Unlimited paid holiday allowance sounds appealing but it can be difficult to implement.
Unlimited holiday allowance is becoming an increasingly popular benefit. Such policies are particularly popular with American tech businesses such as Netflix, LinkedIn, and the like. In an increasingly competitive market where businesses are battling to attract talented employees, unlimited holiday allowance is seen by many potential employees as an incredibly attractive benefit.
On the face of it, allowing staff the freedom and flexibility to take time off as they please certainly gives your business an edge over rivals who don’t offer such a benefit.
From your team’s perspective, they can work and play as they want, and this can make for a happier and more productive workforce. However, implementing an unlimited holiday allowance policy is harder than it seems. People can be bad at taking holiday and may be reluctant to do handovers and pass responsibility for deadlines over to others. Instead, they may choose to just keep working. Some staff may become anxious about being seen to take too much holiday and may end up taking less as a result.
In an environment that has set objectives and performance metrics, it can be hard to get people to take time off. With a fixed holiday allowance, you can encourage them to take say 25- or 30-days holiday each year. If holiday is unlimited and there is no clear expectation, management can struggle to get people to take holiday. If holiday allowance is open and completely flexible, some employees may abuse the system and leave other colleagues to pick up the slack which can lead to tension between colleagues.
If team members regularly take extended holiday, they could end up paying the price when they return to the office. They may have to work day and night to catch up. This could have a negative effect on their home life and lead to stress or burnout. Due to the ongoing pandemic, many businesses are now experimenting with flexible working arrangements in order to find what works best for their team. As such, the limitations of unlimited holiday policies could soon be more widely tested.