Microsoft is ditching its paid vacation policy in favor of an unlimited vacation policy where staff don’t need to accrue vacation or log paid vacation days.
Microsoft human resources director Kathleen Hogan announced the change in an email to US employees, explaining how the company is bringing a “more flexible model” to its vacation policy.
Unlimited paid leave policies have become a popular tool for attracting and retaining talent in tech, finance, and other industries facing staffing shortages. According to The Verge, which viewed the memo, Microsoft calls its policy “Discretionary Time Off.”
A right reserved for American employees
The new policy comes into effect on January 16 and also applies to new employees, who no longer need to accumulate vacation time. Microsoft is maintaining its ten corporate holidays, along with other categories of leave. Employees will receive a one-time payment in April for any unused vacation balance.
The new policy only affects US employees and does not apply to hourly workers.
Kathleen Hogan says the new leave policy is the next step in the move towards more flexible working arrangements she introduced in response to the pandemic.
“How, when and where we do our work has changed dramatically,” says Kathleen Hogan in the internal memo. “And as we have transformed, modernizing our vacation policy to a more flexible model was a natural next step. »
Model modeled on LinkedIn
As Cate Chapman of LinkedIn News notes, Microsoft is adopting LinkedIn’s unlimited paid time off policy. LinkedIn moved to unlimited paid time off in 2015 following Netflix, which introduced unlimited paid time off in 2003 in part to obviate the need for an employee paid time off logging system. More recently, Goldman Sachs introduced it for partners and managing directors.
Until now, Microsoft employees also had four weeks of parental leave and an additional week every six years, notes Cate Chapman. Microsoft can save on administrative costs by adopting more flexible working hours.
According to a BBC article, some surveys have also found that employees take fewer vacations with unlimited time off. Some companies have even backtracked, rescinding this policy, after noticing employees felt guilty about taking vacations.
Source: ZDNet.com