3 Alternatives to Unlimited PTO

Over the last several years, more companies have turned to an unlimited PTO model in an attempt to curb burnout and acquire and retain talent. While the offer of unlimited PTO seems attractive, it doesn’t actually encourage employees to take more time off. If anything, they take less time off than their counterparts who have accrued or lumpsum PTO. 

It’s up to HR leaders to build a PTO policy that encourages employees to take time off. Not only does time off positively impact employees, but it can also positively impact the company’s bottom line. Instead of offering an unlimited PTO model, consider these three alternatives. 


Traditionally used in academia, more companies are adopting sabbatical leave for employees who have been at a company for a certain length of time (usually upwards of five years). It’s usually up to the company's discretion to determine how long a sabbatical should be; it can be as short as four weeks and as long as a year. Even on sabbatical, employees are still considered employed with the company and may still be paid. 

Sabbaticals give employees an opportunity to take an extended break from work to rest, learn, travel, or pursue a side project. Offering this type of leave to employees offers several benefits: reduced stress, depression, and anxiety; recovery from burnout; and support in overall mental health. 

From an employer perspective, sabbaticals see improved talent retention, increased creativity and innovation, a more well-rounded and satisfied workforce, and reduced cost of employee turnover. Sabbaticals are a great way for companies to show employees gratitude and appreciation for company loyalty and that they care about their lives outside of work. 

Floating holidays 

Employees in a diverse, multigenerational workforce celebrate various holidays and observances—most outside the company holiday calendar. So, to accommodate a diverse range of PTO needs, companies have added “floating holidays” to their PTO policy that employees can take at their discretion to celebrate religious, cultural, or personal traditions. Additionally, floating holidays allow employees to take extra days off to celebrate special events, volunteer, or take mental health days. 

This can advance an employer's diversity, equity, and inclusion (DEI) efforts and appeal to their employees’ desire for more time off to spend with their family, friends, and community. Floating holidays demonstrate a commitment to your workforce and that you respect their diverse range of PTO needs. As a result, you increase revenue, reduce scheduling problems, improve employee work-life balance, promote an inclusive workplace, and attract and retain top talent.

Mandatory vacation/company shutdowns 

If your workforce has difficulty disconnecting, you might have no other option but to force them. More companies are implementing mandatory vacation to encourage their employees to step away from the computer and take a break. Mandatory vacation can take several forms, from a set number of PTO days employees must take over a given period to a company-wide shutdown. 

There are several reasons why companies choose to do this, such as promoting a positive work-life balance; increasing employee satisfaction; and rewarding employees after a particularly busy time or season. 

Both employees and companies benefit from mandatory vacation. Employees feel a renewed sense of purpose and return to work feeling fresh, feeling less burnt out, and less stressed. This positively benefits employers who see an increase in talent acquisition and employee performance.

Don’t forget about convertible PTO

No matter how your company handles PTO, it’s important that you take it. If you find yourself with leftover unused PTO, consider converting it into causes that benefit you. With PTO Exchange, you can unlock the full value of your PTO by converting it into retirement contributions, student loan payments, charitable donations, and more. Contact us today to learn more.

Published on May 04, 2023 by Rob Whalen

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Discover The Real Story Behind Unlimited PTO 

Unlimited PTO might not be as amazing as many HR executives make it out to be. Find out more with this research report conducted by Lighthouse Research and Advisory.