Commentary

Time To Eliminate Vacation Policies?

by Dave Morgan , Featured Contributor, November 19, 2009

Should paid vacation policies go the way of the punch clock in today's companies? There was quite a stir a few months ago when an internal presentation about how Netflix manages its internal culture was leaked across the Web. Among Netflix's more unusual policies was that it does not limit the number of vacation days that its salaried employees (those not covered by wage & hour rules) can take. Yes. It's true. Netflix lets its salaried employees take vacation days when they want.

Here is the Netflix vacation policy:

Netflix Vacation Policy and Tracking: "there is no policy or tracking"

How is this possible? How can a serious company let people take as many vacation days as they want? How? Apparently, Netflix trusts its people to do the right thing. Netflix has decided to focus on what people get done, not how many hours or days they work.

My company has been adding a number of folks lately, so the issue of vacation policy has been top of mind and has been the subject of a number of conversations. The more we talk about it internally, the more I like the Netflix approach. Here 's why:

Reflects reality. In most of today's more nimble and fast-moving companies, people take vacation when they can and when they need it. In the end, it doesn't really matter much how many days were allotted. In the vast majority of my experience over the past 15 years running digital start-ups, our people took too little vacation, not too much.

Reinforces focus on performance and results. We tell people that performance and results matter most, not process. This reinforces it.

Further empowers employees. This policy puts your money where your mouth is for empowering employees. If employees are truly in charge and at the center of the enterprise, giving them control over their vacation days truly gives them more meaningful control over their working conditions.

Differentiated tone and culture of company. We are all trying to recruit and retain the best and brightest. Adopting policies like these can be critical in differentiating a company. Further, it encourages folks to question other outdated and potentially irrelevant policies -- also a healthy exercise.

What do you think? Has Netflix gone off the deep end by eliminating vacation policies or tracking? Would it be suicide for other companies to follow? What should we do at Simulmedia?

commentary

20 comments about " Time To Eliminate Vacation Policies?".

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Ron Shevlin from Aite Group, November 19, 2009 at 4:11 p.m.
Here's one benefit of the policy to Netflix: When someone leaves the firm, Netflix doesn't owe them accrued vacation time.
Reply

Monica Bower from TERiX Computer Service, November 19, 2009 at 4:12 p.m.

Wow - I love it. it also puts the pressure back on management to ensure that you're giving salaried subordinates enough to keep them busy but not so much that you make them crazy. If you take seven weeks of vacation but the work is all done, that's my fault for underutilizing your skills. If your work isn't done and you're just abusing the policy, it shows on your review and you earn the boot for your lousy work, not for taking too much vacation.

Stanford Crane from NewGuard Entertainment Corp, November 19, 2009 at 4:36 p.m.

Everything old is new again. This was advocated by Robert Townsend in his excellent book Up The Organization, which dates back to the 1960's.

George Michie from Rimm-Kaufman Group, November 19, 2009 at 4:38 p.m.

We could probably do this at RKG. Our folks tend to work too hard, not too little. How do they handle long-term disability issues, child-birth, etc?

Rochelle Fainstein from Sterling Brands, November 19, 2009 at 4:45 p.m.

I think this is a wonderful idea. I think at a certain level, people should be judged by the quality of work and amount of work produced, not by the amount of actual physical time in the office. If you're good, you're good. Harkens way back to my favorite college professors- who wouldn't penalize you for your absences, but judged you on the work you turned in at the end of the week, semester. I did my best work in that environment- it's all about how much structure you need to produce results.

NEAT

Alison Kosakowski from MyWebGrocer, November 19, 2009 at 4:45 p.m.

Last spring I took a trip to Venice and a fellow traveler sent his wife and kids on a gondolla ride so he could catch up on his emails for a few minutes. It was a sad comment on the state of American work-life balance.

Our concept of "vacation" is so backward these days anyway. As folks rush to "use" the last of the days before the year ends, I can't help but think how arbitrary these rules can be.

Bravo Netflix for having faith in its workforce!

Stacy Heatherington from National League for Nursing, November 19, 2009 at 4:46 p.m.

I agree whole-heartedly with this approach. If a company truly recruits the 'best and the brightest', those employees are also dedicated and hold a strong work ethic. Mutual respect between employee-company. Plus the potential of looking like a slacker to other co-workers is another caveat.

David Carlick from Carlick, November 19, 2009 at 4:48 p.m.

Technology puts a little work into every day of your vacation. So you have to put a little vacation into every day of your work.

Dana Marsh, November 19, 2009 at 4:54 p.m.

