Does Unlimited Vacation Time Sound Like a Dream? It’s Becoming Reality at Some Ad Agencies

Motivational tool blends life and work

Project: WorldWide staffers received a late holiday gift this year when they returned to work and were given unlimited paid vacation time. The independent employee-owned network of 12 agencies is moving from the more traditional policy of accruing vacation days for personal time off, to flexible time off where there is now no limit.

"In an entrepreneurial company, you want a results-driven culture of trust. You want to find the right people, and it's important to give them the right choices to blend work and life," said CEO Robert Vallee Jr., who explains there's no limit on the paid FTO other than "reasonableness." "Everybody's got a job to do, deadlines and targets are set, and you're still expected to meet them."

Project: WorldWide is taking its cues from one of its agencies, San Francisco-based Argonaut, which has successfully used FTO since opening in 2013. Northern California tech companies and employers like Netflix also have switched to FTO, with CEO Reed Hastings shedding "an industrial-era habit" in favor of a "focus on what people get done, not how many days they worked."

Citing recent survey data, the Society of Human Resource Management said just about 2 percent of U.S. companies have opted for FTO policies. (In the ad industry, there appear to be just a small handful of shops like TBWAChiatDay and Deutsch LA that use it.) Bruce Elliott, manager, compensation and benefits at SHRM, advised that the most important thing to consider is whether a culture is ready for the FTO change: "Do employees know the standards of performance expected of them? It must be clearly defined so they can plan out their work and have more opportunity to use time off when they can."

Elliott added that for employers, an FTO switch bleeds off the cost of accrued benefit time owed to staffers. He added most FTO employees don't take more or less time than they would under traditional policies.

TBWACD president Luis DeAnda said so far FTO has been a "positive experiment" and explained, "It's not necessarily equating to staffers taking more time off, and in fact, we have been encouraging managers to take accountability to reinforce and remind their teams about the intent behind the program. … For many of our international employees, the program helps them feel better about taking extended breaks to make trips back home less time restrictive."

Laura Agostini, chief talent officer at JWT, looked at FTO versus PTO but stuck with traditional time off augmented with extra all-agency days off. "I don't like talking so much about work/life balance as much as how work/life fits our employees' range of lifestyles," she said. "I almost feel FTO is not as equitable. If I'm a team member and I see someone else on the team taking a lot of time off, how do I feel?"

And proving the case that FTO is not an option for everyone is the Tribune Co., which quickly rescinded a new unlimited vacation plan in 2014 at the Los Angeles Times when employees threatened to sue over the lost monetary value of accrued vacation time long-term staffers had amassed.

How it's working at one agency

Argonaut believes in giving employees the space to find things that inspire. Imagine a job where you're paid to go off and write a screenplay, take a family vacation in Malaysia, study improv, learn film editing or just walk the Santa Cruz boardwalk with your fiancé. 

That's a snapshot of some of the recent out-of-office time enjoyed by the 85 staffers at the agency, which also gives employees $500 a year to "enrich their creativity." "We're an industry hinged on creativity," said Maura Menapace, head of culture and talent. "You have to find the things that inspire you." Menapace added that the only catch is making sure the time off is appropriate with work schedules and deadlines: "We trust you. We know you're going to come in, get the work done and be responsible."

While FTO didn't start as a recruiting tool, it's become one. Matt Ashworth, who's worked at some of the West Coast's best agencies, quit full-time agency work in 2013 before becoming an ecd at Argonaut in 2015. "FTO definitely influenced my decision to take a job because taking time away when you need it has always been how I work. … You hire good people, you give them the freedom to do their jobs and great things happen," he said.

This story first appeared in the Jan. 25 issue of Adweek magazine. Click here to subscribe.