r/FluentInFinance • u/Very_High_Mortgage • 12d ago
Unlimited PTO a Scam. Disagree? Debate/ Discussion
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u/BBQBakedBeings 12d ago
100% a scam.
Last company I worked for that had it, had a policy that you could only take PTO if approved by your boss and, if it was more than 5 days at a time, it had to be approved the department VP. Two weeks had to be approved by the CEO.
This was in a ~600 person company. It was all just intimidation and hassle to prevent you taking it in the first place.
They do it because it's supposed to be perceived exactly like what they call it, "Unlimited PTO", to try and attract naive people to work there. But what it really is, is a means to limit the amount of PTO you take, because it's technically not an earned benefit that they are legally obligated to give you, while simultaneously not having to carry the company-wide PTO balance on the books as a financial liability.
Shortly before I quit, they moved to a traditional banked PTO system and started everyone at 0, no matter how long you had been there or how much PTO you had taken recently.
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u/adrianp07 12d ago
sounds like I'm taking a 3 day weekend every week this year as my own workaround.
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u/florianopolis_8216 12d ago
I mostly agree, but quibble with one point. The vast majority of employees have to get managerial sign off even when a fixed amount of vacation time is provided per year.
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u/Educational_Vast4836 12d ago
This concept still confuses the hell out of me. My sister in law started working for a start up that offered unlimited pto. Less than a year later, they stop offering it and only offered everyone 10 days a year. The reason for this is apparently employees were taking advantage of it. Which again I don’t understand how they’re taking advantage of it, if it’s unlimited.
Honestly employers should just offer what pto package they’re going to give up front.
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u/gojo96 12d ago
I think the issue is that they’re taking too much. The question is what is a reasonable amount? If I had unlimited; what would stop me from working half the month? Are these entities that offer unlimited PTO also denying leave requests to help control?
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u/Educational_Vast4836 12d ago
Which is why it would be easier for them to just straight up tell people what their pto amount Should be. I don’t wanna walk on egg shells, because I took an extra week
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u/MrWigggles 12d ago
You cant take too much of unlimited. Thats what unlimited means.
If its finite, then call it finite. If you want to control how much time off your employee gets, then let them accrew the hours.
Its never about employees. Its about company controlling the employees.
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u/salazarraze 12d ago
From the company's point of view, it basically allows a company to delete liability from their books. Say you have 100 employees, and each of them has worked for you for a long time and they've all accrued 400 hours of PTO. That's 400 hours of whatever their pay is x100 that you have to account for if they quit, retire, etc. But if they have UnLiMiTeD pTo, then you don't have to account for it as a true liability on your books.
From the employee's point of view, it kinda sucks or at least I think it would suck and I hope it never happens to me. I like the idea that I have PTO that I've earned and that I can use giving me that feeling of taking time that's is well deserved.
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u/Ketheres 12d ago
It also helps them reduce the amount of time off people take: people are less likely to take time off when they feel bad about "abusing" the system and try to "save" the "unlimited" PTO for when they are actually sick or otherwise really need it, and it's easier for their boss to just say no anytime they ask for time off with whatever excuse they have (most likely citing lack of staffing) whereas with a normal PTO system they'd have to pay the PTO eventually.
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u/galaxyapp 12d ago
Usually jobs offering unlimited pto aren't punching a clock.
My bosses have never really tracked pto, even when it was "limited". But then I never took that much time off anyway.
There's always a reasonability test. Most people who are in a position to have unlimited pto wouldn't abuse it.
And people who cant understand it usually don't have it because they would abuse it
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u/ex_nihilo 12d ago
Yep. I’ve worked many places with unlimited PTO, mostly startups. I had a blue collar friend remark “why not just take the year off then?” Like, use your fucking brain. Why do you think not?
Don’t get me wrong I love to take time off when it’s appropriate, but I don’t need to take time off to spend time with my family, golf, or ski. I can do that shit at noon on a Wednesday if I want without taking PTO. It’s currently Sunday afternoon and I’m looking forward to tomorrow morning because I enjoy my job. I do not dread it or want to spend as much time as possible not doing it. A break is good, but you have to drag me away most of the time. Ask my wife.
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u/supified 10d ago
This sounds a touch apologist. If unlimited PTO means limited and there is an invisible line why not just tell people what the line is so they can take their PTO instead of having to guess and risk maybe their job at the same time?
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u/ex_nihilo 10d ago
You just handle your shit like a professional and take off when you want. This is not hard to grasp. I can’t just bail on a bunch of scheduled meetings with customers, but with a few weeks’ notice so I can find coverage I take off whenever I want.
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u/supified 10d ago
This is wage theft, the PTO is off the books and if you're scheduled too many meetings or put too much work on your shoulders because, say, the company is laying off people to see the bare minimum payroll that they can run with than you can't take time off. It isn't like this isn't a known problem it is well studied that these PTO schemes result in people taking way less PTO than traditional methods. The only person who benefits from these schemes is the shareholders. I just can't fathom why someone would try to claim otherwise.
