An Unlimited Vacation Policy sounds super on paper but is it really all that meets the eye?

Companies that tend to offer an Unlimited Vacation Policy do so with the intention of providing their employees with a flexible work-life balance.

When employees are happier, the company tends to perform better.

The policy is in place not for the employees to abuse the perks of a free vacation trip rather the intention is to allow you to plan a vacation at any time you feel the need to.

The Unlimited Vacation Policy can be a great benefit when used in the right sense.

However, when abused there are drawbacks.

Let’s dwell deeper to get a clearer picture of how the Unlimited Vacation Policy works.


What does “Unlimited Vacation Policy” truly mean?

The policy means taking time off whenever you feel the need to but should be within an acceptable timeframe of a professional environment.

Employees are in control of their own vacation time provided they are able to complete their projects within their respective deadlines.

A study conducted by the Center for Economic Policy and Research Study has pointed out interesting facts on vacation pay for employees based in different regions of the world.

  • 65 percent of Americans don’t use their paid time off
  • American employees receive an average vacation time of 13-days per annual year
  • European employees receive an average vacation time of 20-days per annual year
  • Out of the 13-days of allotted vacation time for Americans, 8 days per year are considered paid leaves
  • Both European and American companies offer additional days of leave for workers above the age of 60
  • The United States ranked the lowest among the developed companies for providing their employees with paid vacation leave with Japan and New Zealand providing their workers a 20-to 30-day vacation period in a year
  • The European companies offered a better vacation pay compared to the American companies

With the above statistics, we can boldly claim that an Unlimited Vacation Policy can benefit or be a drawback depending on how many days you intend to take a vacation for.

Consider this example — If you are someone who completes their work on time and likes to take time to travel around the globe, an Unlimited Vacation Policy makes the most sense.

However, if you’re someone that prefers to work and gain additional remuneration by claiming the unused vacation period, an Unlimited Vacation Policy may not be an ideal option since an Unlimited Vacation Policy usually means no vacation pay under the contract.

How does the “Unlimited Vacation Policy” operate in a Real-time Scenario?

Freedom of choosing your own leave doesn’t automatically free you from your responsibilities.

Companies offer the policy on the basis of the employee being able to complete their deadlines and produce great results. If the latter isn’t achieved, the benefit of the former is lost.

Here are examples of 8 major companies around the world with their unlimited vacation policy and a quick summary of the benefits offered —

  • GitHub  Development Platform. GitHub provides its project managers around the world with unlimited time off to ensure their workers are motivated, happy, and focused on their goals.
  • MWI — Digital Marketing Agency. The company strongly believes in great pay and unlimited time off to the secret of their success. There aren’t any working hours set by the company and the company also provides its employees with work-at-home options.
  • Email Aptitude — Email Services. Apart from unlimited vacation policy, the folks at Email Aptitude ensure their techies gain cool perks in the form of gadgets for new parents, company sponsored trips and a whole lot of insurances.
  • — Education Management. The team at receives annual conference allowance along with anytime vacation and flexible work hours to boot.
  • Bonfire — Software Development. All employees are provided with Apple devices, a competitive compensation package, and unlimited vacation time.
  • Articulate — E-Learning. Articulate has a unique “results-only” work environment, which focuses on providing unlimited vacation time to its employees and also many seminars are held to increase employee efficiency.
  • Bloc — Online Education. While Bloc doesn’t offer all its employees unlimited vacation package, those who’ve have been part of the company for a long time enjoy this benefit.
  • Impact Health — Health Insurance Search. Remote working, beachfront office, unlimited vacation policy are some of the many perks that employees get to experience at Impact Health.

With these above-average benefits offered by companies, unlimited vacation policy serves as an attractive way to ensure employees are retained by the company and enjoy their own flexible work time.

Here’s a video debating the advantages and disadvantages of Unlimited Vacation Policy.


Job satisfaction to employees means better employee retention

Retaining top employees is a major priority for most companies.

By unleashing the “Unlimited Vacation Policy”, companies get to woo employees into staying back.

