Rise Performance Group

Is Unlimited Vacation the Secret to Extreme Employee Productivity?

By Aoife Gorey

What is the vacation/time off policy in your organization? Do you work a 9 to 5? Many organizations today have become quite creative and trusting when developing their vacation policies. Netflix, IBM and Hubspot are just some of the well-known names that boast an unlimited vacation policy.

For those of you that don’t know Hubspot, you’re missing out. They are an all-in-one marketing software company that helps more than 6,000 companies in 45 countries attract leads and convert them into customers.

They have had their unlimited vacation policy in place for over two years and since then, the company has been ranked as the #2 fastest-growing software company on the Inc. 500 list. They were recently awarded the 17th place on Forbes America’s Most Promising Companies.

According to Hubspot CTO Dharmesh Shah, Hubspot doesn’t track anyone’s time off, so it’s hard to know if the policy makes people more or less wary of taking vacation. “One thing we are pretty sure about is that it’s a less stressful way to manage it,” he says. Rather than hoard days for times when they really need it, then scramble to take days at the end of the year (or fight for extra pay for time not taken), Shah says Hubspot’s open, unlimited vacation policy makes all of these problems go away. “Employees take the vacation when they need it and we don’t have a spike of vacations at specific points of time,” he explains.

We were very intrigued by their policies, so we reached out to David Fernandez, Specialist and Inbound Marketer at Hubspot with some interview questions.

So unlimited vacation time, is it really ‘unlimited’? What is in the fine print?
DF: Yes, it is actually.  The fine print really resides in what we call our time off policy: “Use Good Judgement”.

What is the reasoning behind the policy, to instill trust and promote productivity?
DF: Yes to both.  At HubSpot we believe we’re in a knowledge economy where instead of measuring productivity with an inaccurate proxy, such as how much time you spend at your desk or in the building, we choose to measure productivity based on the goal of your functional area and skill set.  An easy example is sales.  In sales, we measure a HubSpotter’s success by their achievement or over-achievement of their quota and not by when they got to the office or left for the day.

Do many people take advantage of it?
DF: Every HubSpotter I know uses their unlimited paid-time off in different ways.  For example, some of my friends in sales set individual goals that only they track wherein, if they reach 85% of their quota by a certain date (usually early in the month) they promise themselves a long weekend following that achievement.  And that is just one creative example of how HubSpotter’s “Use Good Judgment”, there are other creative ways to achieve success at your job and take much deserved time off!

Do people still choose to work 9-5 hours?
DF: Yes. A lot of HubSpotter’s like to plan their work to fit into the more common 9 – 5 routine.  Still others work from home on days of the week when the commute is typically worse.

Is there an average amount of days your employees take? Do you know this number?
DF: I don’t think we have calculated this number yet.

What is too much vacation? Realistically, if an employee worked 50% of the time in office but got their job done, would this be a problem?
DF: In my personal opinion too much time off would simply mean that you cannot achieve or overachieve your goals.  In fact, I can think of two people who work from home 50% of the time or more but who are both overachievers, one of whom has been a HubSpotter since 2007.

Can you outline some positives/negatives associated with the policy?
DF:
Positives: 

  • Employees get to focus on what really matters to them the work
  • Managers get to focus on what really matters to them: the results
  • One less cog in the all too familiar micromanagement machine model of today’s workplaces
  • When you have the right people working for you, trust fosters productivity

Negatives:

  • It can be hard to get used to making your own schedule if you haven’t done it before
  • Working from home: has its own challenges too

Since HubSpot implemented the policy, the company has been ranked as the #2 fastest-growing software company on Inc. 500. That’s pretty impressive. Does the vacation policy play a big role in aiding this success?
DF:My personal opinion is that it does.  As an employee, simply knowing that you won’t get hassled for time off and that you are trusted to take the time when you need it is empowering.

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I’m sure that there are many factors contributing to their remarkable success and highly productive employees, unlimited vacation being one of those, but whatever Hubspot is doing, it is surely working!

So what do you think? As a manager, would you trust your employees to “Use Good Judgement” like Hubspot does? As an employee, would you take advantage of unlimited vacation time?

 

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