Tips for navigating the poorly charted waters of “Unlimited” PTO
These days, startups (and companies trying to be startups) are slinging around a lot of trendy perks including everything from cereal bars to gym memberships to nap rooms. The promise of unlimited PTO is often tossed into the mix as well. Most homo sapiens come pre-programmed with instinctual knowledge of what to do with a cereal bar; however, while infinite vacation seems incredible in theory, it can be difficult as an employee to squeeze maximum value out of it.
There is a lot of content out there weighing the pros and cons of unlimited PTO, but most run-of-the-mill programmers, designers, product owners, managers, and so on never actually weigh in on how the vacation policy is structured. Once the decision is made, employees are often left to fend for themselves.
Maybe you have recently accepted or are considering accepting a position at a software shop with one of them swanky vacation perks. Perhaps your company just started offering unlimited days off. Whatever your situation, if such a plan is new for you, “unlimited” may also mean “intimidating.”
I have worked for a few companies now that have offered unlimited time off and here are a few tips that I have picked up along the way to make the most of it.
1. Budget and track PTO on your own
To successfully leverage an unlimited time off policy, you have to remove the ambiguity of “unlimited.” When BaseCamp experimented with unlimited time off, they observed that anxiety increased because no one knew what “unlimited” meant. (If you want to know more about their story, read It Doesn’t Have To Be Crazy At Work.) If you want the flexibility without the stress, pick a number on your own and then track how much time you are spending out of the office.
Whenever I have had the privilege of unlimited PTO, I always keep a spreadsheet where I log my time away. Being the data addict that I am, I also calculate various metrics like the average time between time off, rolling average per year, and other stats of varying levels of value. As a bonus, looking at a spreadsheet is a slightly less eye-gouging experience than looking at an HR portal that stole its design cues from the late 90s.
But this all still doesn’t answer the original question. If you are supposed to pick your own number, what should that number be?
Let’s take the concept of unlimited to the extreme. What if everyone took 364 days of vacation per year? Obviously, that isn’t going to work. Consider how businesses work: they provide value, customers provide money. At the same time, employees provide value for the business and the business reciprocates with paychecks. Stated differently, if employees don’t provide value to the business, then the business can’t provide value to the customers, and everyone loses. You can’t provide value if you are on vacation 100% of the time. Thus, “unlimited” doesn’t equal “infinite.”
Let’s go to the other extreme. What if no one ever took any time off? The need for rest is inherent to humanity. This is why we sleep, have weekends, daydream, talk about non-work things at work, and have periods of time between being “in the zone.” Oh, and why we need to take time off. Always being pegged at the redline leads to burn out. Thus, “unlimited” doesn’t equal “nonexistent.”
So, then, you need to pick a number between 0 and 365 days per year. 👍
OK, that range isn’t super helpful, so let’s look at some real data to help us make an informed decision. To get us started, here is a report by the Bureau of Labor Statistics from 2017.
From the report: “On average, workers received 10 paid vacation days after 1 year of service. The number of paid vacation days increases slightly as tenure with the current employer increases. After 5 years, workers received 15 paid days on average. They received an average of 17 days after 10 years and 20 days after 20 years.”
These numbers cover a lot of industries, not just software. The after average tenure for a software company is less than half of what you could expect from a “non-tech” company. This makes it a little unfair for a developer with skills in high demand. In fact, one of the reasons that companies offer unlimited PTO is to be competitive in markets with low unemployment and high-value candidates.
Check out this report of software companies from the Bay area.
Simply put, developers move around a lot. For this reason, I generally budget my PTO based on my years in the industry, not just years at a company. I usually go a bit light the first year, but then start budgeting based on industry experience.
So “unlimited” means that the company doesn’t set a limit; however, from a practical sense, there is always a number. You have the privilege of setting it for yourself. Poke around and do some research. Get to know what industry trends are both in the US and in the global industry at large. Budgeting time this way takes a bit of practice, but the rewards when done well are worth it.
2. Take advantage of “fungible time”
The concept of the 8 hour work day is new, relatively speaking. For millennia, we humans have been doing work. Think for a moment about a self-employed hunter-gatherer, not a cell phone in sight, just livin’ in the moment. The work day is over when the right amount of food has been hunted and gathered.
One thing led to another, and in the late 19th century, the US began to standardize on an 8 hour work day with other parts of the world doing so slightly before or after that.
At the core of all such labor laws is the goal of protecting the worker, which I think is fantastic. But as any software developer or other “thought worker” knows, creativity isn’t limited to an 8-hour segment of the day. Some of my best breakthroughs have happened late at night, while driving, in the shower, or even literally while dreaming. This doesn’t mean that I’m amazing, it just means I’m normal.
Depending on how your HR department has written your vacation policy, “unlimited” time off can also translate to “fungible time”. If you budget yourself 4 weeks off for the year, that means that you will work a rolling average of 8 hours per day for 48 weeks throughout the year. While it is a noble goal to never stay late or wake up at 3 am to put out a server fire, life is full of imperfections. Fungible time give the employee the freedom to put in a crazy week during a burst of creativity or peak seasonal activity, and then become scarce for a few days.
