Unlimited Paid Time Off ("PTO") and Sick Time: cui bono and how does it work?

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synthfan23
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Unlimited Paid Time Off ("PTO") and Sick Time: cui bono and how does it work?

Post by synthfan23 »

(Taking the time I feel is required such that the discussion is both optimally productive / edifying as well as civil).

I wasn't a fan of Paid Time Off v1.0 (in the mid-90s, many corporations combined then separate banks of Vacation Time and Sick Time into a single pool, touting this as a terrific benefit for employees.

When an HR rep presented this to my team I raised my hand, called her out on it, and confirmed what I'd already intuited--that PTO was more of a cost-savings strategy for my employer than a net benefit to employees.

I later learned I was right.

In my specific work place--just a single implementation--the total number of "PTO" banked hours would now be less than the number of hours I would have earned had the Vacation and Sick time been kept separate. I've had health issues and the misfortune of actually having to use a lot of sick time. I know there is abuse. But that ought, IMHO, be addressed on a case-by-case basis.

If you have been healthy and not had to use a lot of sick time then I'm genuinely happy for you.

Now I hear companies are offering Unlimited PTO--and naturally, I became suspicious. Which companies have such a benefit that people can actually use without:

* Becoming a pariah
* Missing out on career advancement opportunities
* Returning to a pile of work that may take months to dig oneself out of

And which companies offering Unlimited PTO (I'm suspicious of Unlimited Anything; especially when it comes to mobile phone plans):

* Use it for "Work Life Integration" -- coded language for marking a work place so appealing that it incents you to spend more time at work than with your family or on your avocations.

Please disabuse me of any mistaken notions I may have expressed about Unlimited PTO and Unlimited Sick Time. Honestly? I'd be delighted to "believe" in both--if that makes any sense. That it's a net benefit to most employees; and by most, I don't mean just people 30 or under. But for employees of all ages and family situations (single or married with 6 kids; healthy parents or sick parents one has to be a caregiver for). You get the idea.
Last edited by synthfan23 on Fri Aug 09, 2019 12:16 pm, edited 10 times in total.
HawkeyePierce
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by HawkeyePierce »

I don’t have any experience with those two companies but my employer offers unlimited PTO. Just how unlimited is highly dependent on your org and manager.

We have thousands of employees so it’s impossible to generalize. In my case it’s been great. I take 7-8 weeks a year and haven’t gotten any pushback nor has it affected my advancement. We’re pretty good about keeping work spread out so it’s never taken me more than a day to get back up to speed.

I’m currently on a five month unpaid leave and it only took me a couple days to get it approved.
panhead
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by panhead »

You're post is a little confusing but if you are asking about why an employer would offer "unlimited PTO" and what exactly that means, I can comment on that. At least in the US, many people do not use the vacation that they have. This creates a liability (or whatever the correct term is) on the books for the company as the balance is owed to the employees, and this directly effects the bottom line. Unlimited PTO was used (in my opinion) to remove this liability. Employees have "unlimited PTO" so they don't accrue any PTO time at all, thus it doesn't appear anywhere as a liability. When I've been in companies that adopted this, they made employees take all outstanding "original" vacation time by a certain date or be paid out on it.

Oh, and no, of course it's not unlimited, so yes, it was absolutely created for the benefit of the company and not the employee. Also note, since you don't accrue anything anymore, you are in a sort of a use it or lose it situation. My approach to this, which hopefully makes this thread actionable, has been to add anther week of vacation to what I normally would have accrued and try to take it all in the current and each subsequent year. This gives me some payback for what the company benefits from this configuration. Of course, your manager has to approve it sooooo....
dcabler
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by dcabler »

I'm in an industry with historically frequent layoffs. I guess with unlimited vacation, the company would not have to pay accrued vacation time for severed employees.
I've worked for several companies that allow vacation cash-out. Works reasonably well for those employees who seldom take all of their vacation time. Details are usually that one can only cash out an equivalent amount as is being actually taken for vacation. In other words, if taking 1 week vacation, one can also simultaneously cash out up to 1 week. Seems to have a benefit for both the employer and employee since the employer gets more vacation time off the books and the employee who seldom takes all of his vacation has a method to help fund his vacation, should he choose to.
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by bluebolt »

Unlimited PTO is a policy. How it's implemented depends on the corporate culture and your manager. I've seen it implemented in a way that gives employees lots of flexibility and in a way where it's not that different from a fixed time-off policy.

Most employees are responsible with the policy and some employees try to take advantage. I'm sure the ones who tried to take advantage felt wronged by their manager when their requests were denied after they'd taken 30 days in 6 months.
Last edited by bluebolt on Fri Aug 09, 2019 8:28 am, edited 1 time in total.
TigerNest
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by TigerNest »

I consider "unlimited PTO" to be a negative in a career search, and would try to avoid a place that offers it.

