The mass shift to remote and hybrid working that occurred during the pandemic, as well as the dire economic conditions facing businesses, have caused a myriad of novel changes to the world of work.
One major change is that businesses of all shapes and sizes are offering more perks and initiatives that benefit employees than ever, in an effort to both retain and attract the top talent in their respective sectors through flexible working conditions.
Microsoft became the latest big tech company to offer unlimited PTO (Paid Time Off) to salaried employees, who now have no enforceable limit on how much vacation time they can take.
But what other companies are offering unlimited PTO, how does unlimited PTO work, and is it something we’ll see more of in 2023?
In this article:
- What is Unlimited PTO?
- Companies with Unlimited PTO in 2023
- How Does Unlimited PTO Work?
- Unlimited PTO Statistics: What the Data Says
- Should My Company Adopt Unlimited PTO?
- Hidden Benefits of Unlimited PTO
- Creating an Unlimited PTO Policy
What is Unlimited PTO?
Unlimited PTO stands for unlimited Paid Time off. It’s also sometimes referred to as “discretionary time off”, “unlimited vacation” or “extended vacation”.
Although companies don’t always mean exactly the same thing when they use the term unlimited PTO, it generally refers to any vacation policy where there is no limit to the number of days an employee is allowed to take off during a given year.
Companies With Unlimited PTO in 2023
Microsoft is not the first company to offer unlimited PTO in the tech sector, with a number of other major corporations already offering endless vacations at employees’ discretion.
In fact, many of these companies have been offering it for years. One recent survey involving 200 large US media, tech, and finance businesses found that 20% were offering some form of unlimited PTO. We’ve put together a list of firms with unlimited PTO options, and detailed what their unlimited PTO policy actually entails.
As we’ve already mentioned, Microsoft recently announced plans to offer unlimited PTO to employees, from January 16th 2023. However, this is only be available to employees working within the United States, and it won’t be offered to those working hourly jobs with Microsoft anywhere in the world.
10 corporate holidays, sick days, and leaves of absence will remain, and employees with unused vacation balances will get a one-off payment in April.
Microsoft says that “modernizing its vacation policy to a more flexible model” was the next step in the company’s transformation.
However, Rob Whalen of PTO exchange told GeekWire that the move was financially motivated, and an attempt to remove the need to pay out unused vacation time when an employee departs the company.
Web conferencing app Zoom, which exploded in popularity during the pandemic, offers unlimited PTO for its employees.
Zoom calls its unlimited PTO “My-Time-Off” and describes it as an “extended vacation policy”. As well as this, employees will get 11 paid holidays a year as standard.
Zoom's version of unlimited PTO is only available for salaried employees, with Zoom’s hourly employees instead placed on what Zoom calls a “rich” PTO plan.
Zoom also offers remote roles covered by Zoom's My-Time-Off policy available.
Twitter has been offering unlimited PTO as a staff benefit for some time. Along with it, the company also offers 20 weeks of maternity and paternity leave, which is more than most US companies.
Whether it will stay in place throughout Elon Musk’s continually tumultuous reign at the helm of the social media network, however, is anyone's guess.
Streaming giant Netflix has offered unlimited PTO for some time now, which they call their “No Vacation Policy”. At Netflix, staff members decide when they want to work.
“We don’t have a prescribed 9-to-5 workday, so we don’t have prescribed time off policies for salaried employees, either” the media company explains on its jobs portal.
“We don’t set a holiday and vacation schedule, so you can observe what’s important to you—including when your mind and body need a break.”
Netflix CEO Reed Hastings advises in his 2020 book, No Rules Rules, that “if you want to remove your vacation policy, start by getting all leaders to take significant amounts of vacation and talk a lot about it”. This, he says, will make staff feel comfortable taking off the time that they need.
Microsoft-owned LinkedIn has been offering unlimited PTO for a long time prior to its parent company’s decision to do the same.
LinkedIn employees have been able to take discretionary time off since 2015, in line with their company values, which say employees should “act like an owner” while working for LinkedIn.
“With discretionary time off, there is no set minimum or maximum amount of vacation time employees can take in a year,” the then-Chief People Officer Pat Wadors, now CPO of UKG, which also offers unlimited PTO, explained in a post on the platform at the time.
Popular project management software provider Asana provides unlimited vacation time for staff. According to Comparably, 60% of Asana’s staff say unlimited PTO is the most important staff benefit that the company currently provides for them.
“The best thing is unlimited PTO, and the worst thing is that PTO is unlimited,” says one Asana employee on glassdoor.
However, the employee also highlights that “the downside of unlimited PTO is that there is no guidance on what is the ‘right' amount of days to take off.”
Hubspot offers unlimited PTO because, they say, “employees are treated like people, not line items.”
