Unlimited Vacation Policies Don't Work. Here's What to Do Instead

People don’t take enough vacation time. Salespeople want unlimited vacation, but that type of policy doesn’t work either. How can you encourage a good amount of rest and relaxation for your busy, goal-driven sales team? Here’s what we learned from implementing and then scrapping an unlimited vacation policy here at Proposify and how you can create a sales team culture that respects the value of a little R&R.

There are two types of vacation people in this world.

(No, not Speedos vs. Board Shorts or Sun Visors vs. Big Floppy Hats.)

I’m talking about how people take vacations.

For example, it’s halfway through the year and I’ve already used 86% of my annual vacation allowance.

This stat would have driven a former coworker of mine nuts.

He worked in a sales job where he received commissions and bonuses. This work structure gave him entry into the company workaholics club. The first rule of workaholics club, apparently, is ‘use as little vacation time as possible’. This guy’s MO was to work without breaks and then get paid out at the end of the year for all his unused time off.

You won’t be surprised to hear that he couldn’t keep up that pace and eventually burned out.

Knowing this about him and the rest of the overworked salespeople at that company, I was surprised to see this data point pop up in the results of a recent sales compensation survey:

More than 80% of salespeople cited unlimited vacation as the coolest employee perk.

In that survey, salespeople said they wanted unlimited vacation more than any other benefit, including flex hours, office snacks, and gym memberships.

Why are salespeople longing for unlimited vacation policies in a world where some companies are literally paying people to take the little bit of time off they’ve been given? In a world where a ton of companies, Proposify included, have scrapped their unlimited policies in favour of good old-fashioned pre-set vacation allowances?

Let’s break down this vacation paradox, starting with what happened to our policy.

How great is unlimited vacation really?

Like many SaaS startups in the mid-20-teens, Proposify’s employee benefits package included an unlimited vacation policy.

The policy balanced the company’s stance on having an in-office, not remote, workforce. Unlimited time off would give everyone the flexibility to take a break when they needed it. Employees would be incentivized to stay productive when they were working.

Except that isn’t what happened.

An unlimited vacation policy allows employees to choose the amount of paid time off (PTO) they take. In some regions, companies must offer a minimum amount of PTO per year. Companies with an unlimited vacation policy just wouldn’t set a maximum for PTO.

A policy like this for Proposify seemed straightforward in theory. All the time off your employees could want! What could possibly go wrong?

A lot, it turns out.

With an unlimited vacation policy, employees at Proposify were unsure about how things worked when it came to being out of the office. They worried about looking like a slacker if they took too many days off but also about burning out if they took too few.

On the administrative side, there was minimal tracking of who was away, when, and for how long. It was difficult to make sure that each department had enough coverage and that projects progressed while employees were away.

It had become less of a vacation policy and more general ‘vacation nonsense’, as CEO and co-founder Kyle Racki refers to it in an episode of his LTV with Kyle Racki podcast about hiring an HR manager. And these PTO woes would likely only worsen as the company grew.

So, in late 2017, Proposify ditched its unlimited vacation policy in favour of a more traditional set amount of vacation time and created a standardized process for requesting and taking time off.

And we’re not alone in saying bon voyage to unlimited policies. While salespeople may consider unlimited vacation one of the coolest benefits around, it’s one of the least offered. Less than 10% of companies offer this perk, a number which doesn’t include organizations like Proposify that tried it out but ultimately decided it wasn’t a good fit.

There are many pros and cons to unlimited time off, especially for teams like sales where their work is extremely time-sensitive. Is there a way to give your team the perceived benefits of unlimited vacation WITHOUT putting yourself into the management and missed-quota weeds?

Why sales reps love companies with unlimited vacation

There are lots of possible answers for why salespeople might be enamoured with the concept of unlimited vacation, including:

• They see it as offering the flexibility to take more, but shorter, vacations each year (like making long weekends in the summer by taking Friday and/or Monday off).
• They use it as a motivator to work harder and hit targets quickly before each vacation so they can go away guilt-free.
• They’re planning on working during their vacations anyway.

That last one is important.

If your salesperson is checking their email poolside every few minutes or leaving dinner early to make a couple of ‘quick’ calls, did they even go on vacation?

With this approach, sales reps could return to the office more fatigued than when they left. This type of burn-out risk is why companies are starting to envision a bigger role for themselves in their employees’ time-off planning.

