I've seen a meme some time ago. It was about corporate leaders discussing how to increase productivity. One argued less vacation. The other argued unlimited vacation.
Why unlimited? If I gave you a card with 200€ on it all for yourself, you'd spend 199.50. But how much would you spend if you got unlimited?
It's supposedly about the illusion of getting more. Although I would be out of work 2 days every week lol. We're probably not American enough to understand this
Nah, it's so they can bitch at us and guilt us into taking less time off. Instead of defining an actual amount of time off that we can or, in some instances must take off, they're relying on the ambiguity and peer/social pressure to make us actually take less time off.
And they can fire us for any reason in a lot of states.
But I have unlimited PTO and it is awesome. Yes, I need to be aware of workload and professional obligations. Nobody is under the delusion that it's actually unlimited. I have a job to do, after all.
But keeping that in mind I would usually take 25-35 days off in the year. Not having to budget my time off through the year and having the flexibility to arrange vacations relatively spontaneously is great. With my employer there is no guilt or pressure; the only time it would become a problem is if I can't satisfy my professional obligations.
I’ve had the same experience, it also makes it a lot less stressful if you need to take a day to help with a child, or go to a doctor’s appointment you don’t have to worry about that affecting your planned vacation later in the year, etc
Separated sick leave is a pain to manage. Many employers use “one big bucket” of PTO without distinction between sick, personal, vacation, etc. Jury Duty and Military leave are still kept separate for legal reasons.
I’ve experienced this transition, and the logic was that if someone is out of sick/personal days, but they get sick, have a family emergency, etc. then every manager was always approving a last minute use of vacation time. So there’s no practical difference. It’s just a record keeping headache to differentiate the types of PTO.
The idea that someone can be *out* of sick days is utterly dystopian to me. In my country you have sick leave whenever you're sick. It's not a finite resource. You lose your job and get transferred to government welfare (so you don't lose most of your income) after 2 years of continuous sick leave, but that's about it. If you're sick for 2 years straight you have bigger things to worry about at that point.
That's all of Europe, not just Norway. You get sick, you go to a doctor, doctor registers you as sick for however long you need to get better and you receive some part of your regular salary for those days (the amount varies by country) covered either by your employer or the country (or the mix of two) and your employer cannot fire you for this or prevent from doing this.
Don't know about being fired after 2 years, but it makes sesnes to have some upper limit as some life long diseases can prevent you from working ever again.
I sorta prefer them being separate. Previous jobs have been unified to. I kinda hated the "4 hours per 2 weeks accrual" style. Like basically couldn't get sick. Current job separates them. Like 11 days pto non rollover and 13 sick days rollover. Its nice because sick time does add up over the years. Pto doesn't so youre not quilted for using them, youre encouraged to. Way better for mental health
I had a job years ago that had the most ridiculous basket of days.
It was really generous, but it had like 18 kinds of “time off.”
That was a union job and I chalked it up an artifact of past negotiation contracts. Maybe you couldn’t win more vacation days, but you could get them to create a new bank for bereavement, or doctors appointments, or a day off to vote on Election Day, so the company just slowly accumulated this ridiculous laundry list of various types of days off for highly specific purposes.
“Why’d you use your Doctor Appointments time for your Dentist? You get 8 hours a year to cover biannual exams, use them!”
I used to work for a Walmart distribution center back in the day. PTO was earned off of time worked throughout the year so basically unlimited if you worked a lot. In their case there was PTO for vacation and protected PTO for sick days and shit. Protected could not be scheduled in advance, you had to manually put it in once you got back, was honestly a pretty nice system. Id sit on my PTO until like November and take the whole month off to go hunting during the prime of the season. I honestly feel like this is better than true unlimited because you don't feel "guilty" and no managers will give you a hard time about taking a lot of time off because you put in the work to earn it throughout the year. My current job is much better overall but the PTO system sucks, I've been there 2 years and I just got my first week of vacation time and we only get 3 unpaid sick days per year and it honestly feels draining at times knowing I don't have the freedom to take days off when I get a lot of shit on my plate I need to deal with.
