Pre-Cations

I was talking to a client last summer. He had just returned from an African safari. In talking about the trip, he mentioned that he'd been gone for two weeks and his staff told him he could never go away for that period of time again! Yes, we Americans think it's unusual to take a two-week vacation anymore, and that used to be the norm. During his trip, my client met Europeans who were taking month(s)-long holidays.

Richard Branson made news in September 2014 when he introduced the non-vacation policy at Virgin Group offices in the US and UK. His rationale for this non-policy is that employees will only take time off from their jobs when they feel comfortable that their being away will not hurt the business, the team, or their careers. He's hoping for an upward spike in morale, creativity, and productivity.

Motley Fool, which we wrote about last year, does not track time off, but allows their "fools" to take whatever time they need and trusts they will not abuse such a wonderfully foolish benefit. While Branson was inspired by Netflix, their policy is not unlimited vacation. Rather, like Motley Fool, Netflix doesn't monitor their employees' hours off, either at work or away from the office. For these companies, allegedly only results count.

HR Professional and blogger Tim Sackett (The Tim Sackett Project -- timsackett.com) has some interesting insights about Branson's decision. He notes with skepticism that no one is checking how much time is being used. He raises the valid point "What if you have some employees who are not using any vacation at all? Isn't that a problem? Shouldn't someone be checking on this?" Excellent point.

Two-week vacation policies, like so many time-off policies, had their roots in the industrial era. The factories shut down for two weeks to allow time for maintenance. All workers took their vacations at the same time. That practice seems almost absurd in today's information era. We have blurred the lines between work and home -- causing us to work more, not less. This results in requests for more flexibility. Whether or not you agree with Branson, Netflix, Motley Fool, and others with similar practices, one of the positive outcomes is that companies are exploring alternatives and innovating.

42Floors, a San Francisco-based commercial real estate search engine, implemented a "pre-cation" -- paid time off before starting work at the company. This began when a potential new employee was so haggard from his prior job that 42Floors wanted him to be refreshed and energized when he joined them. Another firm, Atlassian, does not track vacation days, per se, for its US-based employees, but was concerned when it was not seeing a significant uptick in the total amount of time workers were taking off. They too decided to offer a pre-cation giving new hires a travel voucher and encouraging them to take time off before they start working. After five years of service, Atlassian employees are asked to take another break and are given a $3,000 voucher toward the vacation of their dreams. Combined with other memorable perks and livable workspace, Atlassian enjoys attrition rates in the single digits.

When asked the cost of the pre-cation program for 42Floors, Jason Freedman, its CEO, says it is zero. He explains that the typical way to calculate it would be the total dollars spent on paid time off. However, he looks at the overall amount of vacation time in the company and wishes it were higher. His point: if you want the most from your associates, you have to show them that you care about their well-being. If you do, they'll reward you with passion and energy.

Will everyone agree with these provocative approaches and ways of measuring results? I can think of many CFOs who would cringe at Freedman's perspective. Will alternative policies guarantee you'll be able to attract the best and brightest talent? That depends on the type of talent and individuals you need for your successful organization. Will the above alternatives work in all organizations and industries? Of course not. One size does not fit all, so don't make the mistake of trying to force-fit something into your organization that won't work in your unique culture.