GE Moves to Unlimited Vacation. Wait…What?!

Unlimited vacation is a concept typically reserved for tech startups, self-employed workers, and Richard Branson. Or is it?

Just last fall, John Grgurich of the Fiscal Times wrote, “The list of companies that offer unlimited vacation is a short one. Some of the better known are Netflix, Evernote, Business Insider, Zynga, Groupon and SurveyMonkey. It’s probably no surprise General Electric, Coca-Cola or Ford aren’t on the list.”

Turns out, his article needs an update. In his defense, few could have fathomed a change like that happening at a company at the top of the Fortune 500 list. But as part of a cultural makeover, GE has decided to join the ranks of companies offering unlimited vacation for 30,000 of its senior-level employees—43% of its U.S. workforce.

CNN Money’s Jeanne Sahadi wrote, “The move is part of a broader cultural shift at GE, which recognizes that it can be more successful when it trusts and empowers its employees, according to Cara Hume, an HR leader in GE’s power and water business.”

Trust is at the crux of any vacation policy that works, even more so for unlimited. The policy can backfire if its poorly communicated. Project: Time Off has talked to countless Americans to get their thoughts on unlimited vacation. Most employees aren’t interested in the policy, as they fear they will end up taking less time than before. They tend to like boundaries and feel more comfortable operating when they know the rules of the road.

But for those companies that get unlimited vacation right, it can be a fantastic option. Just think of all the HR time and energy saved by not having to track the vacation time of 30,000 employees! It all comes down to effective communication and leading by example. It’s great that GE trusts its employees and is giving the policy a try, but it is up to the leadership team there to emphasize the importance of taking time off and model good behavior. That will be the difference between an updated employee handbook and a policy that really works.

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