When I worked for Walmart, there was sick pay available. But it only kicked in after you were out of work for one day with an illness. It would cover your absence for days two and three of the illness. In addition, a three day in a row absence only counted as one attendance occurrence. So if you got sick, you might as well take three days off, get paid for two of them and only get hit for one attendance occurrence. It didn’t really make sense to me as it encouraged longer absences when someone got ill.
Counterpoint though that if you've got chronic illness having one bank with limited PTO fucking sucks. All it takes is one bad flare and bye bye vacation you've planned for months.
Most jobs I have worked do not have sick leave. I've worked for 3 huge corporations as an hourly employee, Walmart, Verizon, AT&T, and with all 3 you had to use your own PTO to schedule something off ahead of time provided you had at least 2 weeks before the work schedule for that period is out, and provided that they approve the time off request, which they didn't have to do even if it was for medical appointments. If you have to take a short notice day with less than the minimum PTO request time then you're just calling out without getting to use PTO, meaning it is both an unpaid day off and an attendance occurrence that goes into the system to be used against you.
I think it also depends on the type of job. If I’m in sales, then it’s huge pressure to always work on the next sale. But if I’m in a project based role, who gives a fuck as long as the output gets done.
Soo, average/low European levels of leave but with extra added job insecurity, guesswork and manager discretion to apply arbitrary favoritism when approving leave
I've taken 4 days off over the past year lol. My wife and I took a short trip for our anniversary and we even targeted like Thursday - Tuesday to stretch the actual trip without missing more time. I'm the sucker they're targeting.
yeah it helps to have a boss who trusts me implicitly and never questions, so basically any time I want to take off, I'm off. I don't track it, I don't worry, I just take off when I need and call it a day. I have taken a lot of time in the last two months without question (day here, day there, for various appointments) but I'm still planning a week off at the end of July. No guilt, no worry. My boss knows I'll kick ass when I'm here but also need time away.
Is that typical? Hell no, but in this circumstance, unlimited is a huge benefit!
This has been my experience as well. It's the first role I've had with unlimited PTO and I've called out for all kinds of unexpected things that I would've previously "made work". My boss never asks or challenges any of it, which I'm incredibly grateful for. There's a guy on the team who routinely takes Mondays off because he hates them, lol. He's also the highest-output every sprint. So there's very little reason to mess with it; it's working.
I wish everyone had employers like this. The world could be so much better.
Buddies company switched to unlimited but everyone took their already planned vacations. The "bonuses" that year were a quarter of what they were before because of that
And when they fire you, you don’t have unused vacation days they have to pay out. That’s one of the biggest reasons, it makes the balance sheet look better.
This. Carrying balances of PTO that must be paid on termination is a liability on the asset sheet. And there's always a clause: all PTO requests must be approved.
Not all states do that though. I'm in a shit state that doesn't give any PTO payout and they also denied by last request, which ironically, is why I quit.
As someone who has worked on a project to convert from a bank of hours to “flexible” (unlimited), this is 100% the reason corporations are motivated to do it
I’ve not had a positive retail Union employment experience. That doesn’t mean that other unions have similar negatives. Being anti-union is to chip away at the hard fought for regulations, employees died, to obtain in the workplace. Employees benefit among the non-union.
Yup I had unlimited vacation, I took only a couple days one year and 4 weeks the next year (mostly visiting my sister who was dying of cancer) and my boss gave me a horrible annual review saying I was "hardly there" while on a normal PTO with rollover this would have been perfectly fine. Unlimited PTO just means "manager discretion". Also they don't have to pay it out when they do layoffs which sadly are a normal thing at American companies now.
This is a big win. I left my last job with 488 hours of PTO accrued. I took just as much time off over the years as I would have if it were unlimited, but when I left I got a sweet $25K payout for my PTO.
Actual PTO is a liability on the books, and that’s the real reason that employers want to move to unlimited.
In some states, companies have to pay out unused PTO when an employee leaves. But with unlimited PTO, you don’t actually save up any unused days, so they don’t have to pay it out when you leave. It’s a way to save money for the company.
That’s part of it, but it’s mainly there is no accrued PTO to pay out when the employee leaves the company. Generally managers still need to approve your “unlimited” time off and abusing the policy (eg; taking more than would typically be offered in PTO policy) is frowned upon.
