Why unlimited leave is a winning idea for SA companies – Colin Browne

Unlimited leave sits at what may the perfect intersection of culture and financial responsibility …

When Netflix famously scrapped its employee leave structures back in 2010, it appeared to throw down a gauntlet to other companies with similar 24/7 work structures. Being an Internet business, CEO Reed Hastings argued, the company’s employees would often be called on to solve a customer problem late at night or over a weekend, which created a contradiction. If the company couldn’t fully measure the time employees spent on the job, it felt imbalanced to measure the time they took off. This is, after all, an organization that touts its ‘Freedom and Responsibility’ culture.

Netflix wasn’t first to the idea however. IBM has given its employees full discretion over when they take leave for years. LinkedIn, Evernote and many other companies have fiddled with the same concept, though with variable results. The Los Angeles Times rescinded its policy when employees threatened to sue over the financial loss they would incur through that company’s decoupling of leave days and their monetary value.

Fast forward a few years and the notion of unlimited leave was given what is often perceived as the ultimate stamp of entrepreneurial approval when Richard Branson announced it in a blog post, saying: “It is left to the employee alone to decide if and when he or she feels like taking a few hours, a day, a week or a month off, the assumption being that they are only going to do it when they feel a hundred percent comfortable that they and their team are up to date on every project and that their absence will not in any way damage the business, or, for that matter, their careers.”

Of course there are two sides to this coin. German tech firm Travis CI pulled its nascent unlimited leave policy this year when it discovered that it was having the opposite of the intended effect. In a blog post to employees, it said: “When people are uncertain about how many days it’s okay to take off, you’ll see curious things happen. People will hesitate to take a vacation day as they don’t want to seem like that person who’s taking the most vacation days. It’s a race to the bottom instead of a race toward a rested and happy team.”

That’s a strong counter-argument. IBM also says it saw a decline in the number of days employees actually took when it was down to them to decide. It makes the case perhaps, for a minimum number of set days to prevent employees feeling trapped and burning out.

As always, it’s probably horses for courses. Companies that make it work are probably culturally inclined toward more independent thinking and autonomous action. Companies that are not, will probably struggle to pull it of.

But what about South Africa? Is this a concept that warrants investigation by South African companies, or is it just another crazy first world idea?

Well actually, in the inaugural Happy Sandpit Culture Club Round Table, last week, the business case for it is almost crystal clear. South African companies are bound to offer a statutory minimum of 15 leave days per year, and with every additional year worked and promotion earned, employees gain another day here and there until the number of days available to them is often more than they could reasonably take and expect to stay on top of their work. Since a portion of untaken leave is often carried over, that saddles most companies with a sizeable number on their balance sheets in provisioning.

The current leave limitation, may be the fundamental reason for that financial challenge. As an employee, I choose not to take off this Friday for a long weekend because I worry that it won’t have enough leave days for the December holidays.. When I don’t end up going away as long as I expected in December, my excess days carry over.

In an unlimited leave scenario however, leave allocation could be treated similar to the annual threshold limit offered by medical aid schemes: you may take as many days as you like, but the first 15 are the statutory, monetized days employers are obliged to offer.

With an insurance policy of knowing they can take extra days off should they want them or need them, would employees be more inclined to take those 15 days that you’re otherwise obliged to provision for? In choosing whether to consider this, perhaps that’s the question employers should ask.

Unlimited leave, far from being a cutting-edge philosophy for adventurous companies, could be the perfect intersection of culture and profit that companies are looking for.

Scroll Up