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Unlimited PTO

There seems to be an endless list of employment practice decisions to make to meet the needs of your organization.  This includes considerations for attracting and hiring talent, retention, and a comprehensive benefits program that supports a healthy life work balance.  Leave policies serve several purposes, including improved morale, productivity, and cost savings.  There are considerations to make when exploring a migration away from a discretionary limit of paid time off and an unlimited practice.

Included in these considerations must be company culture, accountability, performance management, regulatory obligations, operational needs, and financial liability.

When implementing an unlimited paid time off policy, be certain to account for the following: (1) the impact of Federal or State FMLA leave; (2) the impact of mandatory State leave laws related to sick time, domestic abuse, jury duty, etc.; (3) the impact of Short Term Disability plan design and benefits; (4) the impact on disciplinary or corrective action policies; and (5) the impact on your financial obligations and budget.

You can achieve an effective balance between the risk and the rewards of an unlimited policy if you place maximum limits related to specific workplace events and design a request and approval process that ensures fair and consistent application of the policy.  You need to avoid creating a culture of guilt which prohibits use of the policy and diminishes the value, create specific blackout periods for which time may not be taken, and most importantly train and communicate all aspects of the policy to the workforce regularly to reinforce the benefits and expectations for effective use.  Ultimately, the success or failure of this policy will depend on the effective management and enforcement of the policy and procedures by your supervisors.