TECH PERKS

Austin tech firms' new recruiting tool: Unlimited time off

Posted July 28th, 2016

Story highlights
  • More Austin firms are offering unlimited vacation to employees as a recruiting tool. 
  • Unlimited vacation? Sounds like a dream, but for several Austin companies it's a real policy. 

Leah Pasch, a technical writer at Indeed.com, will be taking three weeks off in October for a dream vacation to Europe. 

As she planned the trip, one thing she didn't have to worry about was using up too much of her vacation time.  

Indeed, an Austin-based internet job search company, in January changed its policy to let employees take an unlimited amount of paid time off, including sick days and vacation time.

"I've always had this mentality that I need to save my days in case I get sick, or something unexpected comes up with my children. It was stressful," Pasch said. "Now I can take time off to recharge without worrying. I love it."  

Indeed is one of a number of Austin technology companies that have begun offering unlimited paid time off to employees. Employees simply clear the time off with their managers and, as long as they get their work done, they can take as much time as they like.  

It's a workplace perk that started in Silicon Valley and is now becoming part of the culture of tech companies around the country, said Allison Berry, a community expert with jobs site Glassdoor. 

RALPH BARRERA/AMERICAN-STATESMAN STAFFLeah Pasch works as a technical writer for Indeed, and loves the company policy of unlimited PTO, which enables Pasch to take a lengthy European vacation. 

“For employees in the tech space, that perk has started to become more of a standard,” she said.  

Unlimited vacation is still rare in corporate America, with just 1 percent to 2 percent of companies offering the benefit, according to the Society for Human Resources Management. 

But non-tech firms, including General Electric and Virgin Airlines, are increasingly taking a cue from the tech world and adopting no-limit vacation policies.  

In Austin, where the competition for tech talent can be fierce, offering unlimited time off is becoming a key recruiting tool, both in attracting experienced workers and millennials, recruiters say.  

Veteran engineers and marketers are more likely to make a move if they don't have to rebuild their vacation allotment, and employees right out of college value the freedom and autonomy that come with being able to make their own call on how much time to take off.  

That's what Austin startup Edgecase, which sells software for online retailers and offers unlimited time off, has found.  

"As a three-year old company, we have to get creative on how we can attract good talent to our pool," said Jessica Hamilton, vice president of finance. "Most startups unfortunately aren't capable of paying salaries that larger companies offer, so we have to come up with new ways to attract folks to our company."  

Younger employees, in particular, like the idea of not needing to micro-manage their vacation days, she said. 

"They're looking for companies that offer this benefit, because they're not looking to work their lives away. They have hobbies, and play sports, and volunteerism and participating in mentorship programs is huge. They come to the table with different interests and make it clear in the interview process that's what they want." 

Culture is key 

Companies cite the benefits that unlimited time off can offer employees. But there is also a financial upside for companies. Under a traditional policy, employees accrue vacation time throughout the year or begin the year with a set number of days.  

But when employers no longer provide a set amount of vacation days, they don't have to pay out unused days if workers quit or get laid off from the company. (Some companies provide unlimited sick days and vacation time, while others administer sick time separately from unlimited vacation.)  

Whether an unlimited vacation policy is successful depends largely on the culture of the company, experts said.  

The programs only work if a company trusts their employees will do the right thing and “not just take all their time off and not have it get in the way of goals they are supposed to meet," Berry of Glassdoor said.  

It's also crucial to have a work environment that encourages taking personal time. "If you have a team or a structure where nobody else is taking time off, that can discourage you from taking time off,” Berry said.  

LAURA SKELDING/AMERICAN-STATESMANBazaarvoice recently opened a new global headquarters in North Austin. They are one of several Austin companies that offer unlimited vacation. 

“One of the best ways to establish a great unlimited vacation policy is from the top down,” she said. “If the CEO is making sure to take time off themselves that will also trickle down.”  

Austin-based Bazaarvoice, which provides ratings and reviews software, takes steps to ensure that employees are taking time off. The company gives general guidance of three to four weeks off a year, and advises managers to work with their team members to encourage that they use it.  

"We have found relatively few if any employees take too many days," said Kathy Smith-Willman, senior director of people & talent. "The real question is 'Are our people actually taking the vacation?' We have to watch that."  

Some companies have launched and then ended unlimited vacation policies. Two years ago, Tribune Publishing ended its program after a just one week when employees protested.  After workers expressed fear that their vacation days were being taken away, the company went back to its long-standing policy of providing a fixed amount of vacation, floating holidays and sick days.

Meanwhile, Kickstarter ended its unlimited vacation policy last year after it determined that employees were taking fewer vacation days,  likely because there were no established guidelines on how much time off was acceptable to management.

A startup mentality

At fast-growing Indeed, which has 800 employees in Austin and is aggressively hiring, the move to unlimited vacation was part of an effort to maintain a startup environment, said Chris Hyams, Indeed's president.  

"As companies get bigger they tend to put more structure and command in place," Hyams said. "We believe the best way to handle that growth is to actually become more flexible than more rigid. As you get bigger, if you want to continue to innovate, you need to give more autonomy and decision making opportunities to everyone in the company."  

At first, some employees and managers were unsure of the program, which provides guidance of three to four weeks of vacation a year. But it has turned out to work far better than tracking hours, Hyams said.  

"People here work really hard, and the goal was to get them to take more vacation," Hyams said. "We have the ability for managers to track when their team is actually taking time off, and use that to have a discussion around when people should take time off."  

RALPH BARRERA/AMERICAN-STATESMAN STAFFSoftware company Bigcommerce offers unlimited vacation for its employees. 

At Bigcommerce, which makes e-commerce software, demand for unlimited vacation time came from employees. 

"We did a survey in 2013 to see what we could do to enhance benefits, and time off was a top thing they wanted to see," said Steve Donnelly, whose title at the company is "senior director of people."  

The company now offers unlimited time, starting immediately upon being hired, and gives guidance of three to five weeks per year.  

The program is what helped Bigcommerce recruit Eric Owens, a sales executive, to the company in May.  

Owens, who recently got married, needed to take two trips to California for wedding planning in June, plus time off for his wedding and honeymoon.  

"That they trusted me to take this time off right after starting said a lot to me," Owens said. "It showed there's not micro-managing here. When you have that kind of mutual respect and trust, it creates a motivated work environment where people want to be."

American-Statesman tech reporter Lilly Rockwell contributed to this report. 


About this series:

This is the first in a new 512tech series called Tech Perks, in which our reporters take you inside Austin's tech companies to highlight cultural trends and new approaches to working. To suggest companies and trends for the series, email Lori Hawkins at lhawkins@statesman.com, Lilly Rockwell at lrockwell@statesman.com or Omar Gallaga at ogallaga@statesman.com.

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