A startup mandated that workers take off at least 20 days a year. Employee satisfaction soared

It’s officially PTO season. With it has come a reignited conversation about the merits of unlimited paid time off. 

Last week, Kyle Lacy, director of people ops at revenue operations company Go Nimbly, took to LinkedIn to give his take on the policy. Go Nimbly, he wrote in a now-viral post, recently pivoted from a traditional accrual-based time off policy with tenure milestones to a flexible structure reminiscent of unlimited PTO. 

Unlimited PTO is often viewed as anti-employee because workers take less vacation time under this policy than when given a set number of PTO days. In his post, Lacy said he used to feel the same way.

But after conducting regular employee interviews and a formal engagement survey, his team found that most of Go Nimbly’s employees were interested in a more free-flowing vacation policy because tracking accrued days and days used was confusing.

The company now offers a flexible time off policy. Employees must take off at least 20 days each year, and the company offers a workflow monitor to help track the number of days used. Both employees and managers receive virtual nudges if they’ve taken less than a week in a quarter. Lacy says, so far, the system has not been triggered by people taking too little vacation since the policy launched at the beginning of Q2. Previously, employees started at the company with about 16 days of paid vacation time and nine sick days, which Lacy says they rarely depleted. 

Some Go Nimbly employees on its consulting team work billable hours and are accustomed to an incentive program that rewards performance. In developing the minimum vacation time policy, Lacy’s team worked backward to determine the number of hours an employee could work and still achieve a bonus. 

Lacy says his team deliberately tried to distance itself from labeling the policy as “unlimited,” which he views as a misnomer. “I wanted to steer away from that language and be really clear that there’s a flexible policy that has its limits, but also, there is an expectation that you should be taking time off,” he tells Fortune.

Since instituting the new approach to PTO, time off has increased by 28% since Q2 2022, and just under 95% of employees say they agree or strongly agree that they’re happy with the policy.

“Seeing that employees are using it and taking time off [helps me] understand that the benefit is really being able to disengage from work and not feel burnt out,” Lacy says.

Amber Burton
amber.burton@fortune.com
@amberbburton

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