Sabbatical and unlimited leave: How effective are these HR policies?

Company Culture
Joyce Yang
Jul 19, 2022

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Joyce Yang
Joyce has always been in the business of storytelling. By day, she’s a content marketer, copywriter, and journalist rolled in one. By night, she’s training to be a therapist so she might someday help others edit and rewrite their own narratives.

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Everybody needs a break, right? Time off gives employees a mental reset, improving focus, concentration, and productivity. It can also keep employees happy, which can keep them from storming out of your company. 

Giving people a much-needed break—that’s the idea behind some of the new human resources policies that are gaining popularity in response to the Great Resignation of 2021. Namely, company-mandated sabbatical and unlimited leave.

According to Suzie Oh, an experienced human resources director in the service industry, some of the key causes of employee burnout these days include but are not limited to: 

  • Stressful situations
  • Feelings of not being protected and respected 
  • Feelings of not being treated fairly
  • Not enough opportunities for growth
  • No fun at work and no motivation

Hong Kong, India, and South Korea have been labelled as some of the most “vacation-deprived” countries in the world. In theory, sabbatical and unlimited leave may be solutions to employee burnout. But will they work for your company in practice? We take a closer look. 

Unlimited PTO

It’s exactly what it sounds like—unlimited vacation leave for employees. While some companies implement this through leave approval systems, smaller organizations tend to take a laissez-faire approach. 

This policy operates on the trust that employees will not up and go at crunch time, leaving others to clean up after them, and comes with terms and conditions. Employees may be required to find a colleague to cover their duties, cap the number of leave days they take in one sitting or observe blackout periods 

Pros

The main benefit unlimited PTO offers is flexibility. If anything, the Great Resignation has shown this to be the main priority among employees—so much so that they would leave their jobs in its absence. 

Flexibility reduces stress in a number of ways. For one, employees can better integrate life with work. They can take time off for parent-teacher meetings at school or line up to get their booster shots rather than cramming all their obligations into the weekend. When employees have the freedom to decide when to work and take a break, companies reinforce a culture of trust and reap rewards such as morale, retention, and savings—since unlimited PTO doesn’t come with payouts for unused leaves. 

Cons

But there’s a caveat—unlimited PTO won’t work unless the company’s culture genuinely encourages it.

“This policy is effective in theory,” Suzie said. “But it must be introduced when the company’s culture is accepting of unlimited leaves, so employees don’t feel guilty.” 

If managers and C-levels expect employees to reply to messages when on leave, and show little regard for their need for rest, unlimited PTO will be rendered moot. On one extreme, employees might feel too guilty to take the breaks they need. On the other, the policy might be abused by those who are less considerate of the company’s operations and their colleagues’ workload.

Sabbaticals

sabbatical and unlimited leave

Sabbaticals are extended periods of time away from work. They could be paid or unpaid, and range from three weeks to a year off. Airbnb, for example, offers three to four weeks of paid time off depending on how long the employee has been with the company, plus a travel stipend that can be used to book stays or experiences on the Airbnb platform. Meta also offers a 30-day paid break every five years. 

Whereas unlimited PTO offers employees more flexibility and control over their schedules, sabbaticals make it possible for them to pursue further education or long retreats without leaving their jobs. Another distinction is that the latter is usually reserved for highly-skilled employees who have served in the company for a certain period of time. Think of it as a “thank you for your loyalty,” kind of perk. 

Pros

Studies have shown that it takes about four days to decompress from work and ease into a vacation. So if rejuvenating employees is the goal, sabbaticals may be better than unlimited PTO. Besides, if you work in a fast-paced organization, you may not be able to afford longer vacations even with unlimited PTO. 

Sabbaticals, especially paid ones, serve as a checkpoint for employees to look forward to and help with talent retention. Employees are refreshed with a new perspective, and those with a growth mindset could even have new skills and learnings to offer. In fact, studies have shown that these positive changes stick around long after they return to work. 

Cons

While sabbaticals benefit employees most directly, they have logistical implications. Companies need to plan in advance for the absence of key personnel, and employees in functions like sales could leave huge shoes to fill. 

Suzie noted that sabbaticals may not work for industries like the one she is in. “These policies wouldn’t work in the service industry because you would need to control the frequency and timing of leaves as the service industry is very undermanned due to COVID-19.”

Prolonged leaves might also distance employees who, having lost momentum, might struggle to get back into the groove of work. When not planned thoughtfully, the policy could even erode team camaraderie when employees have to work overtime to make up for a team member’s absence. 

Should you adopt sabbatical and unlimited leave?

The short answer is: it depends. 

Both of these HR policies are rooted in good intentions. Sabbatical and unlimited leave both seek to alleviate the burnout that’s been pervading industries throughout the pandemic. In either policy, success really depends on a few factors, including: 

  • Industry
  • Company policy
  • Company culture
  • Organizational structure
  • What employees want

At the end of the day, the best policy is the one that works for your company. Sabbatical and unlimited leave cannot alleviate burnout wholly, Suzie notes, and companies must get to the bottom of it to offer sustainable solutions. 

“Long breaks aren’t the solution to solve burnout. When employees are burnt out, they need coaching. They need employees who are willing to commit themselves to change the way they work and live.” 

About Author

Joyce Yang
Joyce has always been in the business of storytelling. By day, she’s a content marketer, copywriter, and journalist rolled in one. By night, she’s training to be a therapist so she might someday help others edit and rewrite their own narratives.

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