The sheer mention of the word unlimited vacation splashes words like rooftop Jacuzzi with views of Montreal, holistic massages in the airy-cabins of Woodstock or long bike rides along the sandy-dunes of Nantucket! Sweet mother of pearls, we’ve already sold our souls to companies who’ve transitioned from giving two unused paid vacation days per year to unlimited vacation days! It all started when the flamboyant British entrepreneur, Richard Branson, got inspired by Netflix’s success at implementing unlimited vacation days and adopted the unlimited vacation policy. Similar policies have worked well with companies like Best Buy, Evernote, Zynga, VMware, HubSpot, and Groupon. Unlimited holidays may sit like a fluffy cloud of prettiness on your HR policy and may even look like less of an administrative headache. The question is can your company’s culture stand against the perils of such liberal policies? According to a 2014 survey by the Society of Human Resource Management, less than 1 percent companies offer unlimited vacation days. The unlimited vacation policy may sound great in theory, but is it really a wonderful idea? Below are a few reasons that speak otherwise: According to Lotte Bailyn, a retired professor at the MIT Sloan School of Management, there is a greater chance of employees taking vacation if there are limits chained to it. Excessive choice can be both restrictive and confusing, which is termed as “choice overload”. In a research conducted by the Columbia Business School, it was found out that employees with too many mutual fund choices were overwhelmed leading to paralysis. Employees were unable to make a call to the point that they either made a low yielding investment choice or none at all. The unlimited holidays policy is an ingenious way to exploit employees’ psychology. It is the double edged sword that will help them sense that they need to be responsible and get their work done and meet the deadlines. Most individuals won’t be able to take advantage of it, since being stuck on the “what is the right amount of holidays take that will make them fall back in work” train will overwhelm to a point of them taking very less holidays or none at all. Besides, the idea here is to reward employees to make them more productive. If they love what they do, do you think they’re going to take a month off? Most bosses need their employees on site attending their duties. Also, in startups where it’s quite normal to for employees to work 10-12hours a day, unlimited vacation policy is the selling point. An unlimited vacation here is not an option for them!
Diana Coker is a staff writer at The HR Digest, based in New York. She also reports for brands like Technowize. Diana covers HR news, corporate culture, employee benefits, compensation, and leadership. She loves writing HR success stories of individuals who inspire the world. She’s keen on political science and entertains her readers by covering usual workplace tactics.
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