Microsoft is giving US employees unlimited paid time off, ditching 4-week policy | Hacker News Reader

Microsoft is giving US employees unlimited paid time off, ditching 4-week policy

fortune.com

Yep, "unlimited vacation" sounds nice the first time you hear it. Until you realize that it doesn't mean you can take 8 weeks/yr of vacation, it just means that how much vacation you get is no longer clearly defined and you have to work it out with your manager. And also, the company no longer has to pay you for vacation you don't take.

Right, it's a reduction in benefits. And I'm no accountant but I'm pretty sure since vacation time used to be guaranteed, it had to be carried as a liability and this change means debt relief.

As such, I reminded my employer multiple times during our annual review that they reduced my compensation.

A good way to fix this and relieve the stress for the employees but get the PTO debt burden thing off the books is to just call it RTO.. recommended time off.. pick a number and say “while PTO is unlimited we have a recommended number that we hope most employees will target.. our RTO is 4 weeks for employees less than 4 years and 6 weeks for employees after 4 years.. again this is flexible, but this is our recommendation”

The fix is just to have accrued PTO. That way employees know how much they are allowed to take and if they get laid off or business needs prevent them from being able to use it, they get a payout.

Exactly true on the latter part. The main reason for "unlimited" vacation is to remove the debt load from the books. Vacation accrued and unpaid is debt that is owed out, and owed if they terminate someone.

Not sure how this might affect any downsizing in the near term for existing "earned" vacation time.

I'd prefer a 'guaranteed minimum vacation' and 'unlimited accrual and any-time buybacks'. I'm one of those people that doesn't mind working a year or two if it means I can then vanish for a few months straight and do a proper reset on vacation.

You always did have to work it out with your manager; that's not new.

What is new, and better for me, is that vacation time no longer feels like a scarce, nonrenewable resource, so I no longer feel compelled to hoard it.

Instead of deciding whether some camping trip or festival or ski weekend is special enough to justify burning a few of those precious vacation days, often choosing instead to save them up in case of a more important occasion later in the year, I can just... go do the fun thing. No bookkeeping, no worries.

I've had jobs with "unlimited vacation" policies for quite a few years now and I still do prefer it.

That only works if you are taking more vacation than you were before

It works because I take as much vacation as I feel inclined to, and I don't have to care how many days that is. I get what I want, so what difference does it make whether that's more or less?

If you have more of a maximizing attitude about your benefits, I suppose you might have a harder time enjoying an "unlimited PTO" policy, because it's not really possible to know whether you've squeezed all the juice out of it.

I'd rather have a guaranteed benefit (that, ideally, carries over from year to year and is fully paid out when I leave the company) than the gray area that you're describing which in practice is nothing more than the company being exploitative and relying on psychological dark patterns to trick gullible employees.

In my previous job, I quit with three months of unused vacation time, and I received three months of salary fully paid out. Not possible with "unlimited PTO". Furthermore, try taking 2+ months of vacation in a year and see how quickly you're called to have a meeting with the Bobs.

> I'd rather have a guaranteed benefit

Well, that's fine, if that's what works for you; I hope you continue to have that option for years to come.

> relying on psychological dark patterns to trick gullible employees.

That's a little harsh, don't you think? I've just explained why unlimited PTO actually is the policy I prefer, the one which suits my needs - but you seem to be dismissing the possibility that people like me could exist.

I'm not surprised that you see the PTO benefit primarily in terms of its cash value, if you managed to accumulate three months of unused vacation; presumably you don't take many breaks. For my part, I generally find lack of time to be a more pressing obstacle to the things I want in life than lack of money, so I don't care whether PTO has any cash value at all; what I want is flexibility.

> Furthermore, try taking 2+ months of vacation in a year and see how quickly you're called to have a meeting with the Bobs.

I suppose it would depend on the conversations I had with my manager before making those plans.

I did once take a solid month off, to go tour Morocco. It was a great experience. It wasn't actually company policy to offer that much time off, but I worked it out with my boss, and it was fine.

The book "Algorithms to Live By" by Brian Christian and Tom Griffiths has a small chapter on Nash equilibria in game theory and uses a interesting example involving 'unlimited' PTO in the corporate world:

  All employees want, in theory, to take as much vacation as possible. But they also all want to take just slightly less vacation than each other, to be perceived as more loyal, more committed, and more dedicated (hence more promotion-worthy). Everyone looks to the others for a baseline, and will take just slightly less than that. The Nash equilibrium of this game is zero.

