Is an unlimited holiday allowance the key to happy holidays?

Richard Branson has announced he's giving staff at Virgin's UK and US headquarters an unlimited holiday allowance. No doubt they're happy with the news but does it make good business sense?

Is an unlimited holiday allowance the key to happy holidays?

Image credit: Helga Esteb /

Richard Branson has announced he’s giving staff at Virgin’s UK and US headquarters an unlimited holiday allowance. No doubt they’re happy with the news but does it make good business sense?

If you’re lamenting the end of summer and worried you won’t see the sun again for another year, you’re probably dismayed at the news that head honcho at Virgin, Richard Branson, will allow staff to take as much holiday time as they want with no questions asked. The only catch being that they can only jet off when they are sure they and their team won’t suffer or lag behind as a result. It can’t affect the business – or their careers.

Branson says he got the idea from his daughter, who heard about a similar plan at Netflix. The on-demand media streaming service rolled-out a plan in 2010 whereby salaried employees could basically wander off without their hours being tracked or asking permission as long as they got the job done.”

This idea may sound like a workplace-utopia in the vein of sleeping pods at Google; both are designed to make employees more comfortable and therefore more productive. But, as a policy, unlimited holiday is laced with the risk of potential abuse. It has certainly gotten the staff here at Elite Franchise talking but is Branson’s generosity a dangerous corrosion of the workplace or a crucial and courageous shift in mindset?

“Greater autonomy leads to productivity”,”Kate Leggs, associate, Higgs & Sons

To allow staff to take as much holiday as they like, any time, without approval is a great idea for Branson, who has clearly built a team he trusts implicitly. “But it may not work quite so well where the relationship between employer and employee is less collaborative. The foundation stone of the policy is that Branson trusts his employees to only take time off if it does not harm the business. In other words, staff are responsible for ensuring cover is available and that the work still gets done on time.

This policy is in line with current thinking that giving staff greater autonomy leads to greater productivity. It is a clear incentive to work harder earlier in the week in order to take a long weekend. Overall, this could lead to higher levels of happiness and job satisfaction; some recent studies have shown that happiness is a much more important factor in predicting success than traditional qualities such as qualifications or experience.

There is also a self-regulating mechanism in that staff won’t want to let their team down and leave their colleagues high and dry. There is, however, a risk that employees may never feel able to take time off – that their work is never quite finished or that they don’t want to leave colleagues to cope without them. But I suspect the greatest barrier to the policy becoming widespread is the leap of faith needed by employers to trust employees not to abuse the policy.”

“Small businesses can really struggle for time”,“Sharon Bassett, co-founder and director, A-Star Sports

Richard Branson’s proposal is innovative. But one of the issues for me is the idea of an employee taking time off when they feel 100% comfortable they are up-to-date with work and that the business will not be affected. Each individual’s interpretation of ‘100% comfortable’ varies – colleagues may have a different view on the work done and the position they’re being left in. So much more communication would be required for this non-policy to be effective.

In the context of small businesses, especially those that are customer-focused and built on strong relationships with specific timetables and not just deliverables, it’s not likely to be viable. Small businesses can really struggle for time and resources, so the ‘whenever they want for as long as they want’ would pose a huge problem because there may only rarely be a practical time when a team member’s absence would not damage the business. Some small businesses only just scrape by with a very organised/planned approach to holiday leave.

Having said all that, Branson is talking about a much larger organisation, which has the staff and resources to sustain this flexible approach. But the key will always be that ‘they’re up to date on every project and their absence will not damage the business’, and the rest of the team can cope with any unexpected changes that impact on time and resources during a colleague’s absence. style=

Ryan McChrystal
Ryan McChrystal