Don’t Be Scared — and Don’t Be Hasty: How to Nail Your Unlimited PTO Policy

For some workers, unlimited paid time off (PTO) is a reality — and most of those employees who don’t have it yet want it. In fact, a recent MetLife study  shows that 72 percent workers are interested in unlimited PTO.

Yes, “unlimited” here really does mean “without a limit” — “infinite,” if you wish. Slowly but surely, more and more HR managers are converting to the unlimited PTO religion, hoping to increase both employee happiness and productivity by doing so. Maybe you’re one of them. Maybe you’re actively considering an unlimited PTO policy to keep up with the trends and compete with all the hype startups out there.

But are you sure this policy is a good fit for your company?

In every company, there’s a Jane. Jane won’t take her full PTO. Jane gets sick often, though, and you are very aware that she needs to take time off to be more productive. Would an unlimited PTO policy nudge employees like Jane to make use of their PTO, or would it make their habits worse?

Before you start thinking about PTO implementation, you need to get to know your employees! You can only begin planning your unlimited PTO policy if you first understand how your employees currently use the PTO they already have.

Don’t forget to think about the pros and cons, and be sure to evaluate how unlimited PTO would potentially impact your company operations. Unlimited PTO is trendy, sure, but you don’t necessarily need to adopt this fashion — and if you decide to go for it, you need a thoughtful plan.

Understand What Your Employees Do With Their Time Off

Time off work is the time we spend with our families and friends, time to relax and recuperate, time to unwind and recharge. It’s the hallowed “life” in the “work/life balance” that so many of us crave. PTO isn’t to be feared or scoffed at — it’s something your team will love you for. Think of the motivation and productivity of a happy and well-rested workforce.

And then there’s health. We all get sick, but PTO is different from sick leave. People need to take care of themselves, and that requires doing more than just visiting the doctor when the symptoms become too much to bear. Don’t just think about physical health: Employees need to take care of their mental health, too. Unfortunately, that’s a topic it is still hard to talk about in many work environments.

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And family reasons! We’ve all had sick family members or family members who need special attention for some other reason. Like any human being, your employees not only need to take care of their families — they want to. Maternity and paternity leave are the most common family-related PTO needs, but there are plenty of other situations your employees may need PTO for, too. What if someone’s mother gets sick? Paying for home healthcare might not be feasible — and even if it is, your employee may still be too distracted to work.

In short, employees spend their PTO on a variety of things. You need to understand what your employees are using their PTO for, and then you can use that information to shape your policy going forward.

Implementing Unlimited PTO With Eyes Wide Open

So you know what your employees use their PTO for, and you’ve decided to implement unlimited PTO. The first step is setting expectations correctly.

When PTO is limited, studies  show that less than half of Americans (47 percent) use their full allotments of time off. What’s the point of increasing your policy if employees aren’t going to make use of the benefit when they need it?

And if you switch to unlimited PTO, your team might end up taking even less time off for fear of crossing the line. In an unlimited PTO system, people may not know how much PTO is normal and acceptable. As a consequence, they take fewer days off.

To get around these problems, you’ll need to provide guidance. Start by setting a bare minimum expectation of how many days an employee should take every year or each quarter. Also, think about prescribing time off rather than waiting for a request to arrive on your desk. The moral of the story is, you’ll need to keep an eye out — not for those who are taking too much time off, but for who those who are not taking enough.

Be transparent. Bring visibility to how much time off people take and when they take it. Let people see each other’s PTO calendars. Your company needs to be able to plan for those absences and make sure everyone’s PTO is covered smoothly. Such visibility will also help your team members plan around each other better, and it will help to set expectations around how much PTO to take when you have an unlimited policy.

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Every day, a good HR manager wakes up thinking about how to keep their employees happy and motivated. While unlimited PTO is one solution — and a particularly trendy one at that — it can be challenging to implement. Indeed, it can even backfire.

Don’t be scared of unlimited PTO, but don’t rush into it either. The objective is to devise a policy that works for both the company and the employees. Take your time, speak to your team, and once you launch unlimited PTO, keep a close eye on how people use it (or don’t).

Gary Bury  is founder and CEO of Timetastic.