Over the span of a few weeks, you should keep your rolling average at roughly 8 hours per day. If you work more, you get burned out. If you work less, you should be counting days as “vacation” days. On my spreadsheet, I log “negative” time off for weeks where I spend extra time at the office or stay up late hammering out a work project. That makes it easy to determine if and when I should take a calculated half-day or two when reasonable.
One last thing to note is to move work forward, not backward. In other words, don’t skimp out on work while making a mental note to work harder next week. This only adds unnecessary pressure. Don’t borrow time from the future, enjoy spending time from the past.
3. You have to understand business needs and priorities
Everything up to this point has been relatively agnostic of context. But the reality is that employees are part of a larger team with its own set of needs and priorities. “Unlimited” time off isn’t a license to bail when company deadlines start approaching.
Part of the value of flexible vacation policies is how they motivate employees to understand how their day-to-day work fits in with the business as a whole. Take advantage of this. Get to know people outside of your department. Understand what their challenges are. I was talking with a coworker from sales just the other day. As we near the end of the year, the technology side of the house is focused on keeping all systems purring along as usual as various members of the team take well deserved time off. I never really thought about the challenges that sales faces while trying to close deals while their prospects take well deserved time off.
If you understand how your company works, it becomes a lot easier to know when you are genuinely needed and when you can slip away. A side effect of that knowledge is that you not only gain a better understanding of when you should be working but what you should be doing.
Knowing what makes the company tick is always a good thing, but how does one figure that out. If you want to pop the hood and see how a company works, just follow the money. Who are the customers? Why do they buy from us? What products are they asking for? Why do they leave us for someone else? How are we investing cash inside the company? What infrastructure are we buying? What services do we purchase to make the company work? Who invests in our company and why? These are all questions that developers don’t naturally ask, but they pull back the fog of war that often covers business needs and priorities.
4. Think about it as “Employee owned” rather than “unlimited”
I think there is an annual prize for the most oversold perks. For example, one place I worked boasted a “kitchen stocked with snacks!” which turned out to be a crusty little fridge with a half-full tub of freezer-burned ice cream. Or “unlimited free coffee!” which was just the world’s OKest Keurig.
“Unlimited” is a great way to trump up a flexible vacation plan in a way that appeals to potential candidates. All things being equal if I had to choose between an “unlimited cereal bar” and a “competitive cereal bar” I would definitely choose the unlimited one hands down even though I, like most people, can’t actually consume unlimited cereal.
At this point in my life, I have moved out, grown up, and in general know how to live life without supervision. When offered unlimited cereal, I don’t gorge myself until I’m sick. Maybe back in junior high, I would have eaten myself into a Fruit Loop™ coma, but those days are behind me.
The same principles that apply to prudent consumption of snacks also apply to reasonable consumption of time off. You don’t need to be told how much “unlimited” coffee you can consume throughout the day, why should you need to be told how much PTO is appropriate? Personal needs are going to be different for everyone, and it would be weird if the company set hard and fast limits. It’s something that the individual employee needs to be able to own and self-manage.
If your employer has entrusted you with the privilege of unlimited vacation, don’t break their trust. If you have never had to manage your own PTO limits before, this may be difficult. If so, there is no shame in asking for help. Talk to a coworker or manager about what they do and start there. Then feel free to adapt as you get into the groove.
5. Use It!
Lastly, it turns out that employees with unlimited paid time off actually spend more time at the office that those with traditional PTO plans. One theory is that employees are afraid to step over the line, but don’t always know where that line is. The result is being overly cautious and taking less time off.
To combat this, as I mentioned before, set a PTO budget for yourself, and then actually remember to take time off! Sit down at the beginning of the year or quarter or whatever and pencil some dates on your calendar. I try to be home with my family for the week between Christmas and New Year’s Day. We also like to get away for a week or two in the summer. The rest is days off here and there as life happens.
If you don’t feel like you can get away without the world falling apart, then you need to reduce your bus factor. But, don’t wait until you’re burned out to start planning how you are going to take a break.
Invest time to share your knowledge amongst your team. Part of this is learning how to write good documentation. Sharing your expertise in written form keeps others from taking a direct dependency on you and your brain. When you’re not the only one who knows how to restart that one server without blowing up everything, then you feel a lot more comfortable getting away for a week or so.
For senior developers, learn to develop more than code. As you become a more significant influence within your team, the value you add comes less from your own abilities and more from how you enable others. Helping others understand how to do your job doesn’t make you obsolete, it makes you invaluable. And it lets you escape when you need to.
This post isn’t intended to be a substitute for common sense or understanding your own company’s vacation policy. If you have questions or concerns, please talk to someone on your HR team.
I enjoy being able to play a small part in helping developers and businesses treat each other well, and I hope that you found this information to be useful. If you have seen any tips or tricks for getting the most out of time away from the office, I’d love to hear about them. And as always, if you enjoyed this article, please feel free to give it a 👏 or two!