Companies understand the psychological factor behind the unlimited vacation policy, it means the employees are motivated to completing their work earlier to attain a quick rest day or two in the process.

Richard Branson of Virgin Group strongly believes and states “We spend most of our lives at work. Life should be fun, so work should be fun.”His company is known to offer a lot of flexibility in the workplace and his employees are happy that they get to spend quality time with their families.

On a business front, Richard states that most seasoned employees understand the value of completing their targets on time and hence, they must be rewarded with the ability to choose their own free time.

Another great thing about the vacation policy is that employees get to travel on off-peak times to avail massive discounts in accommodation and airfare.

Save Costs on Unused Vacation Pay with the “Use-it or Lose-it Policy”

When employees don’t use their vacation time, it’s reimbursed back to them in the form of payment upon resigning from the company. By using an unlimited vacation policy, the company saves on huge costs over time.

According to the Fair Labor Standards Act (FLSA), employees aren’t entitled to a pay package regarding their time off work unless it’s mutually agreed by between the employee and the employer at the time of signing the contract.

The companies that don’t provide an unlimited vacation policy usually end up paying the employees for unused vacation time and this can cause a financial burden on the company.

An unlimited vacation policy ensures the company doesn’t have to pay out any vacation pay as the vacation time is chosen by the employee and they have no restriction on that time period.

Hence, the payment is forfeit.

Another aspect that saves money for the company is the fact that employees are healthier when they are happy and motivated.

This saves costs on medical insurances and disability insurances in the long run.

Every time an employee needs to head out for a routine health check-up, they don’t need to fret and can complete their monthly appointments using their flexible vacation period.

In this way, they are less likely to fall sick and have a heightened sense of productivity.

Boosts morale and productivity among employees

By going on a relaxed holiday when needed, many employees turn up to work with increased confidence and energy.

Productivity is increased, and the employees are happy with the company. This boosts the overall satisfaction rate in the company and the positive attitude begins to infect other employees working in the company.

One of the biggest negative factors facing employees working in companies is the lack of an ideal work-life balance.

By offering the freedom to choose your own vacation time, the company creates a fairground where all the employees are treated alike with no ranking system to divide each other.

When an employee is happy, they tend to come up with engaging ideas and renewed workforce that is absent in employees that are denied the freedom of selecting their own vacation period.

Serves as an early trigger warning for non-productive employees

The company can conveniently access past records of employees who’ve abused the vacation system and take stern action on them.

This is a great way to identify the hardworking employees from the lazy ones. The company gets to assess the employees in an efficient manner and ensure they retain only the best workers in the company.

In time, an unlimited vacation policy creates loyalty among the co-workers in the company with an emphasis on time management.

Take for example — Employee A needs to go on a vacation, he can discuss his plans with Employee B to handle the project until he returns.

Employee A can do the same for Employee B when it’s his time to go, in turn creating strong employee loyalty between each other.


While the unlimited vacation policy is a great perk to have there are certain factors that you probably haven’t understood, and it could surprise you in a bad way.

The Work-Martyr Syndrome

In the long run, when you sign up for a company that offers an unlimited vacation policy, you are bound to notice that none of your colleagues seem to take the weekend off to go on a vacation.

This is because everyone is trying to compete with each other and look good in front of their senior bosses. The Unlimited Vacation Policy can cause you to postpone your vacation in favor of working through the ranks and beating the competition.

Eventually, you end up denying your vacation period and this can be a bad deal considering you don’t get a normal vacation allowance compared to other companies. You also forfeit your unused vacation pay since Unlimited Vacation Policies don’t come with paid vacations.

Effective Solution

Reward yourself with a vacation if you’ve worked hard enough in the company.

You don’t deserve to overwork yourself and burn yourself out.

The point of an unlimited vacation policy is that you should be able to take it at a time that you prefer. Ensure you create a printed vacation plan beforehand and go through with it.

This way you end up utilizing your perk and also ensure your work is completed.

Guilty Vacation Time

Taking a vacation off from work in an Unlimited Vacation Policy perk means the company makes the rest of the team work harder than normal and hence, whenever you do decide to go on a vacation you are bound to make your co-workers work harder on your behalf.