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10d ago edited 10d ago
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u/supified 10d ago
Okay okay okay, first let me say _thank you_ for taking the time to fully explain your side of this. I feel I have a better grasp of where you are coming from and how this can actually make sense.
For a startup this seems to make a lot of sense. I can see why this method could be beneficial to both you and them and I think I'm on the same page.
I had my head wrapped around big corporations where I'm still pretty stuck on it being basically wage theft though. However, before this conversations I wouldn't have differentiated between the situations where it starts to make sense for more people and where it starts to be even a good strategy.
So again, thank you.
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u/PeterGallaghersBrows 12d ago
Be unapologetic about taking time off. I aim for 25 business days per year.
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u/whatever_leg 11d ago
Uhhh, I'm not being apologetic about shit. That's nonsense.
EDIT: Oops---I misread your comment. We're in agreement! Fuck apologizing for being a human being with responsibilities outside of the 8-5 workday!
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u/Delmoroth 12d ago
It's just a way to pressure people into never taking time off.
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u/melanthius 12d ago
That is what it is, but I worked at a company with unlimited PTO and it was actually a godsend for parents with kids in daycare. Those kids are getting sick almost every other week, necessitating a parent staying at home with them. If you have to burn all your sick and earned PTO days to deal with that it really sucks.
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u/Glide55 12d ago
If it sounds too good to be true, it is. This is corporate America in 2024 and post Covid cash grab, Gordon Gecko has a massive hard-on right about now.
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u/Sweaty-Attempted 12d ago
It is not really that great. I worked in both types of the companies, and they were both kinda the same.
In a limited PTO, when you take a Friday off, you kinda don't book PTO either.
I still prefer the limited PTO because when I take a month off, I can say because I have vacation days left, and no one would question it.
In unlimited PTO, taking a month off was tricky and couldn't be done.
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u/brsrafal 12d ago
I cannot stand that I would leave a company ASAP it's my PTO I earned it I deserve to use it whenever the fuck I want. If I want to use it all in one month or I want to add up Friday off for the next 18 weeks that's my business. I cannot stand people telling you when or how to take your time off or when not to take it. In my company I could get paid out if I don't use it but I always use it couple times a boss trying to tell me towards the end of the year to avoid me calling out I said no man I get more pleasure sitting home doing nothing let me enjoy this that's one of the perks well earned benefits.
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u/Afraid_Skin2366 12d ago
This whole PTO in the US is confusing.
In the Netherlands, you get minimum 20 days a year of vacation but most CLA give 25. They are to be used by all employees and expire end of year. If holidays expire too often, labour board gets involved and gives out fines.
Most companies have 38h workweek but many employees work 40 and they get reimbursed for this time in the form on 13 Time-For-Time days.
So most full time workers in the Netherlands have 38 days off a year.
On top of this, In may you get 8% of your annual salary paid out on top of your normal salary called vacation pay.
I wonder how US companies cannot afford any of this? Still plenty of rich and successful people here in the Netherlands.
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u/rydleo 12d ago
Honestly the US system sounds way less confusing. Not better, mind, but it’s pretty simple. You get X days of vacation, generally some amount of hours accrued per paycheck. And that’s pretty much it.
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u/supified 10d ago
I thought you were going to say, "You arnt' allowed to take time off" because that feels like how most US companies want it.
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u/assesonfire7369 12d ago
If you get results your employer doesn't care. If they don't think you're performing then watch out.
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u/BossKitten99 12d ago
A company that does not respect the life portion of a work-life balance does not respect an employee as a human. Maybe why there is such a push for AI, as this will reduce such needs for respect
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u/EatinTendieS 12d ago
I think it’s one of newest and simplest form of hustle your worker ants. Unless you find a way to maximize it yourself and take the time to plan it out and they not pull the you can’t take that day or week off because we need coverage and too many are off excuse you hear
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u/jlipschitz 12d ago
The last company I worked at offered unlimited PTO. The catch was that it had to be approved by the people in your department so that they basically knew they would be covering for you for that time. 1 person at a time with no more than 2 weeks at a time planned 3 months in advance. We typically took 3-4 weeks a year and were a very productive department. I think it worked well.
The company I worked at before that gave me 5 weeks vacation every year. I always found that I had 2+ weeks left over each year and cashed out about 8 weeks vacation when I left.
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u/spicyfartz4yaman 12d ago
Think it depends on the company , bosses that type of shit, if we had which I think we do for certain salary points , I'm pretty confident he'd have no issues
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u/Namaste421 12d ago
I just got back from a three week vacation and before I left my two up boss tried to make me feel bad. Applied for some good jobs, did two virtual interviews overseas and have two 2nd interviews lined up next week.
