice with one catch: they are not allowed to check their email while away. If this trend catches on across the business landscape, how can employers and their employees implement these kinds of changes and maintain productive business?

While unlimited vacation policies may seem too good to be true, remember there are two sides to every coin. On the heads side, it seems like you get to take a vacation whenever you want; you no longer have to go through the agonizing task of planning out vacation days in January then anxiously doing the math to make sure you can afford to take time off when something unexpected comes up. So what can be so bad about unlimited vacation? With that freedom comes responsibility: You need to ensure your work and colleagues don’t suffer while you’re away. Not to mention, you may end up picking up the slack when your less responsible colleague departs on a last-minute cruise to the Bahamas. Companies are banking on the fact their employees will only take extended vacations when their workload permits. Those who abusing this policy will likely be rewarded with a nice string of unpaid days off. 

While many companies have reaped the benefits of unlimited vacation policies, simply implementing them may involve a major culture shift. According to Roger Dow, president and CEO of the U.S. Travel Association, “67 percent of employees report that their bosses don’t encourage taking vacations or give mixed messages about taking time off.” If employees don’t feel comfortable asking for time off, what’s the point of unlimited vacation? A new policy like this goes deeper than adding a page to the employee handbook (or a few less pages). It requires a change in mindset and organizational culture. The “do more with less” model companies adopted during the recession is slowly but surely going the way of the dodo bird, and firms are using perks like unlimited vacation and nap pods to attract and retain top talent. Mainly companies in Silicon Valley, which are rich with millenials, are the ones adopting this forward-thinking workplace atmosphere. Changing the minds of older generations used to explicit vacation policies—and perhaps more of a clock-punching mentality—could prove more difficult.

So how can employers put an unlimited vacation policy into place and make sure employees are both comfortable using the benefit and likely to use it maturely? As a manager you may have to set the example. One way to do this is taking time off for yourself. Especially if you’re a midlevel manager, showing your team the right way to take a vacation, e.g., being transparent about your workload and preparing your team for your absence, will help the people around you feel comfortable in using the flexible time.

Requiring staff to take vacations is another way to help shift their mindset. You probably have a team member who is as reliable as the day is long; he or she is your workhorse, in the office every day rain or shine and churning out quality work. If your star players are the sort who wouldn't take days off unless they were on their death bed (even then they would be checking emails), they may be headed for real burnout. Requiring your best employees to take vacation time shows the rest of the team that it’s OK to leave the office and enjoy their time off. It also shows them you are buying into the concept of a happy workforce, trusting them to produce quality work, and showing them you genuinely care. Very few people say they do their best work when they are overworked, tired and stressed. Rested employees are productive employees.

Certainly, adopting on unlimited vacation policy does not make sense for every company; for instance, retail and public services require full, consistent staffing. But as this type of work environment continues to gain popularity, it is important to remember that not all that glitters is gold. Changes that impact entire organizations require more than a simple flip of a switch. Being mindful of the movement below the surface will help things go more smoothly and enable firms to get the most out of their employees.

As a market research analyst, Jimmy Dyches spends his day collecting data on all things tech-related—and gaining valuable insight into current IT services and staffing trends.

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