My former employer had an open leave policy - and no one took advantage. It was truly an environment in which all employees were treated as grown ups who were able to (and expected to) handle their business. I probably took fewer vacation days in those 4 years than I ever have in my career.

Paula Lynn from Who Else Unlimited, November 19, 2009 at 4:58 p.m.

It may work for Netflix or for your company, but overall a company needs more control with who's going to be where, when and for how long. Most jobs cannot be done via computer. Think of the medical field or retail or the trades for just a few examples. As far as honesty, just what a company needs - more animosity and it's just not worth the risk. George M also has a point. Many companies, again, do not offer medical coverage (or pared down with higher employee contribution) or long term disability, all very, very expensive. And that accrued vacation time, there are limits with take it or leave it behind policies.

Doug Frechtling from George Washington University, November 19, 2009 at 5:38 p.m.

This seems fine for a company that doesn't have to deal with those pesky customers demanding service.
I don't see how it can work for organizations dealing directly with customers on a daily basis, such as hotels, restaurants, educational institutions, health care providers, police, fire protection, insurance, public transportation.
What do you say to the customer, "Sorry but we can't serve you today, everyone decided to take a vacation day."?

Jill Simon from TurnHere Inc., November 19, 2009 at 6:17 p.m.

I worked in Europe and the policy of my employer was brilliant. You have 25 personal days per year. No need to label them sick, vacation, religious holiday, or anything else. These are your days to do with as you please. So if you needed a "duvet day" (a.k.a. hide under the covers day) that was cool. No explanation needed. This policy cut a lot of the BS found in US companies.

Michael Senno from New York University, November 19, 2009 at 10:45 p.m.

The other side of the debate is protecting employees and making sure they take some vacation time to prevent burnout and expand their horizons. WHile it sounds enticing, it can create an implicit pressure to be in the office more than usual.

David Hallerman from eMarketer, November 20, 2009 at 10:46 a.m.

Michael Senno writes: "The other side of the debate is protecting employees and making sure they take some vacation time to prevent burnout and expand their horizons. WHile it sounds enticing, it can create an implicit pressure to be in the office more than usual."

Agreed.

So perhaps there's a place in-between: No limits on vacation time, but require employees to take a minimum amount.

Mike Azzara from Content Marketing Partners, November 20, 2009 at 2:52 p.m.

In the end, it's all about corporate culture. The 'Netflix rule' will work great or kill people depending on the corporate cultural context in which it is pursued. Will they reward workers who produce fantastic results AND take off for the month of July?

Over the course of 30 years, one thing I learned about myself is that I'm most productive in sustained bursts of high intensity, followed by a day or two of recovery during which my mind often turned numb. In the 80s and 90s it wasn't impossible to find a friend and enjoy a "play day." Try that now!

Stephen Schwartz from Vanguard Systems Inc., November 20, 2009 at 7:20 p.m.

Love it. Keep it up, let's get human.

Dave Morgan from Simulmedia, November 21, 2009 at 6:14 a.m.

We've decided. No more vacation policy or tracking at Simulmedia! Thanks everyone for your help here.

Dana Webster from ParaPRO, November 24, 2009 at 3:26 p.m.

I'm one of those who never takes all their personal time. I've only been on 2 vacations in my life, and the last one was 5 years ago.
I would probably still be a work-a-holic. In this economy, I think a lot of employees are scared to appear lazy or uncommitted to the company by taking their accrued time off.

Theresa Brigandi from Defenshield Inc, January 4, 2010 at 10:45 p.m.

This is the way we do it at my company as well. We have a staff of 10, including remote employees, and have no abuses. The empowerment and sense of responsibility that it instills is invaluable. I do need to state that most of us have an entrepreneurial background - none of us are there for the "job".

Jerry Foster from Energraphics, January 7, 2010 at 6:39 a.m.

Maybe the tourist in Venice sent his wife on a gondola ride so he could check his emails from an Italian pen pal. :-)

Seriously, I absolutely love the feeling of being on vacation and checking my email. It has the effect of making one realize that one could MOVE to the spot where one is vacationing and work full time from there. This feeling enhances the freedom aspect of the vacation and, thus, makes the vacation more enjoyable.

The opposite - *not* working on vacation enhances the feeling that "I am only able to be here for a short time no matter how much I may want to stay". When you don't check your email, your brain feels tied to the computer back in the far away office that you have to return to.

I am now at a resort working full-time via the Internet. I didn't bother to go anywhere for vacation because there is no place on Earth I would rather be than where I am.