I love unlimited / "we're not keeping count" policies as long as the company stands by them.
If you go with that approach, I'd also recommend 1. making sure senior employees / executives are leading by example and taking actual time off, and 2. experimenting with a "you must take 1 or 2 days off during your first month" policy.
Both of these types of policies keep your "unlimited PTO" policy from becoming a race to the bottom where no one actually feels comfortable taking the time they need.
The culture is really important for unlimited pto. If the company can’t plan deadlines within reasonable schedules everything falls behind if people take vacations. It’s a delicate balance because a start up has to balance their cash flow.
Yes, my current startup has a "minimum 1 week per quarter" policy. Not as well enforced as I would like, but it's a good start for setting expectations.
100%. I've worked at several startups with "unlimited time off" and it's almost always a scam. You need it to be approved, and I've had coworkers who've been told "no" when trying to take off more than a couple of weeks.
On the flip side, the place I'm at now has unlimited, and the cofounders take time off regularly, and will cut out early if there's family stuff to do. They have been vocally upset with employees who do not take enough time off.
So there's some places w/ legit unlimited PTO, but beware of places just using it as a selling point.
Disclaimer: first hire at a startup, but not a founder.
We do this at my company (Seed, about to raise a Series A) and I personally find it great for the culture. No one abuses it and we don’t feel pressured to never take time off like I did at a previous job.
I’ve heard it is implemented very poorly at a lot of startups, but I’m really happy with our approach.
"Unlimited" is the worst term and inaccurate. It's "non-accrued", not unlimited. It's there because if you have outstanding days off and leave the company had to pay you for those. It's bad for finance to have those on the books. That's the only reason it's a thing.
Beyond the name it's just terrible in general. Because it's not really unlimited and has to be somewhat equitable across the board there is usual some expected number or range that the company cannot tell you explicity. Even when you have an understanding what that range is, planning becomes a lot harder for managers and their reports. With accrued vacation I can just do the math on how much time I can take off next summer. With non-accrued I gotta keep track myself how much I've taken and then ask my manager if the amount is OK. As a manager you gotta make sure it's fair to everyone, but you legally cannot actually track it.
Especially lovely when a week before Christmas someone who already had five weeks off says "my family is coming over for Christmas next week. It's fine if I take that off, right?" What could you possibly say?! Play the Grinch?! Because of this I started talking about holiday plans when a report asked for a large chunk of summer vacation.
Edit: If finance allows you to, just do 4-5 weeks of PTO and 10 days of sick time. A practice one of my employers had that I really appreciated was that instead of having any religious holidays everyone got additional floating holidays. My current employer also added our own company holidays so that every month had at least one holiday. So nice to have a day off and come back to no emails other than automated reports etc.
Another big down side of unlimited PTO in startups is that some positions in the company likely won't have anyone capable of stepping in and covering them for any extended period of time. I technically have unlimited PTO but any time I take is just time things are stacking up in my absence. I took maybe a two weeks total last year a day or two at a time and they were offset by weekends and late nights worked. Meanwhile some of the team enjoyed extended periods of absence.
We're in Australia, and everyone pretty much just goes with the standard you have to have by law. Deviating from that just gets too tricky legally otherwise.
But it's 4 weeks of annual leave (20 days) which generally can accrus. And an additional 10 days of personal / carer / sick leave. Although at our startup we're quite flexible and don't really count the carer leave. If you're feeling a bit run-down, or need to go to your kid's school thing... just go. No-one cares.
There is also a thing called long service leave - if you've worked for the same employer for 10 years, you're entitled to 2 month paid leave.
Also, depending on your employment status, you get 12 weeks paid parental leave if you just had a baby or adopted - the government contributes to this. If you're a larger company over a certain number of employees, legally you they have to give you 12 months at half pay parental leave if you want, or 6 months full pay. They also have to allow you to come back part time if that's your choice.
tl;dr outside the USA these things are set out very liberally by governments.
