Richard Branson was inspired to implement this "non policy" as a result of his daughter's suggestion that he should follow the lead of Netflix. Netflix implemented a policy of allowing its silicon valley employees to take as much leave as they wanted, when they wanted, a number of years ago. The change was apparently motivated by the fact that no one was tracking how many hours each employee worked in a day and the focus was instead upon their overall productivity. In the case of Netflix it was clear to see that sometimes employees worked more than their contracted hours by staying late or working through lunches, checking emails and making telephone calls from home in the evening, but on the other hand sometimes they left a bit early to look after their children or for other personal reasons. Netflix wanted to adapt and take a modern approach to working time and annual leave so it implemented a policy of effectively having no policy on those issues, provided that the work was done on time and to the right standard.
Richard Branson has followed suit and is taking the same approach in relation to holiday entitlement for his 170 personal staff. They are trusted to take time off whenever they feel like it, for however long they want. The holiday does not need to be approved by anyone and the employees do not need to say when they intend to return to work. The only condition is that the leave is not detrimental to the running of the business. Richard Branson's approach is summed up in Netflix's statement that "we focus on what people get done, not on how many hours or days worked".
This certainly reflects the move in modern workplaces towards flexible working, and there are few employees who would say no to more holidays, but does it work?
Anecdotal evidence from companies that have taken this approach suggests that it gives the staff a little more freedom and responsibility in carrying out their work, and it seems to build a mutual trust and confidence between the employer and employee. It also appears to boost staff morale, which, in theory can also affect staff output.
However, there are pitfalls to unlimited holidays. While it has found popularity with start up companies in Silicon Valley, unlimited leave may be tricky to coordinate fairly in larger companies and in industries such as manufacturing or sales, or those jobs which are paid on an hourly rate. It has also been argued that unlimited leave may result in employees taking less time off, as employees may initially struggle to decide how much time off is appropriate in the absence of any limits. Employers in the UK would need to be careful not to breach the provisions of the Working Time Regulations when looking at how much annual leave an employee takes.
Is this initiative likely to take off in the UK? Probably not. In the US, where the culture is more focussed on profitability, it is generally speaking easier (and quicker) to dismiss an employee who isn't performing to the standards envisaged by the employer. In addition in the US, paid leave isn't regulated by law in the same way as it is here, where the level of employee protection is much higher. As the Working Time Regulations 1998 provide that employees in the UK are entitled to a minimum of 5.6 weeks paid leave, employers may not see the benefit in offering unlimited days off. This is particularly so given that it could be open to abuse by employees resulting in employers then facing a lengthy performance management process before they could fairly dismiss employees who underperform as a result.
Having said that, whilst unlimited leave may not be an attractive prospect for many employers in the UK, smaller start up businesses in competitive "results-driven" industries may see the benefit in offering unlimited holidays as a means of attracting and encouraging new talent into their business.
Although Richard Branson has said if the unlimited annual leave policy continues to work with the current 170 employees then he will roll the policy out to all 50,000 of his staff between the UK and the US it will be interesting to see whether this works across the board taking into account all of the varied work types this would encompass.