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How to Provide a Meaningful Unlimited PTO Policy

By Erika Miller
Illustration of Carl the yeti laying in a hammock on vacation, taking paid time off.

We are thrilled to partner with Authority Hacker, which helps small to medium businesses grow their online presence. With a core team of just 8 people, they’ve grown to become a 7-figure company through and efficient, employee-first mindset!

Your team works hard for you. They spend most of their workday in the trenches, working hard, and getting stuff done.

They deserve to play hard as well.

Vacation time is a benefit that top talent will look for when scouting potential employers. Offering up unlimited paid time off is one way to make their eyebrows raise. But how can you accomplish this goal without abuse?

Well, keep reading! Today's post is all about how to provide a meaningful unlimited PTO policy that will make your employees and leadership happy.

Define What Unlimited Vacation Days Means for Your Company

According to the U.S. Bureau of Labor Statistics, the average amount of vacation time is around ten days.

Chart detailing percentage of private industry workers with number of annual paid vacation days by service requirement, March 2021.

So at first glance, unlimited PTO may seem like a dream come true. However, there are a few things to consider before implementing this policy at your company!

First, it's essential to define what unlimited vacation days actually mean.

For some companies, it may signify that employees don't need to track their time off. Others might limit the number of days that can be taken in a year. Regardless of the details, it's important to be clear about what the policy entails. Otherwise, you risk confusing and frustrating your employees.

Secondly, you'll need to consider how to handle vacation requests. If everyone is taking advantage of the policy and requesting time off at the same time, it could become challenging to manage. To prevent this, it's crucial to have a system for managing vacation requests.

Finally, you'll need to consider how unlimited vacation days will impact your bottom line. If too many employees are taking extended vacations, it could cost the company money. It’s important when considering and creating an unlimited PTO policy to find balance!

Overall, unlimited vacation days can be a great perk for employees. However, it's important to consider all the implications before implementing such a policy.

Set Some Ground Rules to Prevent Abuse

In today's workplaces, more and more companies are offering flexible PTO policies as a way to attract and retain employees. It’s a great benefit but it can also lead to abuse if not properly managed.

That's why setting ground rules regarding unlimited vacation days matters. First and foremost, employees should be clear on what is expected of them in terms of their work commitments.

If you’re worried about productivity and visibility into what’s being done, project management software like Asana and Clickup can help you track remote workers. There are plenty of online tools available to keep an eye on your team’s productivity pipeline!

Aside from that, it's crucial to establish a policy for how vacation days must be requested and approved.

For example, at Motivosity, the Marketing team shares a PTO calendar to 1. Put in PTO requests and 2. Get a quick glance at who will be in the office and when. Our system is flexible and easy to use, but also provides the structure we need to make sure there isn’t any PTO abuse.

By setting ground rules and expectations, you can ensure that your company gets the most out of its unlimited vacation policy.

Encourage Your Employees to Take Time Off

image with text - Taking regular breaks will actually make them more productive and better able to handle work-related stress!

As an employer, you likely want your employees to take advantage of their paid time off (PTO) so they can return to work refreshed and ready to be productive. However, employees may also be hesitant to use their PTO or don't know how to take time off effectively.

Here are a few tips on how to train your employees on how to take advantage of their PTO:

  1. Encourage employees to plan ahead. Let them know it’s okay to take vacation and help them be intentional in finding time to step away from work. This will help them make the most of their time off and ensure that they don't wait to take some vacation days and maybe even experience burn-out as a result.

  2. Help employees understand the benefits of taking time off. Many employees feel guilty about taking time off, or they think they must be available at all times in case something comes up at work. Help them understand that taking regular breaks will actually make them more productive and better able to handle work-related stress!

Following these tips can help your employees make the most of their unlimited vacation days!

Have Standard Operating Procedures in Place

A standard operating procedure, or SOP, is a set of step-by-step instructions for carrying out a task. They help ensure consistency and quality control.

Graph detailing step-by-step instructions for a standard operating prodecure.

When creating an SOP, be as specific as possible, so there is no room for interpretation. Once an SOP has been completed, it is essential to follow it religiously. This can be difficult sometimes, but it is necessary to ensure quality and prevent mistakes.

When used correctly, standard operating procedures can be an invaluable tool for ensuring quality control and improving efficiency.

But what does any of this have to do with unlimited vacation days? Well, someone needs to do the work while employees are taking time off. While we’ll get into this a bit more in the next section, it’s important to note that creating SOPs can be a big deal, so make sure they’re top quality.

Cross-Train Effectively

Cross-training employees should be part of any business operation, no matter what. By definition, cross-training is the process of teaching employees how to perform multiple tasks or functions within the workplace.

It can help increase efficiency by reducing the need for supervision and providing employees with the ability to work independently.

In addition, cross-trained employees are often better equipped to handle unexpected situations during their workday.

It can also improve employee morale by increasing job satisfaction and feelings of competence and empowerment. Finally, cross-training can help to reduce turnover by making jobs more interesting and multi-faceted!

There are many advantages to cross-training employees. By training employees in multiple tasks or functions, businesses can reap the benefits of increased efficiency, improved morale, and reduced turnover.

Using this strategy and having great SOPs in place will give you substitutes and team members an easier time picking up the slack. These employees will appreciate the effort, even more, when it’s time for them to take their vacation.

Make Sure Employees Know When They Can't Use Vacation Time

Employees need vacation time to relax and recharge, but sometimes there are periods when they simply can't be away from work. Make expectations ahead of time to let employees know when you need them available.

If you have an upcoming event or project requiring all hands on deck, let your employees know ahead of time so they can plan accordingly. This way, they won't be disappointed when they can't take their usual summer vacation at the same time.

Instead, they'll be prepared and able to focus on the task at hand. Of course, you should also try to provide some flexibility where possible.

If an employee has already booked time off that coincides with the period you need everyone to be available, see if there's a way to accommodate their request. In the end, clear communication and a bit of flexibility will go a long way towards keeping your employees happy and productive.

The End?

Offering five days of vacation is a thing of the past. That’s not a perk or a benefit. Frankly, it’s closer to an insult!

Give your employees a proper reward for working hard and making your company profitable. Having unlimited vacation time and focusing on work-life balance are just two of many ways you you can do that.

Thanks for hanging out with us today. If you enjoyed this post, you might like this one on tips for improving staff turnover rates.