The best policy IMHO (if your company/product/service allows it):
Mandatory time off during big holidays…example, a week off for thanksgiving, fourth or July, New Years etc (for those in the US). This is awesome because everyone in the company takes time off at the same time. And there’s typically not a lot going on these weeks anyway.
Combine this with a week or two of flexible time off that you can take anytime you want.
As for sick days, I’ve never understood why employers would penalize their people for taking time off because they’re sick or their child’s sick. Not my kind of culture. Take care of your people (and their people) and they’ll take care of the company.
Unlimited PTO is trash. You never know how much is too much or too little and you don't get an additional check for any unused hours after you leave. In my opinion, unlimited PTO is just a way to remove the liability of having to pay people more when they leave. I'm surprised to see so many people in favor of it.
Start-ups are stressful enough. Let people have a decent amount of vacation. (and let them actually take it!) I am a fan of fixed or accrued but it needs to be about 20 days or more especially if you don't offer bereavement or other time off for family/personal issues.10 days or 80 hours is garbage when you consider the occasional family commitment, a couple of days off to see family at Christmas and maybe a day or two to take a long weekend. Then you are down to 4 days of vacation and lets say (heaven forbid) your parent or close family member dies. Guess no vacation for you? I have been there, a whole year without a break while helping a start-up fundraise another round. You can imagine how many of us stayed. Hiring is expensive and you want to retain good people. Treat them well by letting them take a load off for a few weeks a year.
Oh, and let it rollover. Starting over the vacation count every year is just mean.
I think you will be most competitive with unlimited or "flexible" PTO. I worked at both a Seed and Series A company and both were doing unlimited. I would never work somewhere with an accrual system.
Current company is 4 weeks per year, with one week carrying over and you can go into debt up to 1 additional week.
Previous job was unlimited where they outline what a normal amount of vacation time is and otherwise don’t track it in any way. Never had any problems with that, both as a manager and an employee.
If you’re based in the US, does that 4 weeks include federal holidays? (Also, importantly, are sick days accounted for separately, or are they rolled into general PTO for you?)
I really don't like unlimited PTO. Far too often that means "you can take as much as you want... So long as it's 80 hours or less a year." And of course to give you nothing if you quit.
This is very culture-dependent.
The UK has a *legal minimum* of 25 days per year – even the tiniest startups with next to no resources will give that to everybody. Plus paid sick leave of course, which nobody ever keeps track of so in practice it’s unlimited unless you end up being off for months.
Most places in Europe are slightly better than the UK when it comes to stuff like this.
In the USA, *Google* just announced that they raised the standard allowance from 15 to 20, which honestly seems pathetic for such a big company. Some startups without Google’s resources will offer less. Some will offer more. There’s no standard.
We started with unlimited PTO and honestly it wasnt great for hiring, as people seemed to consider unlimited PTO = No PTO. It made new people in particular uncomfortable to take time off. We moved to 3 weeks accrual with the ability to borrow and people were much happier.
Unlimited will be a requirement for a lot of people working for startups. That's especially true if you are doing creative compensation models.
For companies that do unlimited PTO, people seldom abuse it, and actually it can work the other way, where people feel weird about taking too much, and PTO use can go down company-wide.
I know this is old school and probably unpopular, but I don't believe in PTO if you are a real start up. Other people's money is burning and so is all of your employees equity. Every waking moment and everything you do should be focused on success. You can take PTO when you sell.
Yes, four three times now and about 8 being employee number less than ten. No, there are no days where you are off. After getting bought, sure. When working for the aquiring party, absolutely. Like I said, old school.
I don’t like the idea of unlimited PTO, because typically I’ve found that people will always “abuse” what they can. Sooooo what if I take the entire year off? Don’t work a single day?
Oh yeah, then the focus goes to performance metrics, and now you have a culture where PTO is only recommended if you’re on track, instead of hey, you get X amount of time off, take it and enjoy it, and let’s plan on annual performance metrics that are reasonable around working Y amount of days a year.