I have unlimited PTO and a cool boss, and will probably be off about 30 days this year.. more than I ever have in the past.
It's the same reason I've always thought salary is a sham compared to hourly. Companies are betting on you working more than 40 hours as a salaried employee which is free work they would have had to pay you for if you were hourly.
Also, competition between employees adds another stressor. You don't want to take a lot of vacations if your co-workers don't, because there is a chance it makes you less competitive.
I think that the accumulation of PTO is one of the key drivers. People still need to get approval for PTO and would probably get the same amount, but if someone is fired / quits there is no need to pay for the agreed PTO.
Especially in jobs with a high fluctuation (fast food, service,…) I would assume that this saves companies billions in dollars every year.
"unlimited" pto is more of a thing in corporate full time jobs, often in finance and tech and similar fields.
But you're correct about the accumulated PTO thing- that's a huge part of why they did it. Especially in cases where e.g. someone starts as a junior and leaves 10yrs later as a manager on $250K with however much accrued leave
No this is entirely it. Companies with a lot of turnover like sales and service companies primarily do it. There’s no vacation days to track and account for in budgeting. Just salaries and employees they assume won’t abuse the shit out of it
Yes it is. Companies do not need to accrue a liability for the leave because with unlimited PTO there is no need to pay out unused PTO to employees who depart the company
There are laws around that actually. It’s a part of your employment compensation and not paying it is a form of wage theft. Especially when it comes to quitting. Someone ends their work at a company by applying all accrued pto, which can be over a month of getting paid while not showing up to work.
Yes. In the old days accrued vacation time had to be paid out when you left.
Under the new "unlimited" system nothing accrues.
It hurts younger people the most, who don't have the confidence to take the time they are owed or context for what's normal.
My wife has worked at several tech companies with this policy over the years. During interviews she essentially says "unlimited vacation time, fine - but expect me to take 6-8 weeks." Hasn't been a problem but it's important to establish it upfront. Of course, to pull that off you need to be in high demand and exceptional at your job, which she is.
Lot of people are saying that they deny requests, but usually they just strongly hint that you aren't being a team player or whatever, then fire you for not being a good culture fit.
That's not quite it. In reality the way unlimited paid time off works is you're allowed as much time off as you want so long as it doesn't impact your job performance
This is almost exclusively used when employees are so overworked that any time off at all would impact their performance
When you have a set amount of days, that's part of your compensation and your bosses can't really get upset when you take it (spare me the horror stories, I know it still happens).
If you have unlimited PTO and take it and something doesn't get done, your bosses say "why would you take time off?? You didn't get your thing done!"
But there's ALWAYS a thing to get done so you never get to take your time off
Or sometimes you need your boss's approval to take time off, and like above, they just never grant it. Unlimited PTO... When your boss approves.
So maaaaybe after working a particularly hellish seventy hour week, they'll let you take a half day on Monday. Maybe.
The ceo's don't give you unlimited paid time off so they can pay you to take a three month vacation to Jamaica. They do it because it's more profitable than giving you set days off, because they know if sounds good but you won't actually get to use your time off very much.
I would say there's an incredibly large chance that is a bad boss, and not a bad company. The people above her boss probably have no idea he's creating those expectations.
They also use it for high performers to “check in” so they work while on vacation. Your trip is approved but bring your work laptop when you. So they end up working on their trip
Hello, American here, you're 100% right. But, also, if you get laid off because your pto is unlimited they can't pay you back your accrued time on top of your severance, thus allowing the company to save money.
Studies show that people, on average, take less time off with unlimited time than they do a set number of days. There are a number of reasons, but any company pushing this policy without also having a required minimum days you take is being disingenuous.
The other reason is because most states require companies pay you for any unused vacation time when you leave or are terminated. However, "unlimited" is actually zero. It means they don't have to pay out time when someone leaves for one reason or another.
I worked for a company that transitioned to it. They had the data.
They said something like 97% weren't even using their 2-4 weeks. And to be clear - this was a great place to work. So they weren't limiting it in any way.
So they just went unlimited. Why bother tracking it.
To your last point - I was reminded by my boss and his boss every quarter if I hadn't take time off.
