Ed

Last year I eliminated our PTO policy. I called it "unlimited." The board loved it. HR loved it. Finance really loved it. Let me explain why Finance loved it. Under the old policy, employees accrued 18 days per year. Unused days carried over. When employees quit, we owed them money. Cash. For days they earned but didn't take. That's a liability. On the books. $4.7 million in accrued PTO across 2,300 employees. I made it disappear. With one policy change. "Unlimited PTO." You can't accrue what's infinite. You can't owe what was never counted. The liability vanished. $4.7 million. Gone. The CFO sent me a bottle of wine. I told employees it was about "trust and flexibility." It was about the balance sheet. But "balance sheet optimization" doesn't fit on a careers page. "Unlimited PTO" does. We updated the job postings. Applications increased 23%. People love unlimited. Until they try to use it. Under the old policy, employees took an average of 17 days per year. Under unlimited, they take 11. That's not a bug. That's the design. When PTO is a number, people take the number. It's theirs. They earned it. Managers can't argue with a number. When PTO is "unlimited," people take nothing. Because unlimited comes with questions. "Is this a good time?" "Who's covering?" "What will people think?" The guilt does the enforcement. I don't have to say no. The culture says no. I just built the culture. We track time-off requests in Workday. I see everything. A senior engineer requested two weeks in July. His manager approved it. Officially. Then sent a Slack message. "Totally fine. Just wanted to flag that the Erikson deliverable overlaps. Probably fine. Just flagging." The engineer took four days. Unlimited means whatever your anxiety allows. For most people, that's less than before. Some employees don't take any PTO. We call them "high performers." They get promoted. Then they manage others. They don't approve much PTO either. The system self-replicates. A recruiter asked how we "stay competitive." I said, "Unlimited PTO." She asked how much people actually take. I said, "That's not tracked." It is tracked. I have a dashboard. I don't share the dashboard. We did an employee survey. 84% said they "appreciated the flexibility of unlimited PTO." 12% said they "wished they felt more comfortable taking time off." We published the 84%. The 12% went in a folder. The folder is called "Noted." I don't open that folder. Someone in engineering asked if we could go back to accrued PTO. I said, "That would limit your flexibility." He said he wanted limits. I said, "That's not aligned with our culture of trust." He stopped asking. Trust is a funny word. I trust employees to feel too guilty to use their benefits. They trust me to frame that guilt as freedom. That's the deal. I'm presenting at an HR conference next month. The session is called "Unlimited PTO: Building a Culture of Ownership." Ownership means employees own their guilt. I own the savings. The policy costs us nothing. Because employees take nothing. And call it a benefit. I'll be VP of People by Q2. Unlimited upside.