Some enforce a minimum amount of vacation that must be used each year or offer a bonus to those who take time away. Others are helping employees save up for trips, while a few companies are experimenting with straight-up giving their team members money specifically to spend on rest and relaxation.

If these more extreme vacation policies don’t float your banana boat, how can you help your sales team unplug and chill out without losing sight of your goals?

How to help your sales team unplug and de-stress while still hitting targets

The stress around taking a vacation can be almost as detrimental to your sales team’s well-being as not taking any time off at all. 

Unclear or misunderstood processes and policies around how your team members use their vacation days can lead to no one taking a proper break.

Here are five ways you can help your salespeople take advantage of a chance to relax:

1. Set the right tone
2. Find more motivators that aren’t money-related
3. Get them to see the bigger picture
4. Create a departmental vacation plan
5. Establish a positive and collaborative sales environment

Set the right tone

Do as I say, not as I do isn’t a great way to lead your sales team when it comes to taking breaks.

You set the tone for your team. If you’re on the clock 24/7, your sales team will feel as though they need to follow suit. Nobody will take you seriously if you encourage your salespeople to use their vacation time and then don’t bother to heed your own advice.

Be clear about your expectations around work-life balance and set a good example for the team by establishing healthy boundaries between your work and personal life.

Help your sales reps find more motivators that aren’t money-related

Targets and quotas are needed, but they aren’t everything. Personal goals, including achieving an ideal work-life balance, are great motivation, too. Putting an emphasis on health and well-being will help your sales team feel good about taking time away, instead of avoiding it or working through it.

If your salespeople are laser-focused on their bottom line, though, there are research-backed reasons for taking vacations, including how it positively affects your paycheque. One study found that people who took more than 10 days of vacation per year were 30% more likely to receive a raise or bonus.

Get your sales team to see the bigger picture

Opportunities can feel like they’re now-or-never. Which is why you have sales reps taking calls and responding to emails at all hours and in the oddest places.

Sometimes, the situation is time-sensitive. Other times, it could wait. Knowing the difference has a big impact on sales rep burn-out rates.

Many salespeople who want to stay connected to what’s going on with their work during vacation set clear expectations and boundaries. Their out-of-office (OOO) message states that the rep is away and therefore response time will be slowed. The OOO message directs urgent issues to another colleague.

The salesperson can then batch their catch-up into one session, maybe first thing in the morning or last thing at night as they start or end each vacation day. They can quickly scan their inboxes for anything that needs immediate attention and then choose whether to respond to the rest or leave it until their return.

Create a departmental vacation plan

Those who fail to plan plan to fail. It’s a well-used phrase because it’s true.

A pre-set vacation policy for what happens when a team member takes a vacation will help ease some of the stress leading up to and after their time off. That way they can fully unplug knowing that their pipeline won’t freeze up while they’re gone.

A few questions to ask when setting up a policy:

• How far in advance should your sales team schedule their vacations?
• How much will sales reps be responsible for doing before they go and what will be delegated to other team members?
• What information do you need from them before they leave? (For example, where active deals are in the pipeline, any potential issues to watch for, and who is covering what for them.)

This groundwork is important because poorly planned vacations can negate the positive effects of the time spent away. On the flip side, 94% of vacations that include proper preparation have a good ROI in terms of energy and outlook when the employee returns.

Establish a positive and collaborative environment

Company culture is the most important factor for salespeople in selecting a job. To help your team feel good about using their vacation time, make sure that your team’s culture is positive and collaborative.

Sales reps who work in a cut-throat environment won’t be eager to step up and help out a vacationing colleague, which could lead to people feeling like they can’t take breaks.

A team that has each other’s backs isn’t going to be bitter about picking up any slack for a vacationing peer. Enable your sales reps to support each other through balanced competition and team-based goals.

Conclusion

When Proposify’s unlimited time off policy switched to a generous set amount of vacation, something unexpected happened.

Not one person was upset about it.

The thing is, unlimited vacation is a cool perk… in theory. In practice, most companies end up preferring a more traditional approach.

That’s what happened here. My colleagues and I are happy to know what’s expected of us, vacation-wise. Departments aren’t scrambling to cover unanticipated absences anymore. And clear processes make it easy for the leadership team to ensure that everyone is using the vacation time they’re allotted and taking proper breaks.

So, on that note, see you at the beach! I’ll leave my laptop at the office, though.