What is unlimited PTO and how does it work?

Unlimited PTO (also called flexible PTO or discretionary time off) removes the traditional cap on paid time off. **How It Works:** - No set number of vacation days - Employees request time off as needed - Approval based on workload and coverage - No accrual tracking required **Pros:** - Attracts talent, especially younger workers - Eliminates accrual liability on books - No payout required at termination - Reduces administrative burden **Cons:** - Employees often take LESS time (studies show ~13 days vs 15 days traditional) - Ambiguity creates guilt about taking time - Managers may inconsistently approve time - May not comply with state sick leave laws **Best Practices:** - Set minimum days off (e.g., "at least 15 days") - Track time off even if unlimited - Lead by example - managers should take time - Create clear approval process Research shows unlimited PTO works best in high-trust, results-oriented cultures.