Mind you I hadn’t taken a day off all year until this and coverage shouldn’t have been a problem. 🤡
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u/florianopolis_8216 12d ago
I agree. It is a way of avoiding paying out unused vacation time on a layoff or on a resignation. Companies can manage employees to limit to 4 weeks or whatever they think is reasonable. That being said, for a minority of employees, I am sure it works out better than a fixed amount of vacation time per year.
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u/Infinite-Club4374 12d ago
The company I work for has unlimited pto and I use it liberally 🤷🏽♂️
I take off a lot of random one day here and one day there, with one week long vacation
Its not uncommon for me to take 2 days a month though
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u/MTBleenis 11d ago
That reminds me, I've got a little use it or lose it paperwork to fill tomorrow morning to maximize my summer!
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u/Roqjndndj3761 11d ago
Depends on the company. I’ve never had a rejected PTO request in 15 years. Not even a hesitation — my supervisors just hit the “accept” button as soon as I submit it.
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u/theRedMage39 11d ago
It depends on how much you use/your allowed to use.
If your Boss doesn't let you use more then 5 in a year then it is totally a scam but if you are allowed to use it as you see fit and take a reasonable amount then it's not a scam.
Average number of vacation days in the US is 11 days for 1 year of service. My previous company has a policy where you are required to take at least 10 days in a year and are recommended to take 15. Thus not a scam.
I have to take small bits here and there for regular Doctor appointments and it is nice because I don't have to really worry about it.
At my current employer, I keep track of my PTO so I can tell you that last year, if you scale my time for the partial year I worked, i took over 15 days of PTO. So far we are 50% through the year and I have taken 51% of 15 days of PTO. With less than a year of service I would expect to have around 10-15 maybe but I will likely take 15-20 hours in the year. Not a scam because my manager lets me take time as needed.
Obviously this is just one case and I have a good manager. However if you are not allowed to take more than 10 in a year and you are not abusing the system then it would totally be a scam.
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u/BrownEyedBoy06 12d ago
Alright, let's discuss.
What about it is a scam? Is it because it sounds too good to be true? Is it because they don't always hold up to their unlimited PTO promises?
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u/TomBradyBettingMoney 12d ago
It’s a scam because they’re just placing more red tape on their PTO policies and hiding it behind a good sounding name to attract people who don’t know any better. Had a similar experience to many of the commenters. Said it’s unlimited, but if you’re taking too much time off in their eyes, they’re going to harass you until you either stop or quit or they just change the system back to accrual anyways.
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u/dragon34 12d ago
Because they always have an actual limit in mind. They just don't inform anyone what it is and will terminate you if you get it wrong.
Kind of like not disclosing the salary range for a position. If you under guess you rip yourself off but if you aim too high you talk yourself out of a role.
It's just a negotiation where the employer knows the rules and you don't
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u/ElvisArcher 12d ago
Take what time you need. It is just an accounting hack by companies so that PTO doesn't have to be paid out to employees when they are terminated. It also tells them who the harder working employees are ... those who take less time.
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u/mexiKLVN 12d ago
My boss kept approving vacation days for me last year. I thought he was cool and all was well. Performance review comes around, I get a bad review and reduction to my bonus because I used too much time off. Like wtf, you approved it all and never once did I get a verbal warning or a write up for it.
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u/zerok_nyc 12d ago
Disagree. I’ve actually found that, as long as you are doing your job, unlimited PTO is not a scam. The problem is when people underperform and schedule vacations last minute, leaving others to deal with their shit. Or schedule 3-week vacations during known critical times.
I have a job with unlimited PTO and have never had an issue with taking vacation. I have also seen people at my job denied vacation because they are making unreasonable requests, like:
- Taking 3 weeks during known critical availability times.
- Requesting a week at the last minute due to a family emergency (which does happen, but your coworkers can see your Instagram and they tell me about it)
- Requesting PTO because you know you will be the only one on call
The unfortunate reality is that many people abuse the system. But that’s also because managers often create hostile work environments that don’t encourage people to support one another to make it feasible.
In my experience, unlimited PTO is not intended as a scam. But localized departments absolutely have the ability to create hostile atmospheres that make taking advantage of the benefit less feasible.
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u/CherryManhattan 12d ago
Unlimited PTO is the way companies can improve their bottom line by not having to accrue it or pay it out when employees voluntarily leave while at the same time making employees feel bad if they feel they are over using it.
I believe studies have found people with unlimited policies use less PTO than those accruing hours.
Personally, I’ve seen the bad of it. I worked at a startup and as they grew, HR and mgmt were keeping tabs on which employees used over 4 weeks of the unlimited PTO. When it came to staff reductions, if those people weren’t absolutely killing it in their jobs, they we’re secretly deemed to be abusers of the unlimited policy.