When you’re back don’t be surprised to find many frowny faces glancing your way.

Similarly, when you end up taking the damage for your colleague’s vacation, you are bound to get annoyed at them for leaving you in a pile of mess. The Unlimited Vacation Policy may seem great at first, but it can surely catch you off guard with its negative aspects.

Effective Solution

Communication is key if you want to maintain friendly relations with your co-workers.

Get to know all your teammates and let them know you’ll be taking a vacation beforehand.

This way when the time comes, they can plan a strategy to get things done when you’re on leave.

Similarly, request them to do the same so you can ensure all your important projects are complete and you will be able to take up their projects during their absence.

Complexity in Work-Life Balance

The hardest decision when working in a company providing you with an Unlimited Vacation Policy is knowing when is the best time to take the vacation without hampering your chances at a promotion.

Take this example — If you’ve been angling for a promotion and you’ve worked hard enough for a year, you’d be hesitant to take a vacation as you feel you’d be cast out when the time of promotion comes.

Sadly, many companies understand this and misuse the policy to ensure their employees don’t take a vacation while working long hours.

They use the excuse of competition to get quality work hours from the employees and in the end, you’d feel like a donkey chasing a carrot on a stick for the rest of the journey.

Effective Solution

Tell yourself this — “If you’ve been a key employee of the company, the promotion is bound to come your way.”

Companies promote employees based on their performance and not based on how hard they work.

So, if you’re aching for that vacation, its time to book your tickets and settle on the sandy beaches of Miami.

Here’s an informative video guide that weighs the advantages and disadvantages of unlimited vacation policy.


Yes! You’re in control of your own leaves but this doesn’t mean you aren’t under the prying eyes of your management every time you decide to take time off.

It’s not acceptable to take off on a vacation soon after you’ve just had one.

Communicate with Your Seniors on Your Vacation Plans

If you intend to take a two-week off, do mention it to your boss so he can entrust your responsibilities to another colleague until you’re back.

A heads-up email with an emergency contact number is essential when taking off.

The human resource department is bound to record the dates that you don’t show up to work even if the policy loosely states that your vacation time isn’t being documented.

It’s important to read through the fine print in your contract to understand the exact meaning of your unlimited vacation policy. Always inform your HR department to provide them with a heads-up notice so they can arrange for a temporary replacement in your place.

Your company is bound to expect you to take advantage of this perk, but they are sure to have a strict system in place if they find you abusing the policy.

Be sensible in choosing your vacation time and also consider the other times that you might take a leave such as — sick days, medical checkups, and emergency situations.

All these can add up to become a liability to the company and you could end up being fired for your sluggish behavior.

Maintain the Trust Factor

Your company trusts its employees enough to hand over the rights to manage their own vacation.

Hence, the expectations in such a company are high and you will need clear planning of your time-off if you intend to be in the good books of your seniors.

There are other options to consider without going on a total vacation and still being productive for the company —

  • Work from Home. You could ask your boss to allow you to work from home when you feel the need to relax and take the day off. This way you are being productive and also spending the time in the comfort of your home sipping your favorite cocktail. Performance isn’t necessarily a trait that is measured in the 4-walls of an office and ultimately, the company only wants you to finish the work that has been assigned to you on time.
  • Increase Performance. Companies want nothing more from their employees other than to dedicate themselves fully to their cause. So, when you’re working in the cubicle of the company, it’s necessary to give it your best and ensure all the deadlines are sent before their last dates. This can increase your trust factor with your senior management and you could also end up being promoted for your dedication. The better your work the longer the vacation period you can take.


While an Unlimited Vacation Policy completely restructures the way, an employee can avail his vacation time, it isn’t entirely without its dark corners. In practice, employers stand to benefit more from the policy compared to the employees.

It’s easier for companies to save up on costs and fire non-performing employees and retain the best.

It’s in your best interests to study the documentation offered by your recruitment company carefully before you sign the dotted lines. If you are in a position to take advantage of the unlimited vacation policy, then its one of the most satisfying perks to have.

Unlimited Vacation Policy What You Should Know

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