Want Unlimited Vacation? First Get Your Culture Right.

LinkedIn is the latest employer to offer what’s known as “discretionary time off,” or “DTO” in corporate HR-speak. Starting on Nov. 1, LinkedIn’s approximately 6,000 U.S. employees will be able to take as much time off as they want every year. There are a few guidelines, but for the most part, it is what it sounds like. Why would anyone do this?

The purpose of DTO is to encourage empowerment, engagement, reduce burnout, and focus more on results than hours worked. Opponents say that DTO actually has the opposite effect, people work more and are too self-conscious to take time off. Americans aren’t good at taking time off. Only about 40% of available vacation time for U.S. workers gets used, according to one survey by the U.S. Travel Association.

LinkedIn joins a small number employers with similar policies, including General Electric Co., Netflix and Virgin Group. Still, unlimited vacation is a pretty rare policy. Only about 1 percent of employers offer it, reports the Society for Human Resource Management (SHRM).

At Next Element we have an unlimited vacation policy, and we’ve learned that for it to work, several conditions must be present in our work culture.

Confident and empowered employees

Unless employees feel confident in themselves, their abilities, and their dignity, it’s not likely that they will take advantage of this benefit. Taking time off is an act of self-care and boundary-setting that requires confidence and assertiveness.

Skill with difficult performance conversations

With DTO, the focus is on performance and results, not time spent in the office or specifics of how we get our work done. Therefore, performance conversations are strictly focused on deliverables. The main question is, “Did you do what you were supposed to do, when you were supposed to do it, in a way that adds value to our company?” If the answer is yes, we are good. If not, let’s talk.

Clarity about capacity and deliverables

Without crystal clear understanding of the deliverables, employees can’t make informed decisions about when and how much time to take off. Without an equally clear understanding of capacity to produce, it’s impossible for leaders to evaluate what is reasonable to expect from employees.

Collaborative work environment

Wherever DTO is in place, employees must coordinate to cover for each other when needed, make sure the customer is served, and that ball doesn’t get dropped on mission-critical priorities. This requires a highly collaborative culture.

Mutual trust

Leaders and employees must not only trust each others’ intentions, but also trust their ability to execute on those intentions. Both must be overt, regularly discussed, and adjusted as needed.

Is DTO right for your company? SHRM has some helpful tips. Whether you limit vacation or not, these cultural drivers will improve productivity, morale, and wellness of all employees.

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