Unlimited PTO Is Often Touted as a Workplace Perk—but Is It a Scam?

The vacation policy was an enticing incentive. Jennifer, an Atlanta-based media specialist, had 28 days off in her first year on the job. “Our managers were pushing for a good work-life balance,” she explained.

Eventually, in a move the company said would better compensate employees, it pivoted to unlimited paid time off. Jennifer, an avid traveler, was thrilled at first. But what was supposed to be a perk soon proved otherwise. Time off hoarding and snitching ensued.

“It got to the point where people were counting other people’s paid time off,” Jennifer, who preferred not to be named, told Travel + Leisure, “and saying ‘So and so took 67 days off, I’ve only taken 35, how is that fair?’”

Jennifer’s company is in the process of rescinding the policy for her department.

“People hear you have it and are like ‘Oh my gosh, I’m so jealous, you have unlimited PTO.’ But from my experience, it’s not all it’s cracked up to be.”

Is unlimited PTO the workplace policy well-heeled travelers dream of, or a matter of being careful what you wish for?

Perception vs Reality

During the past decade, unlimited PTO has been touted as the ultimate recruiting tool as employers seek to put work-life balance into practice.

While still rare—data from the Society for Human Resource Management or SHRM indicates just 7 percent of American employers offer it—the policy is very much in demand. A recent survey from Empower showed one in five American employees wouldn’t consider a new job at a firm that didn’t extend endless off days.

“There’s a very powerful message when an organization adopts unlimited PTO,” Julie Schweber, senior advisor at SHRM, told T+L. “It says ‘We value you. We trust you. We trust you’ll get your work done.’ I can’t think of a better retention tool or motivator for employees.”

But that retention tool can quickly go sideways, as experienced by one Detroit-area senior systems engineer, who requested to be unnamed. His firm’s unlimited PTO policy hasn’t been the benefit he’d hoped for. “I have been subtly told by my manager that the ‘perception is you’re taking too much time off,’” he said. “How do you plan to travel with that hanging over your head?”

What’s more: his unlimited days can’t be banked or paid out at the end of employment. He’s soured on the idea altogether. “I view the concept of unlimited PTO as more of a PR gimmick and a way for a firm to get out of providing a quantifiable benefit,” he said.

Having the Option

A.J. Stackawitz, a senior executive assistant and office manager at a small development business in Denver, is a fan of her team’s unlimited PTO policy. Her husband is a pilot and travel is a top priority for her family. She says the flexibility is indeed a perk, even if it means completely unplugging isn’t always possible. Her company policy is clear: she stays on top of critical assignments, and may be required to respond to emails, calls or texts while taking time off.

“We’re supposed to tend to things that we need to tend to,” she said. “So that might mean I’m with my family in Hawaii for two weeks, but on one of those days I have to book someone’s airfare or check email.”

Sick leave is separate, so there is no mixing or confusing the two. Stackawitz clears decks before she leaves town and doesn’t mind an occasional check-in. She says the policy works well for her.

“It would be hard to go back to the other way now,” she said. “Just knowing you have the option is a morale booster. It’s a tradeoff that I appreciate, and the bottom line is that it’s worth it.”

A Question of Balance

Unlimited PTO won’t work for every company. Employers should consider the following before putting it into place:

• A culture of trust and respect is crucial.
• Workload and performance should be effectively managed. This might mean caps on unlimited PTO during certain times of year, or that advance approval is necessary.
• The policy must be fair, clear, and well-communicated.

“Otherwise, you’ve got this guilt creep, the shaming of someone for taking PTO,” Schweber said.

That creep is pervasive. A recent Harris Poll showed nearly half of American workers (47 percent) report feeling guilty taking time away, and about the same amount (49 percent) get nervous requesting time off.

Limitless time off won’t fix the inability to fully disconnect from the workplace if people are already afraid to do it. That said, when a company implements it well and fairly, it can free employees up to travel extensively and unplug. However, a lack of guardrails or clarity could transform what’s perceived as a top perk into a real pain.

Jennifer learned that first-hand.

“If I heard ‘unlimited PTO’ now, it wouldn’t have the same appeal,” she said.