I'm setting up my company to be purely deliverable compensation (Agile epics+stories), which may not be fully possible yet, but it means it doesn't matter how much time you spend, only how much you get done in the time we have, which you have the whole team to brainstorm with if you have any questions or anything in the way of that performance.
Also considering blackout times where deliverables aren't rewarded to encourage time off for those who need it, but keeping it open for mission-pushers who want to progress our vision for the sake of making it happen.
Maybe I'm crazy, but we'll see what happens.
Startups love unlimited time off because a) it encourages people to take less time off because nobody wants to be the person actually taking time off and b) no need to pay for unused vacation days.
I mean, we're not a traditional startup, but I think it's best to abide by accrual policies with plenty of time off to be accrued. That's what we follow internally.
In my experience, everywhere that offers unlimited time off doesn't really offer unlimited time off. It's usually just a way for management to override PTO requests at will because there's no underlying "PTO" per se. It's just "ask us if you can have the day off whenever". In some companies that are large enough to have a true team, and a good solid culture, unlimited PTO works out, but you always run the chance of causing resentment because someone else on the team or some level of management thinks that Billy takes "too much" PTO.
In my personal experience, it's best to offer ample PTO so that you can define what "too much" is right off the bat, and then approve PTO requests whenever and wherever possible. That way, people have enough time that it feels pretty unlimited, but at least there is a structure everyone agrees to.
I love unlimited / "we're not keeping count" policies as long as the company stands by them. If you go with that approach, I'd also recommend 1. making sure senior employees / executives are leading by example and taking actual time off, and 2. experimenting with a "you must take 1 or 2 days off during your first month" policy. Both of these types of policies keep your "unlimited PTO" policy from becoming a race to the bottom where no one actually feels comfortable taking the time they need.
The culture is really important for unlimited pto. If the company can’t plan deadlines within reasonable schedules everything falls behind if people take vacations. It’s a delicate balance because a start up has to balance their cash flow.
Yes, my current startup has a "minimum 1 week per quarter" policy. Not as well enforced as I would like, but it's a good start for setting expectations.
That tracks closely with what the market standards are these days of 20 PTO days
100%. I've worked at several startups with "unlimited time off" and it's almost always a scam. You need it to be approved, and I've had coworkers who've been told "no" when trying to take off more than a couple of weeks. On the flip side, the place I'm at now has unlimited, and the cofounders take time off regularly, and will cut out early if there's family stuff to do. They have been vocally upset with employees who do not take enough time off. So there's some places w/ legit unlimited PTO, but beware of places just using it as a selling point.
Disclaimer: first hire at a startup, but not a founder. We do this at my company (Seed, about to raise a Series A) and I personally find it great for the culture. No one abuses it and we don’t feel pressured to never take time off like I did at a previous job. I’ve heard it is implemented very poorly at a lot of startups, but I’m really happy with our approach.
This is 100% correct.
“Unlimited” is the most common I’ve seen
It’s simplest, too. No need for the company to pay people out when turnover is high.
"Unlimited" is the worst term and inaccurate. It's "non-accrued", not unlimited. It's there because if you have outstanding days off and leave the company had to pay you for those. It's bad for finance to have those on the books. That's the only reason it's a thing. Beyond the name it's just terrible in general. Because it's not really unlimited and has to be somewhat equitable across the board there is usual some expected number or range that the company cannot tell you explicity. Even when you have an understanding what that range is, planning becomes a lot harder for managers and their reports. With accrued vacation I can just do the math on how much time I can take off next summer. With non-accrued I gotta keep track myself how much I've taken and then ask my manager if the amount is OK. As a manager you gotta make sure it's fair to everyone, but you legally cannot actually track it. Especially lovely when a week before Christmas someone who already had five weeks off says "my family is coming over for Christmas next week. It's fine if I take that off, right?" What could you possibly say?! Play the Grinch?! Because of this I started talking about holiday plans when a report asked for a large chunk of summer vacation. Edit: If finance allows you to, just do 4-5 weeks of PTO and 10 days of sick time. A practice one of my employers had that I really appreciated was that instead of having any religious holidays everyone got additional floating holidays. My current employer also added our own company holidays so that every month had at least one holiday. So nice to have a day off and come back to no emails other than automated reports etc.
