Jul 20, 2011 | Post by: Vikki Pachera Comments Off on Open-Ended Vacation Policy…A good thing?

Open-Ended Vacation Policy…A good thing?

During the peak of the summer vacation season, interesting article in the Wall Street Journal by Sue Shellenbarger on  the open-ended vacation policy.

“Take as much vacation as you need”…sounds fantastic!  The policy works well in many Silicon Valley companies like NetFlix.

Could this be a blessing or a pressure-filled decision for employees looking to keep their jobs in an extremely competitive workforce?


Unlimited Vacation, but Can You Take It?

By Sue Shellenbarger

Imagine there is no limit: Your boss gives you as much vacation as you want, whenever you want to take it.

Some companies are doing away with vacation allotments and letting employees take time off as they see fit. But as Sue Shellenbarger explains, the policy can cause problems.

Sound like a dream employer? Or could it be a clever tactic to keep you on edge and at your desk?

A growing number of employees at companies with “no-vacation” or “open-ended-time-off” policies are deciding how much time they dare take off as peak summer vacation season approaches.

A few companies started open-ended vacation plans in the 1990s, but such policies have gained momentum in the past few years among high-tech, professional-services and other white-collar employers.

Workers get no guaranteed amount, or official limit, of vacation time, but they have to get time off approved and generally have to make sure things go smoothly in their absence. Some employers promote this as liberating, saying their workplaces are so flexible that old-fashioned constraints such as assigned time off aren’t needed. But others say the lack of guidelines fuels a tendency to work all the time.

Open-ended vacations mesh well with the open-ended workday at Netflix Inc. In 2004, the Los Gatos, Calif., company stopped tracking vacations in order to “focus on what people get done, not on how many hours or days” they work, according to a company presentation at the time.

Spokesman Steve Swasey says the practice suits the culture at fast-growing Netflix. “We work weekends and around the clock; people work many hours,” often from home or elsewhere via laptop or smartphones, he says.

While no one tracks vacation time, he estimates Netflix’s 800 employees are taking about three to five weeks off a year under the policy—more than in the past. Roma De, a director of product management who has been at Netflix for 15 months, says she will take four weeks off this year, more than at previous employers.

The question of how much vacation time one should be allowed never comes up, she says. “It’s: ‘How does it fit into your life, and is it important to you, and how do you and your colleagues balance it out?'”

Mr. Swasey says Netflix employees keep in touch via email or phone when they are on vacation. “People are on all the time.”

During a three-week trip to Africa with his wife last year, he logged on and made work decisions in Johannesburg. Mr. Swasey says he doesn’t mind working while away, but “sometimes my wife is not so sure. I’ve been known to hide away on the balcony of the condo in the early hours, when she’s sleeping.”

About 2% of employers offer a “results-only work environment,” where workers are given control over time off and where and when they work, and are evaluated solely on results, says a 2011 survey of 600 employers by the Society for Human Resource Management, an HR professional group in Alexandria, Va.

But Americans have trouble taking time off even when they are assigned a specific number of days. Only 38% of U.S. employees use all their allotted vacation time, says a 2010 survey of 9,000 people by travel-booking company Expedia.com; the average worker took only 14 of 18 days permitted.

And it isn’t usually managers’ fault. According to the Expedia survey, only 5% of Americans said their bosses weren’t supportive of their taking allotted time off.

Instead, many people think: “I need to have this face time. I don’t want to be the next one laid off when the company downsizes again,” says John de Graaf, executive director of Take Back Your Time, Seattle, a nonprofit that researches the effects of overwork. And because few employers cross-train workers to pick up each other’s duties, many employees dread returning from vacation to huge stacks of e-mail and unfinished work, he says.

Although Jason Evanish of Boston had unlimited vacation time at a previous employer, “it was really hard to walk away,” because staffing was so lean, he says. Even on the few vacation days he took, “you’re always kind of stressed, not only because you’ll have a tremendous amount of work when you return, but because you worry about holding back other members of the team,” says Mr. Evanish, co-founder of GreenhornConnect.com, a website for entrepreneurs.

Ryan LLC, Dallas, a tax-services company, started open-ended vacations in 2008 as part of a move to a flexible “work anywhere, anytime” policy to lower employee turnover. What makes the approach work is setting clear, measurable performance targets and feedback, says Delta Emerson, a senior vice president. Since the policy was put in place, turnover has dropped to 6.8% in 2010 from 18.5% in 2007, Ms. Emerson says, though some employees still struggle with “giving themselves enough latitude” for vacation, she says.

Wall-to-wall work is exactly what Apolinaras Sinkevicius, director of operations at Pixability, a producer of business videos in Cambridge, Mass., wants to avoid. Long hours without breaks can lead to a higher error rate and lower-quality products, he says.

To get his employees to take more time off, Mr. Sinkevicius started offering anyone who takes off 10 consecutive workdays an additional two weeks’ paid time off, to use as they please. Several employees have taken him up on the offer, he says.

Of course, vacations serve many purposes for employers beyond keeping employees fresh and content. Some financial-services companies require workers to take at least two weeks off, to expose any covert back-office irregularities. Vacations also ensure that people learn each other’s jobs, so no one employee becomes indispensable.

Motley Fool, an Alexandria, Va., multimedia financial-services company, has had open-ended vacation since its founding 18 years ago. Most people take about four weeks off, says Lee Burbage, Motley Fool’s top human-resources executive.

But the company also has a monthly ritual that requires everybody to be ready to go on short notice. At a meeting of all 250 employees, one name is drawn from a hat. That person must take off two consecutive weeks some time in the ensuing month.

The lottery winners have to tell the whole company later what they did on their vacation. Tales have ranged from climbing a mountain to building a tree house. “You don’t want to be the one who says, ‘I watched ‘Buffy the Vampire Slayer’ and sat on the couch for two weeks,'” says Ellen Bowman, a newsletter editor at Motley Fool.

Ms. Bowman hasn’t won the lottery yet, but if she does, she has a plan: She will finish a romance novel she’s been working on for years.

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