Are “Unlimited Holidays” All They’re Cracked Up to Be?

As an employee benefit, unlimited holidays sounds like a crazy idea that couldn’t possibly catch on.

How could organisations work productively if everybody could take as much holiday as they liked, whenever they wanted?

Yet the idea has been gaining popularity in the US, where there is no statutory minimum level of annual leave.  Meanwhile, in May this year, the investment bank Goldman Sachs announced its new “flexible vacation” plans, which allow its senior staff unlimited holidays.

While it could seem tempting to follow this trend, employers are advised to think carefully before implementing a policy of unlimited leave.

Here are some key points to consider:

How much leave do your employees currently take?

In the UK, full-time employees have a legal right to take a minimum of 5.6 weeks’ paid holiday – or 28 days per year.

If your employees already struggle to take their full entitlement, unlimited leave is unlikely to be seen as a benefit.  Instead, it might be worth investigating and addressing the reasons why holiday isn’t taken (overwork or lack of cover, for example).

Which employees would benefit from unlimited leave?

It’s worth noting that many policies of unlimited leave, including that of Goldman Sachs, apply to senior members of staff only. 

This could cause resentment among junior staff, who may feel undervalued as a result.

What could you offer employees instead?

In a People Management article, Emma Clark, a partner at Keystone Law, suggests that instead of offering unlimited holidays, employers could focus on flexible working, or “designating days in the week that are free from video calls” to help all employees disconnect.

Employers could also think about increasing statutory leave entitlement by a fixed number of days, or introducing specific incentives, such as a birthday ‘day off’ for each employee every year.

To ask further questions, or for bespoke guidance, please contact our experienced team at Viridian HR.




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