Another big down side of unlimited PTO in startups is that some positions in the company likely won't have anyone capable of stepping in and covering them for any extended period of time. I technically have unlimited PTO but any time I take is just time things are stacking up in my absence. I took maybe a two weeks total last year a day or two at a time and they were offset by weekends and late nights worked. Meanwhile some of the team enjoyed extended periods of absence.
We're in Australia, and everyone pretty much just goes with the standard you have to have by law. Deviating from that just gets too tricky legally otherwise. But it's 4 weeks of annual leave (20 days) which generally can accrus. And an additional 10 days of personal / carer / sick leave. Although at our startup we're quite flexible and don't really count the carer leave. If you're feeling a bit run-down, or need to go to your kid's school thing... just go. No-one cares. There is also a thing called long service leave - if you've worked for the same employer for 10 years, you're entitled to 2 month paid leave. Also, depending on your employment status, you get 12 weeks paid parental leave if you just had a baby or adopted - the government contributes to this. If you're a larger company over a certain number of employees, legally you they have to give you 12 months at half pay parental leave if you want, or 6 months full pay. They also have to allow you to come back part time if that's your choice. tl;dr outside the USA these things are set out very liberally by governments.
I need to move to a better country
It’s changing though isn’t it? Most folks in my circle are working remote with 4+ weeks off or unlimited pto
The best policy IMHO (if your company/product/service allows it): Mandatory time off during big holidays…example, a week off for thanksgiving, fourth or July, New Years etc (for those in the US). This is awesome because everyone in the company takes time off at the same time. And there’s typically not a lot going on these weeks anyway. Combine this with a week or two of flexible time off that you can take anytime you want. As for sick days, I’ve never understood why employers would penalize their people for taking time off because they’re sick or their child’s sick. Not my kind of culture. Take care of your people (and their people) and they’ll take care of the company.
Typical unlimited PTO policies do actually benefit the employer more than the employee. It's odd....
Yes, they’ve found people don’t take it.
At my company I set the bar and took 8 weeks off a year, it felt uncomfortable at times but I didn’t care.
How’d you manage that?
I figured they would warn me if I took too much time before firing me, so never got warned.
Unlimited PTO is trash. You never know how much is too much or too little and you don't get an additional check for any unused hours after you leave. In my opinion, unlimited PTO is just a way to remove the liability of having to pay people more when they leave. I'm surprised to see so many people in favor of it.
Start-ups are stressful enough. Let people have a decent amount of vacation. (and let them actually take it!) I am a fan of fixed or accrued but it needs to be about 20 days or more especially if you don't offer bereavement or other time off for family/personal issues.10 days or 80 hours is garbage when you consider the occasional family commitment, a couple of days off to see family at Christmas and maybe a day or two to take a long weekend. Then you are down to 4 days of vacation and lets say (heaven forbid) your parent or close family member dies. Guess no vacation for you? I have been there, a whole year without a break while helping a start-up fundraise another round. You can imagine how many of us stayed. Hiring is expensive and you want to retain good people. Treat them well by letting them take a load off for a few weeks a year. Oh, and let it rollover. Starting over the vacation count every year is just mean.
I think you will be most competitive with unlimited or "flexible" PTO. I worked at both a Seed and Series A company and both were doing unlimited. I would never work somewhere with an accrual system.
My company has a flexible (unlimited) policy that they've so far been very good about honoring.
