In this month’s Sunday Telegraph column, I explore vacations through the lens of Netflix, Inc., which has taken a peculiar approach to paid holidays. At Netflix salaried employees (though not hourly workers) can take all the vacation they want — whenever they want to take it.  Somehow it works. (More: Check out Netflix CEO Reed Hasting’s now legendary slide deck about his managerial philosophy.)

Previous Sunday Telegraph columns:
July: Can you speak human at work?
June: Is Bob the Builder the ideal leadership role model?
May: Could ending sales commissions increase sales?

10 Responses to “Is the best vacation policy no vacation policy?”

  1. Phil Dyer says:

    Dan – Very interesting article. I agree with this approach…

    Work tends to expand to fill the time allotted, so if you are given a work week to accomplish all of your tasks, that is how long it is going to take you.

    However, it someone is told on Monday that they can finish their work week as soon as all of their assigned tasks are completed, many people would be done by noon on Monday!

    The days of “been seen to project productivity” (employee view) and “I must see you to know you are being productive” (management view) are numbered.

    As long as things are done accurately, delivered on time/target and adding to the bottom line, why should the amount of time off matter?

    It will be interesting to see how this develops!

    Phil

  2. Lissa says:

    Good faith is what we need more of in all areas of our lives. What boggles my mind is how even employees will argue for their own continued oppression…the American Dream of striking it rich makes us amenable to being worked to death just because we all hope to someday be the (rich) boss who, ironically, demands too much of employees while paying them too little.

    I see reverse psychology in the Netflix approach. By allowing unlimited vacay, perhaps employees will feel too guilty taking much of any?

    Why can we not have the European system in the U.S.–the six weeks or so of paid vacation every year?

    What about working parents in the U.S. dealing with summertime schedules of their school-aged kids? Now, THERE’S an impossible situation…

  3. Neil Shah says:

    Hi Daniel,

    Very Interesting observation. I agree with the “no vacation” policy especially for smaller organizations where autonomy and freedom is promoted in other aspects as well – from thinking, brainstorming process to acting independently. This can not only be a stress-buster but the biggest advantage this autonomy and freedom provides is that the employee at every level in an organization will actually learn to be more responsible for what and when he/she does, having more control over the work they do and in-turn boosting productivity, creativity and self-development. This is what every employer dreams of..and employee with above qualities can grow the business.

    The only limiting factor for adopting this work-culture is that most of the employers has the fear i.e. how many % of people will abuse this freedom…and what will be the measures taken by the employer if the % of such employees increases.

    But if we look at this issue (if ever it comes up)and if the % of such employees is increasing it actually gives warning signals to the employer that there is something wrong out there that the employees no longer are motivated. This gives employer opportunity to find the real problem out there pertaining to those employees and the employer can definitely invest time and resources to find-out what’s troubling those employees and assist in solving their issues in order to keep its employees motivated and boost the work-culture, productivity and eventually the business.

    In some cases (I believe in most) there will be very few selfish employees who can be shown the door..so that these rotten apples don’t corrupt the others too..as complacency can be really contagious and the employer might then lose faith in this work-model..

  4. Jim Knutsen says:

    I’ve had a no vacation policy in place at my company for going on 12 years. In that time, I’ve had exactly one employee take advantage of the policy. That person is no longer with the company.

    For everyone else, the policy has been a powerful statement of trust and an investment in future performance and commitment paid off many times over.

    Everyone keeps telling me we’ll reach a point where the company’s too big for a policy like this. Netflix proves that theory wrong.

  5. Blake says:

    The places where I’ve worked for the last few years, the problem hasn’t been running out of vacation time, it has been capping out on PTO because you can’t get away.

    I wonder if NetFlix is actually saving money on PTO sellback options after this policy went in place… Also, I wonder how much time off the workers are using.

  6. All I know is I just got back from a week vacation 🙂

  7. Chris Frost says:

    Excellent article Dan, this approach is great, i bet Netflix employees are loyal – reminds me of Zappos and their approach to employees.

  8. Casey says:

    Glad I saw this. While traveling, vacation time between the States, Europe, and Australia often get brought up. Hopefully the U.S. will continue to move in the healthier direction.

  9. MIkeS says:

    Had something similar at a small company I once worked for, but for sick leave. We didn’t have a set number of days for sick leave. The company policy simply stated was if you are sick stay home, get well, come back and work hard. Not once did we have an employee abuse the policy. We were a small company so we couldn’t afford for too many people to be sick at once. And rather than have someone feeling like they had to work because they ran out of sick leave days and risk getting the rest of us sick, they could stay home, get the rest they needed and come back healthy.

    Many of the employees worked long days and at times even sacrificed a weekend on occasion for the company. We appreciated the fact that our boss treated us like adults and expected us to act like adults – here’s your job, do it, and do it well and we will reward you for your effort.

  10. Donna says:

    Great information! It seems like the ideal state. Has anyone ever seen any commentary from a NexFlix employee, especially a middle manager, regarding the true level of implementation and what they think of it (esp the high performance or you’re out expectations)?

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