A motivated and engaged employee is the biggest asset of an organisation. That's why businesses keep coming up with various innovative policies to keep their employees happy and productive.
One such innovative policy that has proven beneficial for several companies is an open leave policy.
Also termed an Unlimited Vacation Policy, an open leave policy allows employees the flexibility to take as many leaves as they wish, whenever they want, provided the job is done. The policy focuses on improving employee productivity and results per employee rather than counting their working hours.
Many organisations favour an open leave policy because it promotes a sense of ownership and makes employees think like the owners and decide what is best for them and the firm.
Organisations that have been following an unlimited leave policy have seen positive results. For instance, Ask.com claims that its unlimited leave policy helped the company save 52 HR hours every year, which are now used for recruitment and retention. Salesfusion states that some of its 72 employees were uncertain about how much vacation is too much and, hence, took fewer leaves.
Like any new policy, an open leave policy or an unlimited vacation policy comes with both negative and positive consequences.
Pros of Open Leave Policy
Increased productivity
An unlimited vacation policy, if implemented well, increases employees' productivity. Many employees use the vacation time to manage various aspects of their life, such as attending weddings, meeting friends, visiting doctors, and getting other personal work done instead of purely going on vacation.
A flexible leave policy gives employees the freedom to take care of their personal, health, and family matters without sacrificing the time to take some vacations purely for entertainment and rejuvenation a few times a year.
Employers get a more productive and engaged workforce because the employees aren't overworked or burned out.
Easier to hire top talent
Having an unlimited vacation policy helps attract the best talent from the market in the company. Employees would prefer working with companies where they can take any number of leaves whenever they want and never miss any special occasion of their life.
It can also increase employee retention as employees are likely to stay associated with the firm offering such benefits.
Cons of Open Leave Policy
Overlapping vacations
One of the most significant concerns of an open leave policy is vacation overlap and the employees' unavailability. Multiple employees may end up taking vacations at the same time.
The only way is to inform management beforehand regarding the leaves and coordinate with your manager to prevent vacation overlap. The HR department should avoid planning leaves irrespective of whether the number of leaves is limited.
Unclear expectations
Though unlimited leaves are for employee benefits, having unclear expectations regarding how many leaves they can take and scheduling them can prove stressful. This may result in employees not opting for the open leaves policy.
Furthermore, manager expectations also need to be clear; an open leave policy does not mean allowing leaves to the employees for the entire month. Careful tracking and management of leaves become essential in an unlimited or open leave policy.
Open to misuse
There are chances that employees may misuse the policy. There are also chances that employees may take more than required leaves that, in turn, will hamper the smooth functioning and performance of the firm.
(Samira Rao, Co-founder, Finjinn, a leading unified application for payroll solutions)