Mmm . Sounds like useless economic theory.

I'd more so suggest the approval process of unlimited vacation relies more thoroughly on favoritism and how much time put in is determined entirely by the feedback management gives to individuals.

I'd posit very few implementations are employee driven.

This is pretty much what happens in Japan --but without the need for a pretense of "unlimited vacation".

I've worked in some toxic places but nothing that toxic. Time off has never come up in promotion discussions. I don't think people are really counting. I can barely remember last year, you think my manager remembers enough about other people to pit them against each other by a couple days of time off?

Were you part of management? I worked in an unlimited PTO and PTO was never discussed directly with the person, but management discussions often mentioned it, particularly if it was above average. I've often wondered if this was more an exception or more a rule.

no ive never been. though it seems like if something like that is happening, there must be so much more other toxic stuff going on that it would be the least of my worries. Ive never been somewhere were promotions were pitted against each other like that though. but the titles like "senior" and "staff" are given out like candy ime. maybe its different for a position in low supply like lead or director type role. But most people shouldnt worry i think then

But the principal knows that people will resent not having time off at all and will burn out. Why is this seen as having no negative consequences for the employer?

That doesn't factor in the social pressure to take at least as much vacation as your immediate supervisor. Not doing so can reasonably be assumed to be seen as a problem by the supervisor, since they demonstrably think that that level of vacation is important for their well-being.

Since no person* can work every day of the year for more than (1? 2?) years, and since supervisors will presumably feel they have greater job safety, over time a more reasonable baseline will be established by people higher up in the company, allowing all to have some time off.

There's also the question of how one is perceived by co-workers, since deliberately taking slightly less vacation than others in order to benefit from a perception of being a hard worker carries a risk: you are in effect deceiving others about your intentions. Since the easiest way to not be perceived as deceptive is not to deceive, avoiding the risk of harm to the level of trust others place in you would argue for taking the same, not slightly less, vacation as them.

*Not counting outliers

Unlimited time off is only good for the employer. They don't have to pay outstanding holidays if you leave or get made redundant. And unlimited doesn't mean unlimited. I far prefer a policy that dictates a minimum number of days that need to be taken off each year, and gives the flexibility to buy or sell holidays on top of that.

I dislike the wording. Clearly it's not 'unlimited', if you stay away for a year or four, they'll kick you out. It's 'unlimited' in the way that some 'flat rates' come with strings attached that make them very much not a flat rate because they'll just cut of the service if you cross some threshold.

Since Microsoft is a commercial entity, my assumption is that they've studied the policy's effects and found that many people will take fewer than 4 weeks if you ask them to "take whatever you need and what you feel is fair", so employees will feel that they've gotten a generous gift while Microsoft will make more profits.

And they don't need to pay out unused time at end of employment.

So as long as they take more than 4 weeks on top of the annual 4 weeks a year over their whole employment, they'll end up better off, even if their last day that year was Dec 31.

When a company I previously worked at went "unlimited vacation" and effectively tossed all accrued vacation time, a coworker started taking literally every Friday off as PTO to make up for the vacation time that was dumped. Having a 4-day 32hr week might be better than vacation in some ways.

And yet, people don't tend to do that because they fear being stack-ranked by their number of days off.

I mean don't get me wrong, if my employer were to go unlimited PTO, I would absolutely use it to the max I could (perhaps take Fridays off in addition to a month long vacation each year), but I'm also sure that I would get fired for it.

In the case of situations like those, do contracts with unlimited PTO have a clause with "you cannot fire X employee for being too much on vacation"? Speaking from a place of complete and utter ignorance.

Most of these contracts will have a clause requiring approval of holiday request by your manager.

Ok, that makes sense. So it's not Unlimited PTO "at will", it's "discretionary PTO according to your negotiation skills with your manager".

Generally the manager's hands are tied to by monthly HR reports. Any employee taking an excessive amount of holidays will be flagged up and the manager will have to justify such decisions.

Do US-based Microsoft employees even have employment contracts? Washington is an 'at will' employment state.

The concept of at will employment baffles me as a European, especially since healthcare is also tied up into it. Good point, I forgot that was a thing at all.

All states except sort of Montana are "at Will".

