One of the experiments you tested in the HR future team was unlimited personal time off. Can you tell me more about that and what the results were?
Sure. Because we’re an HR company and we give out a lot of HR advice, we consider ourselves an incubator for HR ideas, a place to test out new ideas and see how they work. A couple of years ago we started getting calls from companies that had been hearing about this idea of giving unlimited time off and wanted to know our advice. Good policy, bad policy, how do you implement it. And candidly our HR team was divided. Half the group thought this was not something to advise. It created too many challenges for an employer to manage. The other half thought that for the right employer, the right context, it was a good idea.
And the way we were going to solve this, we thought, was by trying it ourselves. We gave ourselves one year. Previously, we had a more traditional defined vacation or paid time off policy. And we scrapped that and we put in place an unlimited policy. We were very deliberate in communicating with our employees that this didn’t mean that they shouldn’t take any time off by taking away that defined amount. We still wanted them to take vacation, to refresh, spend time with their families, their friends. We tried to be very clear about the expectations. And we told everyone this is an experiment. At 12 months we’re going to look to see how we did.
Over the next 12 months, people traveled all over, they coached mock trial teams, they attended friends’ weddings abroad. And at the end of the 12 months I sent a survey to all the employees asking them to rank our benefits, the ones we currently offer and some that we were considering offering. And paid time off, the unlimited paid time off, came in third, right behind health insurance, right behind 401(k) match, unlimited PTO. It was dramatically higher than things like dental insurance, vision insurance, professional development. And I saw this result and I thought, wow, this is clearly a benefit that people are attaching a lot of importance or value to.
Well, then we crunched some numbers to see how people had actually used it. And I was really surprised by the result. Because the year before we implemented this, on average people in our company took 15 days of time. And that doesn’t include holidays, but 15 personal paid days off. Then we implemented this. And the average in the year we implemented this rose from 15 to 16 days off. One more day. That was surprising to me, especially in light of the value that people seem to attach to it. They seem to really care about something that hadn’t really dramatically changed their lives.
We started to think about this. And we realized that this whole idea of unlimited paid time off was really more important for what it said to our employees than what it actually did. Everyone knew they had a job to get done, and they needed to get it done, and their colleagues, their clients were depending on them. But it sent a message of trust that they’re going to be able to manage their lives. Now, it wasn’t all perfect. Because there were some communication issues around what it meant to have unlimited time off, and how you evaluate a full contribution of work, a full portfolio of work, when there’s no longer an issue of how much time you’re spending in front of your computer. It raised a lot of interesting questions. And we made some changes, although we continued the program.
The first change we made, we don’t call it unlimited time off anymore because that became just sort of marketing click bait, or recruiting click bait. And that almost cheapened the program. Now we call it personalized PTO. Because the idea is that it isn’t unlimited, you do have constraints, but you’re able to tailor it to your personal needs. And if one year you have a sick relative that you need to – and want to spend time with. And another year you don’t have a lot of vacation planned. It’s up to you to sort of balance all of that out.
Another change we made is that we now communicate it more as a two-way street. The company will invest in you by giving you the time and flexibility you need to manage your life, and we ask you to invest back in us with being fully engaged in your job and our company. And everyone responded well to that because people don’t like gimmicks. And the third thing we did is we tied it to one of our core values. One of our five core values here is Care to the Core. And we messaged to our employees that really this policy is rooted in that. It’s not, like I said, a recruiting click bait or something. It’s really tied to who we are and what we care about. And one of the things we really care about is our employees, our colleagues, our clients, our partners, and supporting them and seeing them as whole people.
The idea of giving people more flexibility comes back to the idea of, when you come in this company, you’re a whole person, and we want to support you in your life both within work and outside of work. It was an interesting experiment. We continue to offer this policy. We don’t advocate it for every company. It needs to be culture and company specific. But it was an interesting experiment.