I'm hoping it's a fad that dies off, but there's a lot of cost savings to companies that offer it since they don't have to accrue/pay out vacation time anymore, so I expect to see more of it in the future.
Pghbuckeye
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by Pghbuckeye »

I agree with most of the comments so far about the reason for unlimited PTO existing. When it was first rolled out at my company, there was a lot of noise from people who had been there a long time and had leveled up their yearly PTO allowances. For someone that had just crossed the 10 year mark and earned that 4th week of vacation, it was frustrating that someone who was brand new just automatically got whatever.

That all subsided quickly and now it feels like most people are pretty OK with it. Its up to managers discretion and its obvious to spot the people who are trying to take advantage. The only area that unlimited PTO has opened up is people attempting to use it for parental leave of sorts, which seems to be allowed inconsistently.

Nonetheless, unlimited does help the administrative burden of managing who has what days and for a seasoned team, gives flexibility to let people take what they need.
Jayhawk11
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by Jayhawk11 »

Unlimited PTO CAN be a scam (and often is!).

I worked for a Biglaw firm that had offices all over the country, and went to an "unlimited" PTO model. Of course, no one could take a lot of PTO anyway due to client demands and the up-or-out nature of the firm, so I'd find it highly unlikely it increased the amount of time people took.

However, several states (including a few in which my firm had an office) require that an employee be paid out for accrued but unused PTO upon separation. By going to "unlimited" they didn't have to pay out anything (no real "accrual") which saved them tens of thousands of dollars every time there was a separation.

Of course in states where your PTO is not required to be paid out, it made no real difference and, I suppose, for a few people, made it easier to not have to eye-ball how much time they were taking. So it wasn't a net negative for everyone.
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by LadyGeek »

To help with the acronym, PTO == Paid Time Off.

To keep the discussion actionable, the OP is asking for his own situation.

Please stay on-topic and state your concerns in a civil, factual, manner. General rants, i.e. "it's a scam", are off-topic.

(This thread was temporarily removed for moderator review.)
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by new2bogle »

HawkeyePierce wrote: Fri Aug 09, 2019 6:36 am I don’t have any experience with those two companies but my employer offers unlimited PTO. Just how unlimited is highly dependent on your org and manager.

We have thousands of employees so it’s impossible to generalize. In my case it’s been great. I take 7-8 weeks a year and haven’t gotten any pushback nor has it affected my advancement. We’re pretty good about keeping work spread out so it’s never taken me more than a day to get back up to speed.

I’m currently on a five month unpaid leave and it only took me a couple days to get it approved.
My MegaCorp also has unlimited vacation and my experience is much like HawkeyePierce. In the trailing 1 year, I've taken 9 weeks off. One of my coworkers has taken none (which interestingly was mentioned just yesterday which is how I know - he's planning a vacation now).

I strongly agree that it is entirely dependent on your direct manager and your org.
rj342
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by rj342 »

I think my reply was eaten when mod yanked the post temporarily. (or I just didn't hit the second Submit :oops: )

I interviewed about a year ago for a job bragging about unlimited PTO and work-life integration (vs "balance").

Made me uncomfortable, as of course there is a practical limit to what you can take without being considered a slacker, but that amount is NOT defined. So that was my concern too, did people actually take no more than "normal", or even less, because afraid to cross that invisible line? Since there is no safe floor for a default amount to take, the workaholics could make people paranoid about it.
In my ideal situation, I would like another week or two more than typical -- and would be willing to trade some salary for that life flexibility --- but that did not seem to be what they were doing. When I tried to ask them about it, got some hand-wavy answers about a reasonable amount to take - "as long as your overall output is good enough". IOW taking 'extra' time wo problems seemed to be contingent on you informally working extra around the days off to keep up. Basically a sort of reverse comp time, so really not necessarily more time off than normal in reality.

Also, in conjunction with that, the warm n fuzzy talk about work life integration instead of balance seemed to be more about a loss of boundaries, which apparently are very important when working remote, from home.

In other words I have no good answer, and think you are right to be cautious.

P.S. I'm jealous of the poster up above with the unpaid leave option wo prejudice. It also seems like none of this is possible (in reality, not nice sounding fiction) in a small company.
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by multiham »

I'm going to start off by saying I'm cynical about anything that seems too good to be true.

I work at a megacorp. It is very rare when someone takes off more than 1 week at a time. I have heard comments from management and other employees about "How can anyone take off more than 1 week at a time. They must not be adding value or be critical to our success". I can't imaging what the comments would be if someone were to take off 9 or 10 weeks per year. I think this could really hurt the culture of the company.

Now, if there were no behind your back talking AND I was judged on what I delivered (not how long I worked), I would love this system. Thirty years at this company has taught me that people will always talk behind your back about your value or how you can take off so much time.
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by unclescrooge »

TigerNest wrote: Fri Aug 09, 2019 8:22 am I consider "unlimited PTO" to be a negative in a career search, and would try to avoid a place that offers it.

