Why I Don’t Give Unlimited PTO (And What I Do Instead)
By VICKY BROWN
Unlimited PTO Sounds Great – Until You’re the One in Charge
On the surface, an unlimited PTO policy seems like a no-brainer. It feels generous, flexible, and modern – like something a forward-thinking company would offer. You get to signal trust in your team. You avoid the admin hassle of tracking hours. And you figure, “Hey, this will save me time and headaches.”
But if you’ve ever actually led a small team, you probably already know: it’s not that simple.
In fact, unlimited PTO can quietly create the very problems you’re trying to avoid – confusion, resentment, and even burnout. I know that’s not what you signed up for. So let’s talk about what really happens when time-off policies go vague, and what you can do instead.
The Flexibility Trap: When ‘Unlimited’ Means Unclear
Here’s the irony: the more flexible a PTO policy is, the harder it becomes for people to use it.
Without a clear framework, no one knows what’s “normal.” Is two weeks okay? Four? Can I really take time off right now, or will it look bad? You’ve just introduced a silent guessing game – where every team member makes up their own rules.
Some people don’t take any time at all. They don’t want to seem like they’re slacking. Others go for broke – because hey, it’s “unlimited.” And you, as the business owner, are stuck trying to enforce boundaries that were never written down.
That’s not leadership. That’s chaos.
And worse? Even when no one’s abusing the system, most employees with unlimited PTO actually take less time off than those with a structured plan. Why? Because without specifics, people hesitate. They second-guess themselves. They don’t want to be the outlier.
So instead of creating freedom, you’ve created fog.
You Can’t Scale a System You Can’t Explain
Small teams feel every absence. If you’ve got five or ten people, one person being out impacts the entire workflow. You don’t have the luxury of winging it.
That’s why structure matters so much. Not because you’re trying to control people – but because you’re trying to keep the machine running smoothly. You want everyone to take time off. You also need to know when they’re taking it, how long they’ll be out, and who’s covering what.
Predictability is the key to sustainability. When people know what to expect – when policies are written down, communicated clearly, and applied consistently – things actually get easier.
You stop having to make judgment calls in the moment. You stop trying to remember what you told the last person. And your team stops wondering if the rules are different for everyone else.
The Legal Angle You Can’t Ignore
If you’re in California like I am, unlimited PTO comes with an extra layer of risk.
Here, vacation time is treated as earned wages. So for non-exempt employees, that means you can’t just erase it or avoid paying it out by calling it “unlimited.” You might be opening the door to legal trouble. You’ll want to consult an employment attorney before moving forward with any unlimited PTO structure.
Plus, there’s the issue of documentation. With unlimited PTO, you usually don’t track accrual or approvals. That means if someone leaves your company and claims they were discouraged from taking time off – or that they were denied without reason – you may have nothing to point to but your word.
That’s a terrible place to be if a dispute arises.
“… no, I don’t offer unlimited PTO. And I don’t plan to. I offer a system that works.“
What I Do Instead (And Why It Works)
I use a generous but structured PTO policy. It includes clear buckets for vacation, sick time, and personal days. My team knows how much time they get, how it accrues, and exactly how to request it.
We comply with California’s sick leave laws, which require a specific accrual rate and clear tracking. We also separate that time out from vacation – because the rules aren’t the same.
For flexibility, we offer floating holidays and personal days. So if someone wants to take off for a holiday that’s not on our calendar – or they just need a mental reset – they’ve got options. But we’re not hiding behind the word “unlimited” and hoping it all works out.
And yes, we track everything. Not with expensive software – just reliable tools that help us stay on the same page. It’s transparent, easy to explain, and even easier to manage.
Clarity Is a Culture Move
Let me be clear: structure is not the enemy of trust.
In fact, a well-crafted PTO policy demonstrates trust – because you’re giving people the information they need to take care of themselves without guilt or confusion. You’re not just saying, “Sure, take time whenever!” and then silently judging them for using it. You’re saying, “Here’s exactly how we do this, and here’s what’s available to you.”
And that kind of clarity? It doesn’t just help your team. It helps you.
You can plan better. You can deliver on client work. You can set a cadence that supports long-term growth instead of running from fire to fire. And perhaps most importantly – you can model the behavior you want your team to follow.
Whether you’re an entrepreneur jumping into a leadership role, a seasoned business pro with new HR responsibilities, or just starting your HR career – we’ve got the right path to guide you through your HR hurdles.
Check out the Leaders Journey Experience. This online education platform holds the LJE Masterclass, HR SimpleStart Academy and HR FuturePro Academy.
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Don’t Just Allow Time Off – Take It
If you never take PTO, your team gets the message loud and clear: “We don’t really mean it.”
That’s how burnout culture takes hold – even when your intentions were good.
Taking time off as the leader sends a powerful signal. It tells your team that rest is part of the rhythm, not a reward for burning out. And it reinforces the idea that boundaries aren’t optional – they’re essential.
So don’t just encourage your people to take time off. Show them what it looks like. Plan for it. Step away. And when you return, come back rested and ready to lead again.
Skip the Trend. Build a System.
Unlimited PTO might be trendy, but it’s not always the right fit – especially for small businesses. When you’re still building the culture, still growing the team, and still getting your operations nailed down, clarity is everything.
A structured time-off policy doesn’t make you rigid. It makes you thoughtful. It protects your team, supports your clients, and gives everyone permission to step away – without guilt or confusion.
That’s not just good HR. That’s good leadership.
So no, I don’t offer unlimited PTO. And I don’t plan to.
I offer a system that works.
And in my book, that’s the real win.