Of course the other reason for 'unlimited vacation' is so when an employee leaves, the company doesn't have to pay them for unused vacation days. Huge red flag when a company has 'unlimited vacation'
Here in Australia you have to give a full time employee a minimum of four weeks (paid), which accrues if unused. So somebody at a company with unlimited vacation would be no worse off of they never took holidays than someone who worked at a company with the regular 4 weeks.
With unlimited time off there's no longer any reason to stockpile days for that giant trip I keep putting off or to think of vacation days as being money that my employer owes me.
Before leaving the US I had 6 weeks annual leave, 4 rostered days off, 13 public holidays and usually a few extra days of stand down when the office was closed over Christmas (call it 50 days off).
Even coming from that I don't feel worse off now that I have unlimited time off.
Most Japanese get around 3 weeks of annual leave per year - but each day expires after 24 months.
It is quite common for leave to expire.
Japan has the same problem as the US in this case, your worth is tied to your work, the more it appears you're working hard, the more worth (and self-worth) you feel you have.
I can't help but think that a system where accrued days expire after a certain amount of time or you can't carry more than a certain balance would mean that people's vacation time would be spread out more. As a result I could actually get some stuff done now that requires coordinating with people. I'm not sure if there would be a cost, however, in not being able to get stuff done at other times of the year.
Other than not paying me if I leave mid year, what other reason could there be for crap like this?
Some places let you take the vacation before you accrue it but if you were to quit before earning enough to cover the days you've taken you owe the company money.
4 weeks off is not necessarily "extremely generous." It depends on whether that includes holidays.
You might say that of course vacation days don't include holidays, but I know of several small tech/biotech companies that just give X total days of paid time off, usually 25-30. You can choose to take those PTO hours on holidays or not, which is more flexible I suppose.
However, depending on the state and industry, there are 10-15 normal holidays every year. So, that 4 weeks off might really only equal 1-2 weeks of vacation, not so generous.
Other states view vacation as just an agreement between you and your employer. You basically agree that there are so many days you don't have to show up to work and they'll still pay you. That's it.
In the past I worked remote for an Atlanta-based company, and their employee handbook stated that they will pay out vacation up to a maximum of 40 hours. Anything in excess of 40 hours you had in the bank, you forfeited. I lived in a St Louis suburb in Illinois at the time, and as an Illinois-based employee they paid me my full vacation bucket when I quit.
Similarly, a friend of mine worked remote for the same company, but lived just across the river in Missouri. When she left, she got her vacation capped. MO and GA are among the states that do not view vacation as earned compensation.
Since you need this check, you wouldn't get your vacation days.
Anyway, while I agree with the red flag concern, I don't necessarily agree that companies have unlimited vacation in order to cause you to take less. Esp in the startup world, esp at early stage, I don't expect to see this sort of intentional subterfuge - esp because of how it could backfire. I do think a minimum vacation policy makes more sense and allows, esp in places like CA where vacation is earned wage, and unused vacation is paid out at the end of the year, to manage the way vacation is counted.
I also think a company with mandatory vacation should consider allowing people to take at least some vacation in the form of a bonus. Maybe they have a spouse who doesn't have as flexible of a schedule or just really enjoy their work. I don't think this should be an option for founders, however, and I think it should accompany a discussion, because it doesn't work for most people.
You can write any old thing you like and get someone to sign it.
That doesn't necessarily mean it's enforceable.
Writing unenforceable clauses into fine print -- that you know are unenforceable -- is a legal bluff older than keeping records on clay tablets.
Usually the way this works is they give you severance, which comes at a price: you won't sue them for any reason whatsoever.
Doesn't help if you're fired, of course.
It has an effect on the balance sheet, since vacation time accrued but not used is a liability; in companies whose operations are labor-heavy, and that have high-pay workers, that's may be a concern, especially when seeking investors, since concrete current liabilities can weigh heavily against hoped-for future returns.
Regardless of how much vacation time is on the books as a liability, the company's cash flows are exactly the same.
I don't see what sympathy has to do with it. The state of the balance sheet is a concrete concern for investors, and therefore for companies seeking investors, independently of whether you have sympathy for it or not.
> Regardless of how much vacation time is on the books as a liability, the company's cash flows are exactly the same.
Possibly, but so what? The statement of cash flows matters, of course -- particularly in the short term -- but investors care ultimately about value, not cash flow. (After all, borrowing money produces a positive cash flow the same as selling product does, the difference is that the former also accumulates liability.)
The liabilities may matter to investors, but that doesn't mean that they actually affect the business. If I have all of my vacation days left or none, there is zero impact on the the company's business. Value is not effected at all.
If they affect investors, they (1) effect the current owners, serving whose interests is the whole purpose of having a business, and (2) they affect the company's ability to secure financing and the terms of that financing, which affects every aspect of its business.
So, no, you're just plain wrong here.
> If I have all of my vacation days left or none, there is zero impact on the the company's business.
It has exactly the same impact on a company's business as any other debt, which is substantially more than none.
That's completely untrue. If you are billed out at some rate X, then having 2 weeks of vacation coming up this year directly impacts future value vs having 0 vacation days. That's X * 2 * 40 hours of future value. It affects value in the same way that any debt affects value.
In theory, that could be enough to tank a company that otherwise might've (somehow) survived the departure of their employees.
Seems like a good opportunity to test the limits of these "unlimited" vacation policies.