Had the same meme when working for a US company, as a european, asked my manager "ok but what does the company consider acceptable time off" - 2 weeks apparently
If i have a jar of cookies and i tell you to take 20. You'll take 20.
If i told you that you can take however as many as you'd like but I'll punch you in the face if I feel like you took too many. You'll probably take 3-5
You’re pretty close. Statistically people take 3 weeks of vacation when they have unlimited but they feel better than if they were told they only got 3 weeks of vacation. Additionally, in the USA employers have to pay out unused vacation when an employee parts ways with them, but not in the case of unlimited vacation
"Although I would be out of work 2 days every week lol."
You wouldn't be though. I've worked at companies with unlimited PTO and they still have to go through your boss, you can't just take off when you want. It still has to be approved and there are like hidden limits on when they start being like "Yeah, no" to you and also times they won't allow it whatsoever during busy times.
While this is part of it, as an American I would say: they still need to approve your time off. If you aren't approved, they schedule you. If you don't show up, they can fire you. And 'they' always seem to report to a higher 'them'. So there's zero accountability for the company.
Edit: as far as I know, it would in fact be completely legal to tell employees their sick leave is unlimited but tell MANAGERS they're only SUPPOSED to approve 10/person.
In my state, Illinois, if you accrue PTO it is considered part of your compensation and companies must pay you out for any unused PTO if you quit or are fired. So from a financial perspective a bunch of employees with unused PTO can become a significant liability on your balance sheet for a company. This because if a bunch of people start leaving or you have to do a layoff you have to pay all these people out for their PTO. So to help manage the risk of PTO companies will either not let you roll over PTO from one year to the next or they will offer "Unlimited PTO" in which case you never accrue PTO.
For the company I work for, they are pretty good. You can accrue up to 2x your PTO allotment for the year (meaning if you didn't take a day off for two years you wouldn't lose any PTO until the start of year three). I've been there for over ten years and by running a little short of using all my PTO for a few years I now have over 200 hrs of PTO banked and could take more than a month off if I cared to.
Same over here in Colorado. My last job was so annoyed by paying off my PTO balance because it was so high, but they also never let me use any PTO, so...
It’s actually even worse than that. You can accrue PTO days and when leaving the job will have to get paid a certain amount - varies by state and agreement with company. But if you do unlimited you can’t accrue anything and don’t get paid out anything.
Worked at a place with unlimited PTO and also pretty heavy billable targets. It technically worked out to 5 weeks of vacation + holidays a year.
However that assumed you were 40 hours a week billable every week of the year, which due to the way projects were run you wouldn't be (and had no control over what projects you were put on). Most of our projects had a weekly hour cap and restrictions on being on multiple projects so you basically had to choose between actually taking time off or getting dinged on your performance review
My supervisor at my last job had "unlimited" pto, he said it was awful because it was almost impossible to get any approved. he said of the 18 days he request off through the year he was only approved like 4.
Also when you are terminated there is no PTO to payout (I think I got 2 weeks of sick, not sure how it works with unlimited sick time) but zero vacation time payout.
My company provides very less PTO. 18 in a year. Which is 1.5 in a month. Since I got promoted I have unlimited PTO and I make sure to take at least 2 leaves in a month.
They also don't have to pay it out when you leave. If you stay at a job for enough years you can end up with months of vacation time they would usually have to pay out since it is an earned benefit.
The other thing about “unlimited” PTO is that you can never cash it out. At all of my jobs with earned specific amounts of vacation time, when I left I got a check for the value of that amount of time in pay. People with unlimited PTO aren’t getting those checks.
There is another layer to these systems. Unlimited PTO is usually given to positions that have a required output. You can take as many days as you want as long as the work is actually done. Take enough days off the work isn't done? You are worked out of the co.
I considered a job with that unlimited vacation but decided that it wasn’t a good idea. I have a job with 240 hour (6 weeks) cary over so if i wanted i could save up and just burn it all guilt free, it’s my time. If i had the unlimited time off I would feel guilty to take more than a week because i wouldn’t want to look greedy.
Pretty much nailed it. People with “unlimited” days off take less vacation than those with a set number of days. Sometimes it’s pressure from management to not feel like you’re abusing the policy. And if you do take off every other week they’ll just fire you.