“Employees are whole people, with families, hobbies, and lives outside of work” Hubspot explains on its website. “We work remotely, keep non-traditional hours, and use unlimited vacation to create work-life “fit” for us and the people we love.”
Software company Oracle facilitates unlimited vacation time for salaried employees who can’t get overtime.
The only real stipulation is that it has to be signed off by a manager, so lots of staff aren’t heading off on their holidays while the company requires their services.
According to Comparably, however, only 25% of Oracle employees say it is their most important benefit, with 401K contributions ranking higher.
Sony Electronics offers all salaried employees unlimited paid time off, recognizing the value of employees being able to relax, unwind and recharge their batteries as and when they need to.
One employee confirms on Glassdoor that Sony offers “unlimited vacation for salaried employees with the manager's approval”, and commented that “many people take personal vacations a few times a year.”
Roku’s Comparably profile details that employees cite unlimited vacation as the second best perk currently offered at the company for workers.
“For salaried employees, we don’t track vacation” Roku confirms on its website. “Instead, you can take what you think is appropriate, as long as you get your job done and don’t impact the team’s work.”
Remote helps companies manage remote employees anywhere in the world, so as you'd expect, the company has a pretty solid work from home policy.
However, as if that wasn't enough to entice you to send in your CV, it also offers its staff unlimited PTO. There's some caveats – leave must be signed off by a manager, and employees may be restricted by when they can be off if colleagues are absent at the same time, but these considerations are fairly standard.
Skillshare is an online learning community for creators that hosts online classes and lessons.
A forward-thinking company, Skillshare not only offers employees unlimited vacation every year but also enforces a minimum amount of time off that employees must take.
On top of this, Skillshare also offers paid sabbaticals for tenured employees, and even a monthly coffee and tea reimbursement of up to $25.
Online video platform Vimeo offers its staff unlimited PTO, as well as the option to work in the office or at home (or a mix, if you'd rather).
Not only that, but Vimeo also closes its offices at 1pm the day before a national holiday. It also has a generous parental leave policy.
Cloud computing company VMWare has a “non-accrual policy” for holidays that covers salaried employees based in the US.
“You may take time off from work when you and your manager agree, based on business needs” the company's unlimited PTO Policy reads.
“You should discuss your time off in advance with your manager so that business coverage is in place while you are out of the office” the company adds.
According to a number of online sources, the cryptocurrency trading platform Coinbase offers unlimited vacation time.
However, on the anonymous professional network Blind, one former Coinbase employee details his negative unlimited PTO experience he had with Coinbase.
“During my 18 months[sic] of employment, I didn’t take a single day off. I couldn’t, because the workload was insane and I knew people who were PIP’ed for taking time off” they explain.
“So I never did it. The layoffs came and it came with a funny surprise! Because the company has unlimited PTO as a policy, you don’t get to be paid for the time off you didn’t use.”
Other companies offering unlimited PTO
There are actually a whole lot more companies offering unlimited PTO. Some of the most well-known businesses offering unlimited vacation include:
- Salesforce (CRM and marketing software)
- Goldman Sachs (Banking & finance)
- UKG (HR, payroll and workforce management)
- Stacker (data-driven news reporting)
- Veritone (enterprise AI solutions)
- Evernote (note-storing app)
- General Electric (various electrical goods & services)
How Does Unlimited PTO Work?
In theory, unlimited PTO means employees could take weeks – or even months – off work at one time. However, unlimited PTO policies operate on the basis that trusted, valued and capable employees won’t abuse the policy in this way.
“To date, it’s been an overwhelming success. Productivity has actually gone up and employee morale is at an all-time high,” explains Thomas Hawkins, CEO of Electrician Apprentice HQ. However, he warned that “oversight is needed” to avoid “negative outcomes”.
In most instances where unlimited PTO is offered, staff will still request the time off via their manager. Few companies operate an off-the-cuff time-off free-for-all.
It’s definitely advised to have some supplementary PTO guidelines around how you book time off, and these can be created on a company-wide or team-by-team basis. For instance, allowing employees to book any time off they want, so long as they do it a specified amount of days before the proposed vacation date (depending on your business's needs), will minimize both potential disruptions to your operations and the number of vacation requests you're denying.
A successful unlimited PTO policy is all about trust and communication, between employees and managers particularly. If guidelines are planned out early on in a cooperative and transparent manner, it’s a lot easier to ensure it runs smoothly.
Unlimited PTO: What the Data Says
However, according to the available data, it's unlikely that companies with unlimited PTO are worrying about staff abusing their vacation system.
Last year, HR software company Namely examined the PTO plans offered by 1,000 businesses they work closely with.
