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This is how the unlimited vacation model on Netflix arose, according to its CEO

Date: March 26, 2023 Time: 15:46:53

Unlimited vacations? Just the mention of these two words seems like a dream. But, is it possible to implement a system of these characteristics in a company? Apparently on Netflix, yes. Or, at least, that’s what it seems according to their company policy.

It is also true that it must be qualified that this unlimited vacation policy is also known in the company environment as non-vacation. What, then, does this policy refer to? According to the CEO and co-founder of Netflix, Reed Hastings, this entire system is based on the freedom of organization and flexibility that workers enjoy. Let’s go into more detail to understand how it works.

Basically, this policy means that employees can decide for themselves when to work and when to take breaks. This theory, which seems flawless at first glance, is a double-edged sword. On the one hand, the freedom and flexibility of this vacation method would greatly facilitate conciliation and help avoid burnout and work stress. On the other hand, the reality could be very different, since in the end the employees would end up working much more for fear of losing their job.

Netflix CEO Reed Hastings explains that until 2003 Netflix operated like any other company, managing vacation days and work schedules for its employees. However, Hastings realized that many of the company’s biggest innovations and improvements happened after people returned from vacation.

“Free time provides a relaxation that allows you to think creatively and see your work in a different light,” Hastings points out. “If you’re working all the time, you don’t have the perspective to see a problem with another approach.” This is how he explains the starting point of this no-vacation policy.

Potential negative consequences of this policy

This method is based on very simple reasoning. If the hours they worked are not tracked, for example, on the weekend or outside of our working hours, why can the free or vacation periods be tracked? “I’ve never paid attention to the number of hours people work. Why should I care if an employee works 50 weeks a year or 48 weeks a year?” Hastings wonders.

The initial approach was positive, but the implementation of this policy could bring with it two disastrous consequences that, indeed, happened at the beginning. The first is that the workers took vacations on designated dates, such as the closing of quarterly accounts. The second, that the employees did not take vacations out of fear and ended up even more burned.

The key to overcoming these two difficulties was maintaining direct communication with workers, explaining how and when to apply this policy, and trusting that by giving them freedom and trusting them, they would behave responsibly.

Benefits of an unlimited vacation policy

When done right, an unlimited vacation policy can be empowering and increase employee satisfaction, as well as being a good recruiting and talent attraction tool. It also reduces bureaucracy and administrative costs.

The best thing about removing restrictions on vacation time, however, is the “emotionally intelligent” message it sends to workers. “It conveys to them that we trust them to do the right thing, which in turn alienates them to behave responsibly,” Hastings says. Thanks to this policy, at Netflix it was possible for employees to have more control over their lives, more work-life balance and a much greater feeling of freedom.

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.

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