🧳 Is unlimited leave truly without limits?

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🥪 No free lunch?

Unlimited leave can’t truly mean no limits…right? Bingo! While such a policy implies that an employee can take any number of leave days, it is usually not a reflection of reality.  

Often, there is a herd mentality where employees tend to stick to the number of leave days that their colleagues take. There is also the feeling of guilt when they take more than others, which holds them back from fully utilising this perk. In some cases, staff may fear taking “too much” PTO, as they are concerned that it could be used against them during performance reviews or even make them more vulnerable to layoffs. 

“Without a fixed number of leave days, there is no longer an existing benchmark for what is appropriate in the organisation,” says Finian Toh, managing director at HR executive search firm ChapmanCG. 

How, then, would one know if he or she is taking “too much” leave? It is difficult to give an answer to employees under an unlimited leave policy.  

A global study by US-based HR platform Namely in 2017 found that people took fewer days off under an unlimited leave policy (13 as opposed to 15 per year), compared with those who received a fixed number of leave days annually. With this in mind, could an unlimited leave policy be more restrictive rather than liberating for employees?

Here are some other problems 🙁 that could arise with an unlimited leave policy: 

• Bad managers will still find a way to manipulate the policy, either by guilt-tripping employees, dangling the possibility of layoffs, or convincing staff to postpone their leave since there is no limit anyway
• Overlapping leave in the team – particularly during school holidays or year-end festive periods – may result in remaining employees working without adequate resources to meet deadlines. 
• Employers might get the short end of the stick if employees are irresponsible. Some might abuse the system by taking leave to avoid tight deadlines or crunch time. If absenteeism becomes an issue, an employee may burden other team members and lower overall productivity at the company.
• Most of the time, unlimited leave cannot be encashed once an employee resigns.

That said, the flexibility of such an arrangement has its benefits when managed well, such as improved mental well-being, which can lead to higher employee retention levels. 

ChapmanCG’s Toh says that policies such as unlimited leave empower employees and give them a greater sense of ownership over their work. This brings about positive outcomes such as higher levels of job satisfaction, engagement and productivity, he adds.

Clarence Koh, 27, is one of those who has such a benefit. He works remotely for a US-based company that offers unlimited leave. While he appreciates having such flexibility, he acknowledges that it comes at a cost.

“I do realise that I tend to take less leave (than before) under this system,” Koh says.

🤝 Company culture-dependent

At the heart of it all, Toh believes that company culture plays a crucial role in determining whether an unlimited leave policy plays out well. 

“Unlimited leave will only be effective if the organisational culture allows employees to take a reasonable amount of time off,” says Toh. He adds that it is important for bosses and line managers to lead by example by taking time off themselves. They should also not expect or encourage employees to be on “standby” even on their leave days. 

“When managers do not lead by example or are demanding workaholics, team members will very likely feel discouraged from taking leave,” he notes.

If you are considering a job with an unlimited leave policy, here are some things you could do to make it work for you:

• Have a conversation with HR on explicit expectations about leave-taking. ❗ This is crucial, to set expectations from the start. 
• Check on policies that may include restrictions on the maximum number of days employees can take at any one time. 
• Communicate with your manager on how to best manage work demands while organising your leave schedule, so that no deadlines fail to be met. 
• Find out how performance will be evaluated to ensure that you know what is expected of you when it comes to your performance review. 

It’s important to bear in mind that unlimited leave is, in essence, a policy built on mutual trust – it is not a silver bullet to fix burnout and low motivation levels. Yet, unlimited leave should not be seen as a standalone employee benefit at an organisation. 

“Fundamentally, the success of unlimited leave in an organisation is very much dependent on all other benefits that surround the policy,” Toh says. “Ultimately, if employees are unable to benefit from unlimited leave, then it’s not actually an employee benefit after all.”

TL;DR

• Unlimited leave can be great for mental health and workplace flexibility
• …however, guilt-tripping or toxic mindsets might result in employees feeling bad to take leave  
• Expectations need to be clearly defined to ensure that managers and employees are on the same page when it comes to taking leave, as well as how performance is to be measured ☹️
• Good company culture is needed for unlimited leave to benefit both employees and employers