I don't think unlimited vacation is a good thing because it really isn't unlimited and just keeps the employee guessing as to what is appropriate.
If you are such an employer, please consider setting a realistic expectation of what is an appropriate amount of time-off. If there really is no limit, then please consider more intensive training with regard to your company's culture .
Number 3 was the worst. Passionate people will burn themselves out if you don't setup some sort of "vacation monitoring". We liked the idea of making that explicit: lots of vacation, and rules that force you to use them regularly.
In the end we went for 2+1 weeks on the first year, and 3+2 weeks after that.
Let's face it: american companies are not productive over thanksgiving and christmas. They just pretend to be. By making these 2 weeks vacation, we simply embrace reality.
I'm not 100% certain this would work in a bigger company where people think of it as "just a job". But in a small team where everybody is passionate and eager to make it successful, it works great.
Or maybe the 2+1 was for the first year you were a company, as opposed to individual's tenure?
1) The 1st year at dotCloud is a big step for us, and a lot of people didn't make it in the past. Making it means that somebody has truly proven his worth (since he or she wasn't fired) and has adapted to our unusual culture (since he or she didn't resign). By attaching perks like this to the anniversary, we emphasize its importance.
2) We don't want people to join for the vacation. We take a lot of breaks because that's what intense, hard-working people need to avoid burnout. But the majority of people on the job market are not hard-working and intense enough for our standards - we're hoping this will help us filter for them.
Fortunately, at my current company, when we switched to "unlimited" there was an added "and you're expected to take a minimum of 3 weeks per year". So, while the upper bound is still completely nebulous, by setting a reasonable minimum, it's clear they're not just trying to screw anyone over.
At Heroku, we are actively encouraged to take vacation. There has actually been talk of building something to track employee vacation time, to ensure that everyone is taking enough :)
Even though one might take comfort in a de jure number of vacation days, frankly, it seems to me that if one exists in a toxic culture when it comes to vacation no amount of policy is likely to make the situation much better. In the pathological case, it gets lost entirely from over-accrual or turned into a cash payout.
Another way to look at the vacation day policies is they are mostly a reflection of the work/vacation culture, not the cause of it. And in that respect, such a strategy makes it harder to evaluate an employer's gestalt attitude towards vacation. Too bad it comes with a bitter pill of accounting work for all involved.
For what it's worth: Heroku is my current and has been for a couple of years, and I take vacation, and have been reminded to do so. I'd say about 25 days/annum. I've not kept count, but I can think to some of the bigger-ticket travel making up most of that, so if there is a mis-estimation it is not vast.
What works much better is to just decide on what's an acceptable amount of vacation, say 3 weeks, and tell everyone that's what they get; take it or leave it.