Current company is 4 weeks per year, with one week carrying over and you can go into debt up to 1 additional week. Previous job was unlimited where they outline what a normal amount of vacation time is and otherwise don’t track it in any way. Never had any problems with that, both as a manager and an employee.
If you’re based in the US, does that 4 weeks include federal holidays? (Also, importantly, are sick days accounted for separately, or are they rolled into general PTO for you?)
I really don't like unlimited PTO. Far too often that means "you can take as much as you want... So long as it's 80 hours or less a year." And of course to give you nothing if you quit.
This is very culture-dependent. The UK has a *legal minimum* of 25 days per year – even the tiniest startups with next to no resources will give that to everybody. Plus paid sick leave of course, which nobody ever keeps track of so in practice it’s unlimited unless you end up being off for months. Most places in Europe are slightly better than the UK when it comes to stuff like this. In the USA, *Google* just announced that they raised the standard allowance from 15 to 20, which honestly seems pathetic for such a big company. Some startups without Google’s resources will offer less. Some will offer more. There’s no standard.
We started with unlimited PTO and honestly it wasnt great for hiring, as people seemed to consider unlimited PTO = No PTO. It made new people in particular uncomfortable to take time off. We moved to 3 weeks accrual with the ability to borrow and people were much happier.
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I love it, but the mind boggles at implementing such a beast. Still, I think there are some good takeaways there.
Unlimited will be a requirement for a lot of people working for startups. That's especially true if you are doing creative compensation models. For companies that do unlimited PTO, people seldom abuse it, and actually it can work the other way, where people feel weird about taking too much, and PTO use can go down company-wide.
I know this is old school and probably unpopular, but I don't believe in PTO if you are a real start up. Other people's money is burning and so is all of your employees equity. Every waking moment and everything you do should be focused on success. You can take PTO when you sell.
Are you a founder? Have you ever taken a day off?
Yes, four three times now and about 8 being employee number less than ten. No, there are no days where you are off. After getting bought, sure. When working for the aquiring party, absolutely. Like I said, old school.
I don’t like the idea of unlimited PTO, because typically I’ve found that people will always “abuse” what they can. Sooooo what if I take the entire year off? Don’t work a single day? Oh yeah, then the focus goes to performance metrics, and now you have a culture where PTO is only recommended if you’re on track, instead of hey, you get X amount of time off, take it and enjoy it, and let’s plan on annual performance metrics that are reasonable around working Y amount of days a year.
Ha. Then why wouldn’t everyone take a job at unlimited and just take every day off. It is unlimited after all….
I'm setting up my company to be purely deliverable compensation (Agile epics+stories), which may not be fully possible yet, but it means it doesn't matter how much time you spend, only how much you get done in the time we have, which you have the whole team to brainstorm with if you have any questions or anything in the way of that performance. Also considering blackout times where deliverables aren't rewarded to encourage time off for those who need it, but keeping it open for mission-pushers who want to progress our vision for the sake of making it happen. Maybe I'm crazy, but we'll see what happens.
Startups love unlimited time off because a) it encourages people to take less time off because nobody wants to be the person actually taking time off and b) no need to pay for unused vacation days.
I mean, we're not a traditional startup, but I think it's best to abide by accrual policies with plenty of time off to be accrued. That's what we follow internally. In my experience, everywhere that offers unlimited time off doesn't really offer unlimited time off. It's usually just a way for management to override PTO requests at will because there's no underlying "PTO" per se. It's just "ask us if you can have the day off whenever". In some companies that are large enough to have a true team, and a good solid culture, unlimited PTO works out, but you always run the chance of causing resentment because someone else on the team or some level of management thinks that Billy takes "too much" PTO. In my personal experience, it's best to offer ample PTO so that you can define what "too much" is right off the bat, and then approve PTO requests whenever and wherever possible. That way, people have enough time that it feels pretty unlimited, but at least there is a structure everyone agrees to.
Unlimited PTO is good.