Unlimited leave could end up as less leave

Meant as a perk to attract talent, the policy works only if trust underpins the organisational culture and practices.

If you're one of the few slogging away in the office in Singapore while the rest of your colleagues jet off for their overseas vacations, you're not alone. Most of us would have spent the year saving precious leave days just so we can take off for that long holiday with the kids, the other half or friends, and finally enjoy a two-week break from this horrid, work-dominated existence.

Yet, for a growing group of professionals, this need to "save" leave has disappeared ever since their company adopted an unlimited leave policy. For them, Christmas has come early.

From Goldman Sachs to Dropbox, Salesforce and Netflix, big firms around the world are offering unlimited leave to employees among a slew of benefits in the war for talent. On job boards like Indeed, many local small and medium-sized enterprises in Singapore are also advertising jobs with "unlimited paid time off" in sales, operations and data roles.

Others are getting creative and dishing out four-day work weeks, no-meeting Fridays and wear-anything dress codes to showcase their employee-friendly credentials.

And why not, when research shows such perks can create happier, more engaged and productive staff, which creates fewer human resources headaches. Unlimited leave also gives talent in the most demanding sectors like finance, consultancy and tech - whose careers are premised on being available to clients and teams 24/7 - more breathing space and tackles burnout.

Or so the theory goes. But in reality, although unlimited leave gives the impression employees have more degrees of freedom, the imposition of stringent rules can make it restrictive, even prohibitive, research by worklife researcher Jessica de Bloom shows. Such rules include curbs on the maximum number of days one can take at a stretch, requiring an immediate supervisor's approval or being subject to workload demands.

Perhaps this is why only 9 per cent of all US companies offer this perk, according to Fortune magazine. Unlimited leave not all it's hyped up to be

The problem with unlimited leave is that people might end up taking far fewer days off. Research in 2017 by human resources platform Namely shows people took two fewer days on average on an unlimited leave policy compared with when they had a fixed number of leave days each year.

Why does this happen? It starts with a growing sense of social obligation, when leave is seen as a favour from the boss requiring a quid pro quo, according to Dr de Bloom.

Guilt and uncertainty over the "market rate" for the average days a year an employee can take "legitimately" can create a wait-and-see approach where people avoid taking leave, so they don't have to wrangle with managers. Worse, this lack of guidelines can create a potentially toxic situation where immediate supervisors and teammates exert pressure on workers to minimise taking leave.

Even if unintended, management too may have unrealistic expectations of the working hours, intensity and performance an employee has to clock in return.

The poor professional then ends up taking a day here or there only when he or she can afford to sneak in time off. Even then, they can't help feeling bad, as if they've trespassed on some rule and have selfishly chosen to saddle their team members with work as a result.

All this can lead to a caustic conflict between work and private life, more hours worked and fewer days of leave taken. No wonder, then, some see unlimited leave as a ploy to legitimise the blurring of lines between holidays and work and reinforce an always-on culture.

It's a shame, when unlimited leave holds much potential in giving employees greater autonomy and ownership of work.

Even paid leave today in Singapore offers far too few days for time-strapped workers in smaller families with greater household responsibilities - whether caring for aged parents with huge healthcare needs or small children constantly catching the sniffles. Most Singaporeans used to expending annual leave to attend to such duties could benefit from an unlimited leave policy when they simply need a few hours off to attend to their situation.

People should also have the space for downtime and separation from work - for physical and psychological rest.

Research in occupational health, particularly by organisational psychologist Sabine Sonnentag from the University of Mannheim, documents the benefits of mentally detaching from the stresses associated with one's job. Taking leave from work activates psychological and biological recovery systems that help us achieve well-being, she says, which, in turn, helps us to get into the flow when we return to work.

All this should be good news to corporate bosses. They stand to gain significantly if a policy of unlimited leave fosters a culture of empowerment where high-performers are trusted to deliver on their goals, determine how best to use their skills, and do right by the company. A strong sense of ownership has been consistently linked to positive on-the-job outcomes like satisfaction, engagement, productivity, and commitment to one's employer, as well as retention and recruitment success.

But unlimited leave is not a policy for every company - and definitely not for the majority of blue-collared work with operational front-line service roles requiring adherence to schedules, like nursing, public transport and government services.

For others, unlimited leave has to be accompanied by strong supporting structures and guidelines that articulate how performance will be appraised to ensure equity and a level playing field.

Organisations with clear performance standards that removed the need for face time enjoyed a boost in productivity of up to 51 per cent and appeared three times more attractive to high performers, according to research by public policy researcher Bao Jiayi at the University of North Carolina.

Although many employers are concerned about the moral hazards of giving employees free rein, she found that slacking off behaviours - surfing social media while at work, taking extended breaks and more - was almost halved with the introduction of unlimited leave.

Human resources and management must outline explicit expectations on leave-taking, clear lines of responsibilities and communication protocols between supervisors and team members to ensure absences don't lead to busted deadlines and work falling in between the cracks. This is especially important when inducting new people into the company. Familiarising new hires, assigning them buddies who can advise on company practices and culture, and involving team members in the onboarding process can be good practices to follow.

Leaders too can set an organisational example by taking leave and demonstrating that people can take time off once they've put in the hours and achieved targets. Better still if leaders pay special attention to whether people do actually take leave, spot overworking, understaffing or underperformance, and find ways to empower managers in manpower planning.

One last thing for perspective: There's a special reason why many Americans dig the idea of unlimited leave and why the concept is gaining traction and stirring discussions. Although a recent Harris Poll for Fortune magazine reported half of US workers preferring unlimited leave to earning a higher salary, this is a country where 26 per cent of the workforce do not have paid leave and those who do average eight days a year. Compare that with Singapore, where people are entitled to paid annual leave of between seven and 14 days, depending on the number of years of service.