Microsoft, the world’s largest software firm, is abandoning its four-week vacation policy in favor of unlimited paid time off for US employees. The IT giant’s paid time off strategy will be replaced by a “discretionary time off” method that allows employees to take time off as needed. A professional staff member is given paid time off for a significant achievement or effort that contributes to the organization’s mission, goals, or objectives.
“How, when, and where we do our jobs has dramatically changed,” explains Hogan, Microsoft’s chief people officer, in the internal memo. “And as we’ve transformed, modernizing our vacation policy to a more flexible model was a natural next step.”
According to The Verge, Microsoft’s chief people officer Kathleen Hogan announced the policy change in an email to employees on Wednesday. The company has about 122,000 employees in the U.S., according to its corporate website.
According to the news outlet, the changes will take effect on January 16th, and even new Microsoft employees will no longer have to wait to earn vacation time. Microsoft will offer 10 corporate holidays, leaves of absence, sick and mental health time off, and time away from jury duty or bereavement alongside this new unlimited time off policy. Employees that have an unused vacation balance will get a one-time payout in April.
However, neither hourly workers nor employees outside the United States will be granted limitless time off. According to Microsoft, federal and state wage and hour laws make it difficult to grant limitless time off to hourly workers, while those outside the United States will retain their current vacation benefits due to varying laws and regulations in other countries.
Microsoft is hardly the first tech titan to provide unlimited vacation days. Salesforce, Oracle, Netflix, and LinkedIn, which are owned by Microsoft, all offer their employees unlimited vacation time. The new policy follows Microsoft’s decision to allow more workers to work from home permanently, as well as the company’s $1,500 pandemic bonus for staff.