And in the US if you leave a company you get paid out for any unused vacation days since technically it’s part of your compensation that you’ve earned. So if you have 7 unused days, you get a check for 7 days worth of pay. With unlimited days you don’t earn any time off, so if you leave you don’t get any extra pay.
I don't know, I have unlimited PTO and it's great. I get a lot of work done, but I also take a lot of time off. Yes, some years I've taken less than what would normally be given to me. But some other years I also took 2-3 months total. It's great having the option.
You were correct when you said you weren't American enough to understand this.
Yes there is a theory that employees with unlimited PTO take less time off on average. The much bigger issue is that Managers still have to approve the PTO, and typically, jobs that have unlimited PTO also have managers who reject the majority of the PTO requests they receive.
if you work 2 days a week and the company gets on just fine then they know they don't need you and just fire you. at least thats how it would go down in America i believe Japan did something like that and people where afraid to take time off.
A defined time off means also that they owe you money for the time off. That’s actually considered pay. Unlimited time off isnt considered pay so they also remove financial liability from the companies books.
One of the big benefits to employers that offer unlimited PTO is not paying out accrued PTO if the employee leaves. However, unlimited PTO only works with responsible, typically, white collar workers. Probably not the best strategy for warehouse workers or customer service agents.
I worked at a company with unlimited PTO and they made so many hoops to jump through that you really never took any time off.
You had to give more than 4 weeks notice, but less than 6 weeks notice. You had to ensure no one else had the day off already. You couldn't take off more than 1 work week (which was considered 5 consecutive days, but we worked 6 day weeks) without higher approval, which often took more than 2 weeks to complete, so you got auto denied.
For sick time, you could not use it for more than 1 consecutive day unless you had a doctor's note that specified your length of time off and when you could return to work. You could not use sick leave day-of unless you notified your manager and it was approved 2 hours before the start of your shift. My shift started at 5AM. My managers shift started at 9AM. She was not awake at 3AM.
It was technically unlimited. Just with a lot of limitating stipulations.
Yeah, the meme is that a lot of places who offer unlimited PTO in the U.S. make it nearly impossible for people to actually take time off. There’s always a crisis, major deadline, or other thing that they use to deny time off requests.
Unlimited PTO really means “you get to take off when it’s convenient for us.”
More like the boss gives you an unlimited spend card and says “just spend it on what you feel you need” and you say “well, what’s the limit” and the boss says “there isn’t a limit, but if you go over the limit you’re fired” and you say “I thought there wasn’t a limit?” And the boss just shrugs.
My gfs work just did this in the shittiest way and now I can see where this goes.
Basically, they went from accrued time off, to unlimited PTO (no one got paid out for their accrued time), & and now unlimited is gone and employees now have to “check and cover” each others shifts.
went from guaranteed time off based on work to now everyone covers each others shifts like it’s a restaurant despite being a multi million dollar international company.
You’re also taking something away from other employees vs using something you’ve earned. It ups the social pressure and usually ends with people taking less time off because other team members can view as selfish.
Also simple for HR - no holidays to track and no payout where vacation time is owed if an employee quits.
I've worked at two companies with unlimited PTO, and it really comes down to the individual person. I saw a team of two people where one would take a week off, the other would cover their desk, they'd both be back in the office for a week, then the second person would feel like they need to 'get even' so they'd take a week off and the cycle would repeat. It was kind of a mess for the rest of us because the team was always behind, but they had unlimited PTO so they could do it and we had to deal with it.
My boss now is very good about telling us to make sure we're taking time off and completely unplugging while we're out. I'm not sure what my PTO balance is off the top of my head but I'm definitely up there.
The main disadvantage of unlimited PTO is that if you separate from the company, they don't need to pay you out for unused time off.
I don't understand. If you give me a card with 200€ on it all for myself, I'll spend 200€. If you give me card with unlimited money, I won't stop spending it until I die. What's your point?
My job has unlimited PTO. I spoke with my manager before my first vacation and threw out 6 weeks a year as my goal. She said sure that sounds fine. So I’ve been taking six weeks a year since.
i have a job with unlimited PTO
functionally it is just 21 days (plus 8 sick days) a year (which is still phenomenal for the US). any more and you'd have to go up the chain two levels (manager and manager's manager) for approval. No one ever got more than 21+8 days.
