It's a cost savings measure for CA companies to avoid having to hold employee's earned vacation hours as a liability to be paid out if they are unused when the employee separates. This is also why they cannot set a minimum, as that would indicate an amount of earned vacation per year.

To be clear, this is still very disingenuous and I believe companies should stop the practice.

It is a loophole in labor laws that CA's legislature especially should close because it is against the spirit/intent of the laws that vacation time should be an asset owed to the employee as part of total compensation, not a whim to be managed (removed without recompense) by the employer.

There are some companies where it seems legitimate, especially larger ones. I hear that at Indeed for example it is very legitimate. The problem in smaller ones is not so much that it is a deliberate lie, but rather a promise the business cannot keep as the bus factor for lots of roles is 1.

It's not legitimate, otherwise you'd take 100% paid time off, get a second job, and collect two paychecks in perpetuity.

It's not unlimited. It's never unlimited. It's always a lie.

I don't fundamentally disagree with you that yes, of course there is always some ultimate limit, nor that it's generally done in bad faith as an accounting scam to get around legal paid time balance sheet requirements. That said, I don't think you're right here:

>otherwise you'd take 100% paid time off, get a second job, and collect two paychecks in perpetuity

Even if 100% genuine, "unlimited PTO" in no way implies PTO for any reason. It's not incompatible to offer it while at the same time having eligibility requirements and other continued employment requirements. At the most simple it merely means there isn't any set limit. A 25 year veteran who gets cancer can be treated differently then someone who just skives off to go party. The latter can just as easily be fired not for exceeding some arbitrary PTO limit, but absence from work without a listed reason in the contract, defrauding the business (if they lie about it), etc.

In practice I don't think "depending on the fuzzy discretion and good will of management/HR/whomever" is a good practical deal for employees in general vs actual hard PTO which translates to money, since at scale the incentives for the business just are not normally aligned that well and even on the employee side those who abuse it will inevitably arise as well further throwing the thing into a negative spiral. It wouldn't stun me though if someone could find a few real examples of companies that had it because they wanted to offer really good sick people more time, there are lots of ideas that depend on human factors which work very badly on average but well in instances.

Sure, if you approach everything in bad faith then yes it's not really "unlimited". That said, calling it unlimited is much easier than saying "we offer no set number of days, use what you need. you still work here though so you can't just not actually ever come to work. act in good faith, use good judgement" every time you open your mouth about a vacation policy.

Be honest. Your manager will decide how many days you get off = unlimited

>It's not legitimate, otherwise you'd take 100% paid time off, get a second job, and collect two paychecks in perpetuity.

This is not a great argument. Unlimited just means there isn't a pre-defined limit, not that every amount has to be approved.

Do you think there's unlimited amounts of money in the world? If yes, then by definition it's worthless (also, can I have a trillion dollars an hour?). If no, then what's the maximum amount of money?

> Unlimited just means there isn't a pre-defined limit, not that every amount has to be approved.

Do you work for my ISP's marketing department?

So you mean 'no defined limit but definitely not unlimited' or do you mean 'unlimited except with the following limitations'? You don't have a great argument.

Then it's not unlimited, it's flexible.

Fair. I agree that it is not truly unlimited.

I have unlimited PTO and have for quite a while and love it.

We are encouraged to take off at least 5 days a quarter / 20 days a year in addition to our holidays (which are flexible given culture, personal preference, etc). We don't count sick days or appointment time towards that. We can take off more, and frequently do, we just have to tell someone we're doing it.

We frequently are put on "nicely forced" vacations if our manager notices we have not taken off in a while. You'll usually get a message from your manager like "hey, schedule some time off in the next month, it's been a bit since you've been off".

This doesn't include parental leave as well, which is pretty solid compared to other places I've been.

The people I know with "Unlimited" PTO all take more than my 5 weeks of limited PTO.

Lie or not, it's still better.

> it's still better.

It _can_ still be better. Or it can be worse, as in the OP's situation.

So... bad companies are going to be bad companies.

Unlimited PTO has nothing to do with it.

I am a small business owner with unlimited PTO. It's not a passive aggressive lie. I want people to take time off. I just can't have large outstanding liabilities associated with accrued PTO.

Do your employees take more time off than they would otherwise get with accrued PTO? If yes, then I doubt it's the outstanding liability issue you are worried about, because you could just set aside revenue for that specific purpose, switch to accrued PTO and come out ahead. If your employees take less time off than they otherwise would with accrued vacation, then it sounds like a shit deal for your employees.

Are you okay with people taking off one week every month? How about two weeks every month? Is it really unlimited?

Why not require your employees to take the time off? You could even schedule it for them at the start of the year "Bob, you're off the first two weeks of May and last two in October" and make it easy for them to reschedule to times that suit them, but not to carry over unlimited amounts of it.

Can't you just force vacation time payout annually to avoid large liabilities? I've worked in places like that and it's usually received pretty well - there isn't any expectation of accruing half a year of vacation over several years of employment anymore - at least not in younger (under forty) folks.

Any company I've worked at with an accrual vacation system has typically had an accrual max, i.e. your vacation doesn't go away but you stop accumulating more when it hits the cap which is usually something like 1.5x annual accrual.

That's a good way to avoid the situation where employees need to take vacations as unpaid time in january but they still end up hitting the same issue in June (or whenever the cap kicks in). So if you accrued up to the max at one of these places would the additional time you would accrue just get immediately paid out? Or was no vacation time earned?

So let's say I earn 4 weeks per year. Don't take any vacation year 1 starting Jan 1. Still not taking vacation year 2. On July 1, I have 6 weeks in total. At this point, assuming a 1.5x accrual cap, I stop accumulating until I take some time off, at which point I start accruing again up to the same 6 week limit. (So no new vacation time is earned until you get below the 6 week cap. There's really no relation to the calendar year.)

I believe some places pay out unused while still employed but I've never seen this.

I worked somewhere where this was the case. A guy went on a two week vacation and called in every two weeks to extend it: for four months. Genius. After that, it was still unlimited, but after three weeks, it was unpaid.

You can cap the accrual. I'm not a lawyer, but I assume it's legal because many big companies have such a policy, in California and elsewhere in US.

Do employees take out more than the regular 5 weeks a year that most people in Europe do?

Yup. It becomes a negotiation, and the company by definition has orders of magnitude more negotiating power (arm-wrestling, etc) than you do.

But hey, "freedom", yay!

This is the unfortunate truth of a lot of US labour laws and why I prefer it up here in Canada. I know with certainty that my coworkers (even university coops!) have access to good healthcare and have provincially mandated vacation time. I work hard in my position and carry a fair amount of responsibility that I've accrued over the years - but I don't want any of my coworkers, no matter how junior and no matter how short their stay at this company may be, to struggle to live a healthy life.