Namely found that the average employee in a company with an unlimited PTO policy took an average of just 12.09 days off per year, whereas employees at companies with limited PTO policies took 11.36 days off.
Interestingly, when Namely ran a similar study back in 2018, they actually found that employees with unlimited PTO actually took less time off per year (13) than employees with limited vacation time (15).
Namely also revealed, between the last time they conducted this study (2018) and 2022, the number of companies offering unlimited PTO rose by 34.5% – which may suggest more companies are willing to put myths and misconceptions about the negative outcomes of unlimited PTO to one side.
Should My Company Adopt Unlimited PTO?
Thousands of companies now offer unlimited vacation to employees, so your business certainly won’t be alone in doing so. Many companies report the positive effects of giving employees more power over how much time they take off work.
For HR software company Checkr, it “allows [their] employees to have more flexibility in their schedules, making it easier for them to balance personal and professional responsibilities” Chief People and Operations Officer Linda Schaffer explains.
She says that Checkr’s teams are “happier, more productive and engaged” and that this has culminated in “improved customer service satisfaction scores.”
“Going on vacation helps prevent employee burnout. Giving my employees breaks has had a big effect on my business's effectiveness and productivity” – Spencer Reese, CEO of Millitary Money Manual.
Zephyr Chan, founder of bettertools.io, said he's seen an “increase in results” since unlimited PTO was rolled out at his company.
“Without even pressing employees or increasing their workload, there is an innate sense of responsibility among workers” he explained to Tech.co. “…Productivity has skyrocketed. Our employees understand that this is a give-and-take situation. They benefit the company, and in return, we take care of them.”
Hidden Benefits of an Unlimited PTO Policy
Although it’s a pretty big benefit, allowing employees to take the time off that they need to in order to revitalize themselves for maximum productivity isn’t the only good thing about PTO.
“Under traditional PTO policy, employees usually rush towards availing the days off during December,” Editor-in-Chief of Inside Tech World, Aima Irfan, explains. “This resulted in a lot of employees taking time off at the same time. This is no longer the case anymore.
“With the unlimited PTO, the time off for employees is equally spread out over the year. Conclusively, it has helped us boost results, revenue, number of employees, and business growth” – Aima Irfan, Editor-in-Chief, Inside Tech World.
Spencer Reese of Military Money Manual found that upskilling staff was easier after instating an unlimited PTO policy.
“I can cross-train other employees while some are at work and the others are gone. This helps them become more effective as a team and provides an excellent backup in case employees suddenly leave” he told Tech.co.
Unlimited PTO can also be a godsend to parents of young children.
“Working at a company that offers unlimited vacation is a game changer – as a parent!” explains Sarah Crimes, Marketing Director at British firm The Point. 1888.
“As we all know children's holidays are long… having more flexibility around the amount of holiday I take has massively improved my life and means I have to pay far less in childcare costs over the holidays.”
It's also a great way to keep talented individuals at your company. “Retaining employees is a fairly difficult task that most companies struggle with,” says Paul Mallory, CEO of ConsumerGravity, who described unlimited vacation days as “the answer to this problem”.
On top of this, Mallory says his “company’s productivity levels have increased, and employees are now more efficient than before”.
Creating an Unlimited PTO Policy
The data discussed earlier on in this article suggests that, on the whole, companies with unlimited PTO should probably be more worried about employees not taking enough time off, rather than taking off too much. With that in mind, here are some tips if your business wants to launch an unlimited PTO policy:
- Don’t call it unlimited PTO. Although this might sound good on a job listing designed to persuade people to apply, it’s hyperbolic. There are better ways to describe the process of employees having more power over how much time they take off work. Zoom’s “My-Time-Off” is a great example.
- Have a structured vacation request system. Having a system in place that will allow employees to book time off as and when they need to and minimize, as well as guidelines on when it is appropriate to do so, will ensure everyone is on the same page and you’re not constantly denying requests and in turn tanking morale.
- Connect it to your company values. LinkedIn links its discretionary time off policy to the company's “act like an owner” value. If employees can clearly see how unlimited PTO fits into your company's over-arching value structure, they’re more likely to utilize it in the right way, and for the right reasons.
- Enforce “minimum” time off. You can still offer unlimited PTO as well as provide a baseline number of days employees must take off per year, which is what companies like Skillshare do. This will ensure all employees understand that the company supports their decision to have time away from the office.
Most importantly, if your company is looking to offer an unlimited PTO plan, ensure you’re not inadvertently discouraging employees from taking time off by overloading them with work. This will make them less inclined to take days off and, in the long run, burn out.
2023 is going to be a tough year for many businesses – so looking for new ways to incentivize employees, retain talent, and hire high-quality staff is only natural. Judging by the experiences of businesses that already have one, an unlimited PTO policy can definitely be part of the answer.