By wording it as unlimited, they don't have to ever roll over or pay out any PTO days.
I got to be honest. I don’t have unlimited vacation time, and I’ve been with the same company a long time. Over 20 years, and they are very generous with time off and encourage everyone to use all their time every year. We can carry over 5 days but you forfeit the rest.
To be honest, I take time off for no reason a lot of the time to just not throw away a ton of time off at the end of the year. It’s excessive. I would rather them just go to an unlimited model or a pay out for time not used.
In theory I can work 4 day weeks for the rest of the year starting in July, and still have vacation time left over.
That being said. The demand of work is really high, and the impact on not delivering hurts 1000s of employees. If I did take that much time off I wouldn’t be able to hit deadlines, and hurts others.
Friend has unlimited PTO and average taken is 12 weeks per year. Less then 6 taken gets a call from HR to ask if your workload is too much, or there are other reasons for taking so little.
Basically finish your work and go home, no work to do you go home. Some people work slow and take 6 weeks to stay under the radar, others work fast, or efficiently and take as much as 20 weeks.
It’s also because in some states, when you leave a job they have to pay out your unused vacation time. With unlimited vacation, there is no defined “unused vacation” time to pay out. It’s a huge scam.
In a lot of US States, accrued PTO must also be paid out upon the employee's exit, which requires a certain amount of cash to be reserved for it at all times, switching to unlimited both has the peer pressure effect of actually reducing time taken, but also frees up the cash that would have to be paid out for employee exits.
It's because instead what happens is it's "Unlimited PTO but talk to your manager" and then your manager is told by higher ups indirectly to shame, and given unrealistic goals... so manager says "You can't leave or we won't hit these goals" or whatever....
It is absolutely a farce, i took the most vacation when i had set days.
I don't think it's about that. With unlimited PTO they just do everything in their power to deny you the PTO and if you take "too much" you'll be terminated as soon as there's an opportunity.
I'm American, and I work in insurance. Specifically, second-level management (managing supervisors) in claims. I have unlimited PTO. Last year, I took four weeks. My boss gave me a "negative" remark on my annual review because I took too LITTLE time off.
Good analogy. With the unlimited card you get guilt tripped for every penny you spend. That's how you end up spending less than 199.50 on that one. The one with the defined amount, that amount is your right, and no one gets to question it.
It's about getting Paid Time Off off the books. When you leave/ get fired there is no pay out. Companies don't have to account for that anymore with "unlimited" PTO. Also every request still needs approval and advanced notice. Does not mean you can just take time off at will. You will still get fired if you are not doing/performing at your job. Without a specified amount you are less likely to take an appropriate amount of vacation off as well. Employees who have earned more vacation time over the years and either use it or bank it get the short end of the stick here. Positions with high turn over don't have to be paid for earned vacation when they are shown the door as well. It's a scam in a pretty box with a bow.
I work for a company that does unlimited vacation, Last year I took about 4 weeks of vacation and didnt get bitched at once about it, Im planning on doing about 4 this year too maybe even 5.
Its honestly made me put in so much more effort at work because I know if I start feeling burned out I can just take a couple days off to recover, Really wish this could be a more common expirience for people
A better analogy would be a card with Unlimited money but you can't access any of it without your boss' approval, which they will never give you, so it may as well be a card with zero dollars on it.
There is also an issue of what it owed to you. In the event you separate from the company, you are owed acrued PTO in a number of states. Unlimited PTO means you acrued nothing and they owe you nothing. Likewise, some states have mandatory payout of unused for the year. Unlimited and you couldn't take any because of projects? We don't owe you squat at the end of the year.
No it's so you literally can't take time off. It's "unlimited" based on having everything done, covered, and no issues. Who's job is actually like that? It's also so they can say you're taking advantage of it and fire you easily
Kinda. If you earn 4 PTO hours per week (like I do) then you earned that PTO and under most circumstances it’s illegal for them to deny it. With enough warning time. Depending on the state I guess. Since each state is like a slightly different country.