Wish this term would die since it's basically meaningless when nearly all of the country has it

I've seen cynical takes on unlimited PTO, where in practice nobody took time off for fear of falling behind. Then I've seen organizations that really tried to instill a value around taking time off regularly.

BUT, at the margins, at a relatively non-cynical company I was aware of one person who did their job well, but took more PTO than some vague sense of what was "reasonable" and this person was indeed penalized, despite there being no apparent mark on their performance.

I wonder why there isn't a move to offer a relatively generous PTO packages, say 6 weeks, with the option to receive up to half back as a bonus cash payment if they elected to not take all 6 weeks. That way you establish a sane baseline, but allow people who need R&R to take it without fear of reprisal.

Because companies don’t actually give a shit about employee happiness? That’s my guess. I’m not saying this angrily, either. It’s business, all decisions are a means to an end.

I really like the idea, though. I would love to get an extra paycheck at the end of the year.

I think every company likes not having the liability of PTO hanging on the balance books, and most companies quietly enjoy the reduction in average PTO taken. For the outlier users of PTO, they'd better be firebreathers, or I suspect they are PIPed out.

BUT, we were in a somewhat competitive labor market up until very recently, and likely will be again some day. A generous PTO policy grounded in explicit policy would absolutely be something I'd weigh heavily in a competitive market for labor.

Similarly, I know people who don't take their owed vacation and build up to the "max" and wind up having to take several weeks off at a time or lose it. In a job without accrued vacation, they simply don't even earn it in the first place, and don't get paid out for it if they are let go.

Cynical me thinks this is a precursor to layoffs in order to get the debt off the books and not pay out anyone that gets "downsized" in the end.

Everyone who currently has a carryover balance is getting paid out, so I don't see how that would help costs during a layoff unless that layoff is 6+ months out.

Personally I carry a balance of close to 4 weeks (my current max accrual) as an extra cushion for job-changes or a rainy day and they will pay me out for it. I'll stick that in my emergency fund and it will serve the same function.

Layoffs could just be 6+ months out. While management is often short-sighted, I don't think we can just dismiss this possiblity.

To be fair, in the internal email they described it as 'discretionary pto'.

I’m going to go against the grain and say I love unlimited PTO. Gone are the days when I’m counting my PTO and I can just take trips or time off whenever I feel like it.

I’d like to say that I’m a contributing member of my team and I have a good rapport with my manager so I’m never worried he’s going to reject my request.

I see it that way to. I'm sure what people describe is true in some cases but I'm also sure that there's tons of more positive examples. Especially when the employee is, as you said, productive and reasonable.

If you get fired for taking 8 weeks vacation then something has gone wrong waaay before that and something about the manager/employee relationship is off.

Same. I don't have to count days, or worry that I'll need my time later in the year. If I want a day off, even if it's for no real reason, I take the day off.

Depends if you work for a job that lets you take advantage of it. M$? Fat chance.

Even if that's the case, it certainly gives them the ability to pull the rug out from under you at any point in time

Yeah but they can do that a bunch of different ways and to me, it’s a sign to jump ship

jumping ship is a good solution on an individual level, but protections for workers are a better generalized solution.

In my experience if I'm on excellent terms with management because I'm a productive and valuable employee, there's never any problem getting time off in either of these paradigms.

But with the metered PTO benefit, I generally receive more income in the fullness of time.

Perhaps a better term for "unlimited time off" should be found. I feel like it anchors the whole thing in a weird territory. It's certainly not unlimited and entirely at the discretion of the manager/decision maker. I know its a small gripe but somehow it always feels so off saying "unlimited time off."

* I like the idea behind it. In practice and on paper tho it seems to have mixed results.

I propose 'Uncertain Time Off'!

Gangster PTO: "take off all the time you need, but be careful or that nice job of yours might have an accident"

Unlimited PTO is a scam

Indeed, anytime you are promised an unlimited amount of a limited resource it is clearly a lie.

If they actually meant it, they would call it "infinite PTO".

I wish I were just starting out; to get hired at one of these places and immediately take unlimited PTO just as an experiment and see how far it could go.

Now they just need to have competitive comp with the other big players and they'll be the best place to work. Amazon's PTO policy is honestly pathetic, and Google's isn't much better. Google and Amazon still pay a lot better than MS though.

Would this be legal to do in other countries that have actual standards for paid annual leave?