I'm hoping it's a fad that dies off, but there's a lot of cost savings to companies that offer it since they don't have to accrue/pay out vacation time anymore, so I expect to see more of it in the future.
+1

Although I'm happily maximizing my unlimited PTO at work. So far this year, I've taken off 16 work days and plan on taking off a few more, plus the week of Christmas. I think I took off 25 days last year.
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synthfan23
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by synthfan23 »

My apologies for starting things off on the wrong foot. Edited title and content of kick-off post to encourage civil discussion about a vital topic. In case the thread gets too heated in the opinion of the moderator, please, someone, tell me how I may configure my account such that I will automatically be e-mailed all replies to my threads. Especially with this one, I want to hear all opinions. Clearly I have strong opinions of my own about the subject. And am genuinely curious about these new "unlimited" implementations of both Vacation Time, Sick Time, and Paid Time off.
Aku09
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Re: Unlimited Paid Time Off ("PTO") and Sick Time: cui bono and how does it work?

Post by Aku09 »

I agree that unlimited PTO sounds great, but for me personally I would always feel judged on the amount of time I take off and would then take less than I otherwise would have. I’m guessing that is what these corporations are banking on.

I work in healthcare and unlimited PTO would not be practical here. Although I get 8 weeks of vacation a year and I am very happy for that.
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Re: Unlimited Paid Time Off ("PTO") and Sick Time: cui bono and how does it work?

Post by fourwheelcycle »

For three years, early in my career, I had an academic job where there were no sick day or vacation rules - none. My department chair said I, and others in our department, could take off as many days as we wished, with no advance review or approval, for any purpose, so long as we were able to complete our job-related obligations. I guess that would be "real" unlimited paid time off.

After three years I switched to another employer, in the same town, were I had traditional vacation and sick day limits, which accrued if I did not use them. However, I still did not need any advance review or approval for my vacation time, although I used good judgement and alerted my boss if I was going to miss an important meeting, etc. At some point in my career (I'm now retired) my employer shifted to a combined vacation and sick day limit, which also accrued. When I finally retired I had thirty days of accrued time and I was able to receive a full month's pay between the date I stopped working and my formal retirement date.
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Re: Unlimited Paid Time Off ("PTO") and Sick Time: cui bono and how does it work?

Post by ohai »

My wife worked in a law firm with "unlimited" PTO. In reality, you are still tied to your productivity - and in this case, billable hours. So, in reality, the unlimited PTO doesn't mean you have more time off.
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Re: Unlimited Paid Time Off ("PTO") and Sick Time: cui bono and how does it work?

Post by rascott »

I concur that unlimited PTO is just a way for a firm to remove liability for built up PTO balances.

I maintain roughly 6 weeks of PTO (max carryover) that would be legally owed to me regardless of layoff/resigning....And many fellow employees do as well. That going away would be like losing an extra unemployment/disability benefit.
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Re: Unlimited PTO, for employees, is an HR con / scam / evil plan to "tether" employees to a workplace? HubSpot? SAS?

Post by LadyGeek »

synthfan23 wrote: Fri Aug 09, 2019 12:05 pm My apologies for starting things off on the wrong foot. Edited title and content of kick-off post to encourage civil discussion about a vital topic. In case the thread gets too heated in the opinion of the moderator, please, someone, tell me how I may configure my account such that I will automatically be e-mailed all replies to my threads. Especially with this one, I want to hear all opinions. Clearly I have strong opinions of my own about the subject. And am genuinely curious about these new "unlimited" implementations of both Vacation Time, Sick Time, and Paid Time off.
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Re: Unlimited Paid Time Off ("PTO") and Sick Time: cui bono and how does it work?

Post by JuniorBH »

ohai wrote: Fri Aug 09, 2019 1:13 pm My wife worked in a law firm with "unlimited" PTO. In reality, you are still tied to your productivity - and in this case, billable hours. So, in reality, the unlimited PTO doesn't mean you have more time off.
I have a similar situation in a consulting firm; I have billable hours and revenue generation goals I need to hit. So, the unlimited PTO sounds nice, but the goals are lofty enough that I can't start taking 10weeks of vacation a year and still meet them.

Unlimited PTO is certainly in the companies benefit; my previous job had 6 weeks of vacation and I got a very large PTO payout when I left. It was basically a "leave" bonus and it's obviously not in the Company's interest to write me a check when I'm done working for them, though I suppose you could argue it was a payout on a benefit I had chosen not to use.
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Re: Unlimited Paid Time Off ("PTO") and Sick Time: cui bono and how does it work?

Post by aj76er »

In my experience, the more senior folks who understood the old rules of PTO ensured they took the proper time every year. The younger, less experienced workers never took any vacations and that becomes the new normal for them (as they don’t know anything different).

Personally I think the policy of “unlimited” vacation is wrong as it really encourages less vacation time overall, and at very least ensures an unequal treatment across a company (depending on your manager and/or group). I wouldn’t be surprised if it leads to class action lawsuits in the future.
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Re: Unlimited Paid Time Off ("PTO") and Sick Time: cui bono and how does it work?

Post by Broken Man 1999 »

The skeptic in me wonders if upper management sees PTO in excess of the old vacation earned amounts and wonders, "gee, department A could get by with one less person."

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