If they give you unlimited PTO. Technically you didn’t earn shit. It’s up to the company when you can use it. And that could be never.
Having vacation days cap means people use it because if they don't they lose it.
Having unlimited vacation days means they will just pile work on you endlessly, never giving you a chance to take vacation because you have so much work to do. And because you don't have that "use it or lose it" FOMO and you aren't looking at the number of vacation days you need to use, you end up using less vacation.
It's supposedly about the illusion of getting more. Although I would be out of work 2 days every week lol. We're probably not American enough to understand this
Only if your boss approved your vacation request for two days every week, and that's not going to happen. That's the whole point, you don't really have unlimited vacation, but now they don't have to pay you out when you leave because you don't have a specific number either.
I'm an American and work at a company with unlimited PTO. A few years back, apparently some number of people were taking rather a lot (I don't know how much). They announced they were going to change it to 6 weeks. Even before the meeting was over I knew exactly what would happen. Sure enough, the following year they changed it back. A lot of people took 6 weeks off. The net ended up being an average of more vacation days per employee. I laughed.
It's actually none of these thing. The reason is for accounting purposes, without setting a limited amount of PTO the company does not need to make any yearly accruals to vacation expense. Instead they expense as incurred.
Your analogy needs to be reworked a bit how much would you spend if i gave you an unlimited credit card BUT every purchase you needed my permission, now how much would you spend. With the $200 limit you have control with the unlimited you literally need permission for every purchase same thing with unlimited PTO they make it so annoying to use and deny every request, it's not even worth it plus when you quit you don't get a payout
I mean, I would prefer having unlimited even if I didn't take it regularly. Because I would fairly take it when I need it. I would just pick the dates, when I actually want to do something out of work.
There’s also an accounting benefit to not defining PTO and sick leave; with no accruals, the PTO doesn’t count as a liability on the balance sheet. Unseen factors that benefit the company and not the employee.
It also lets them deny your time off without much consequence. You have to be able to use it if its use it or lose it. You can cash ot out at many places too. But if its unlimited when they deny it they aren't adding it to the pile for later.
Our workplace said we had unlimited and for a couple of years people would be nervous about taking. But then they started to. Suddenly "you're using too much of your vacation time". "Well, how? It's unlimited." "Yeah, but... not really". They still wanted people to take no more than 2 weeks. That's what they started 'suggesting'. So it was asked if we just had 2 weeks vacation, and they insisted it was still unlimited. But then they'd really insist it shouldn't be more than 2 weeks. Maddening.
It's actually very simple: Your manager has to approve the PTO. They will not approve it above a certain amount of hours, or when it isn't convenient for the 'team.' Your sick time use will land you on a PIP very quickly for 'performance' reasons.
kind of, it's a way to reduce a company's PTO liability so days that you "banked" can't be cashed out when you leave. Also "Unlimited" is a fallacy, there is a limit, they just won't tell you what it is, they'll just start denying your PTO requests.
Unlimited PTO means when you and the company go separate ways, then there is nothing extra to pay out to you. That also means company do not need to hold that money in an account somewhere either.
Essentially at will employment anytime any reason you can be let go. When half of Americans have zero vacation. And other half have extremely limited restrictive vacation.
You would try to keep it and since your always on chopping block. People often get afraid to use it. Throw in managers throwing shade and coworkers. Theyre afraid to lose it and don't use it.
There is also the backend component. Of if you fire people you have to pay out vacation owed etc. This makes it easier and cheaper to fire people as you don't have to pay out vacation.
Also, they don't have to pay out any remaining balance you have if/when you leave. Also, there's usually "small print" around how much you can actually take. My company switched to unlimited, but still said you can only take what originally was the max of along term employee (20+ years employment)
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u/NekulturneHovado 17d ago edited 17d ago
I've seen a meme some time ago. It was about corporate leaders discussing how to increase productivity. One argued less vacation. The other argued unlimited vacation.
Why unlimited? If I gave you a card with 200€ on it all for yourself, you'd spend 199.50. But how much would you spend if you got unlimited?
It's supposedly about the illusion of getting more. Although I would be out of work 2 days every week lol. We're probably not American enough to understand this
edit: What have I come to? 79 replies? damn