Why You Should Eliminate Your Paid Time Off Policies

Andy Porter Andy Porter, Bad HR, Benefits, Good HR, Workplace Flexibilty

Let’s meet Bill:

Bill’s a hard-working guy who always meet his goals (sometimes exceeding them). He’s more than willing to help out others on his team, and he regularly puts in hours on nights and weekends, much to the chagrin of his family (don’t even bring up the smartphone). He’s a professional and paid well to care about his work and get it done. This same guy who busts his hump year after year for his company more than likely has to sit down with his family at the beginning of every year and figure out how he’s going to ration out his 10 vacation days and handful (if any) of personal days. You probably know that in a family that has two working parents and a couple of kids, you can burn through 10 days in no time with all the random stuff that pops up in life.

In case you haven’t heard, working professionals in the US are among the worst at encouraging people to take time off. Pretty depressing, isn’t it? But it gets even worse. This same guy who is happy (most of the time) to put in extra hours has to accrue any hours he wants to take off before he uses it, and then has to have every hour/day he takes tracked by his company. Uggh. What is this, 1950?

I happen to believe that a modern organization doesn’t need to have a formal paid time off policy. In my opinion, there’s little to no value in the ol’ accrue, use, carryover plans of yesteryear. If you’ve been reading my posts here for the last few years a) thank you, b) if you treat people like adults they’ll act like adults and c) I tend to cringe at any HR policy or process that adds bureaucracy (and subtracts value) from an organization. You know, things like performance ratings, employee handbooks, titles (and all the “privilege” that come along with titles),

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and now paid time off policies. In general, if there’s a process that exists in an organization solely because “HR needs it,” it’s by definition a waste. And paid time off policies are a waste. Why?

  • In today’s world the line between work and home is blurry at best. Most of us answer emails at all hours of the day, weekends and while on vacation. I would bet a lot of you think about work when you’re not “working” as well. So where do you draw the line on what’s time off and what’s not?
  • Accrued time off balances are notoriously inaccurate. Sure, you might have a fancy tracking system but they’re only as good as the data entered (or not) into them. And that inaccurate number gets translated into a dollar amount that sits on the books and can’t be spent on anything else.

In this case, the advice I’m about to give you is something we’ve actually done at my company. We eliminated accrued time off, offered some guidelines on how much time we thought was appropriate (4-5 weeks per year, standard for our industry) and simply told people to work out the details with the manager and team. More importantly, here’s why we did it:

  • Spend our time focusing on hiring as many Bills as possible (i.e., people who care and won’t abuse freedom), so we beefed up our selection process instead.
  • We want a work environment built on trust and responsibility, and the old time off system felt like it was designed in a way that assumed we shouldn’t trust people.
  • Expect people to deliver exceptional results (until they prove otherwise) If people deliver, then why should we care exactly how much time they take off every year? If they aren’t delivering, taking time off is a second or third order problem (meaning it’s not the real problem).
  • Our demographics demand that to compete for talent in our marketplace (large percentages of people with children and people with families all over the world) then we need to be flexible.

Now, I get it that this type of system wouldn’t work for every company out there. But my broader point is this–don’t just default to what everyone else is going. Challenge conventional thinking and do what’s right for YOUR company!