Don't Let An “Unlimited” Vacation Policy Kill Your Startup

Don’t Let An “Unlimited” Vacation Policy Kill Your Startup

This is how to create a real unlimited vacation policy that will help your teammates recharge and return at their best.

Most vacation policies lead to burnout and unhappy teams. Here’s another way.

Last updated: October 18, 2017

It’s almost silly to say that “hard work is important.”

It’s not just important.

Relative to just about everything else in success—strategy, tactics, networking—hard work (done smartly) is everything.

If you work hard every single day, and apply the right strategies and tactics to that hard work, you will win eventually.

If you have the best strategies and tactics in the world, and don’t work very, very hard to execute on them, you will lose.

Every. Single. Time.

Every successful person that I know—and, I’m willing to bet, that you know—got there only after a lot of hard work.

And that’s something that we can all learn from.

But something that people who have bought into the religion of hard work—even many who are successful—struggle with is balance.

Working hard, but taking time off to relax, recharge, and do other things that make them happy.

I’ve certainly struggled with it, and I continue to do so.

But every year around this time, as folks begin to make plans for the holidays, I’m reminded just how important it is to take time off.

Why Every Business Needs to Encourage Taking Time Off

Vacation is a touchy subject, especially in the States, and paying lip service to it isn’t enough.

“Unlimited vacation” policies abound in businesses full of overworked, unhappy people.

Employers tell their teams that they should feel free to go on vacation, but never do so themselves.

Employees are scared of looking bad, or feel guilty increasing the workload of their coworkers by taking time off.

But both of these excuses are, to put it frankly, bullshit.

Ernst & Young did a study that found that for every 10 additional hours of vacation time their employees took, their performance ratings from supervisors improved by 8 percent.

Unlimited vacation policy: The Benefits Of Vacation
The benefits of vacation

At the same time, overworking without breaks takes a huge toll on our health, making us sick in all kinds of ways.

And it hurts companies, too. One study found that employees’ lack of sleep—a curse I fall victim to every time we start to work too much—cost companies more than $63 billion in productivity each year.

To me, there’s no doubt about it: the dangers of not taking time off from work massively outweigh the (diminishing) benefits of putting in those extra two weeks every year. It’s hard to remember to take time off, especially at startups, but it’s also critical to your success as a business.

How We Make It Work as a Small Remote Team

We all take time off from work—we have to—but that doesn’t mean it doesn’t come with challenges.

The toughest thing about making vacations work in a small team is that we don’t have a lot of overlap in our roles; we’re all critical.

If our only designer leaves for a week, well, nothing is getting designed that week. We can’t simply step into each other’s shoes.

There are three things that we’ve found work best to ensure that vacations don’t end up bringing the company to a halt:

1) Build Vacation Time Into Your Roadmap

Realistic roadmapping is one of the biggest struggles for almost any startup.

Until your team has been working together for quite some time, almost everything takes longer than you think it will. And that’s with everyone working at full productivity.

But when an employee goes on vacation—or even has a sick day—things can get bad, fast.

One of the most important resource planning lessons we’ve learned is to budget liberally for vacation time and sick days, so that they never come as a surprise.

Our weekly project plans look less ambitious than they did a year ago, but we hit our milestones far more consistently.

Takeaway: Make sure that you’re accounting for time off in your project planning. It’ll avoid painful stalls and missed milestones when team members get sick or go on vacation.

2) Frontload the Work

Another critical consideration: don’t just budget for less work to get done when a team member is gone.

You also need to budget for less work the week before a vacation, as the employee will need to spend time doing work that minimizes the number of tasks that get pushed onto teammates.

Take this blog, for example: generally, after a post is written, I’ll work with our designer to build the images and code the post. Then I’ll write the email that gets sent to our subscribers, load that into Campaign Monitor and queue it for sending.

Blog workflow
Blog workflow

Before I left, I spent extra time doing those tasks (and scheduling the email sends) so that nobody else would have to. In fact, just about the only thing that nobody else can do—answer my emails and comments—was all that was left to do during the time I was away, and that was what I spent that hour of work doing.

With the work frontloaded and the right systems in place, the company still ran with minimal disruption to everyone else’s workflow.

Takeaway: Think about what needs to be done while you’re away, and do your best to minimize what gets left to your teammates. By doing the extra work up front, you let the company run as seamlessly as possible without you.

3) Hire the Right People

I’ve talked a number of times about how important hiring the right people is, especially for a remote team.

When it comes to handling workload and time off, having the right team is critical.

As a remote team, we can’t babysit each other. So just as important as it is to hire people who can “be their own CEO” and get their work done, it’s also important to hire people who know how to manage their workload without getting overworked, and who already deeply understand the benefits (for the whole team) of taking time off.

If someone on the team can’t handle the combination of remote autonomy and startup craziness, they’ll burn out fast. Burnouts lead to lost productivity and stalled progress, and we all know where that leads.

Takeaway: Hiring the right people is important for so many reasons, but keeping your team sane and healthy is a big one. Make sure new hires know how valuable time off is, and how to manage their workload to ensure that they don’t burn out.

4) Set a Practical Policy

I mentioned above why I don’t believe in “unlimited vacation” policies; they may empower vacation time, but they certainly don’t encourage it.

Instead, a defined window lets employees know not just how much vacation they’re “allowed” to take, but it signals how much they’re supposed to take.

So if you want your employees to take a generous amount of vacation time to be a competitive employer and keep your team from burning out, then define what “generous” means to you⁠—whether that’s three weeks, four weeks, five weeks or more⁠—and make that the policy.

And if you’re worried that it’s not enough, add a stipulation that employees can always ask for more.

But start with a defined time window; it’ll anchor what a reasonable amount of vacation time is for your entire team.

And that will go a lot farther toward encouraging your employees to taking vacation time than an unlimited policy ever could.

Takeaway: Unlimited vacation empowers, but it doesn’t actually encourage vacation time for many employees who see it as an invitation to show how little time off they need. Set a time-limited policy, and offer exceptions for more, but set the expectation that your team is expected to take at least that much time off.

How to Apply This to Your Business

I’m not the best at “turning off.”

Often—like today—the bags under my eyes are proof of that.

But it’s something that I’m actively working on, and it’s why this month, I’m pledging to shut off for a week.

I hope that this post inspires you to do—and push your team to do—the same.

Grow Blog
Alex Turnbull

Alex is the CEO & Founder of Groove. He loves to help other entrepreneurs build startups by sharing his own experiences from the trenches.

Read all of Alex's articles

Join +250,000 of your peers

Don’t miss out on the latest tips, tools, and tactics at the forefront of customer support.