This CEO Chose To Offer His Employees Unlimited Vacation — And Says It's Paying Off10:57
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Kronos CEO Aron Ain. (Courtesy Kronos)MoreCloseclosemore
Kronos CEO Aron Ain. (Courtesy Kronos)

Aron Ain, CEO of workforce management and human resources software company Kronos, put an unlimited paid vacation policy in place in early 2016. He says it was needed to attract the talent the company wanted, and that it has been successful thus far.

In a View From The Top conversation, Here & Now's Jeremy Hobson speaks with Ain (@AronAin) about the policy, and other issues facing companies and their employees.

Interview Highlights

On why he decided to offer unlimited vacation to his employees

"Can you imagine that? Here we are in the business of keeping track of when people go on vacation, and then we introduce a system where people can take as much as they want. But we did it because we are doing very well as a company, and several years ago we had over 300 open positions, and quite frankly we were struggling a little bit filling some of those positions, because the economy's doing well, and knowledge workers are hard to come by, and we try to hire above-average people. And so we needed to change our recruiting profile, and we thought about everything we could do that would make us even a little bit more attractive to candidates. And one of them was the area of time off."

On how the policy has impacted productivity

"I don't notice the change in productivity individually, but I'll tell you we started this policy in January 2016, and in calendar 2016, we had the best year we ever had. Our engagement went to levels it had never reached before. Our voluntary turnover went to the lowest level it's ever been at. So I'm thinking that if I have less turnover, if we have people more engaged, and I look at the overall outcome — the best year we ever had — I don't know, we must be more productive."

"We started this policy in January 2016, and in calendar 2016, we had the best year we ever had. Our engagement went to levels it had never reached before."

Kronos CEO Aron Ain

On possible drawbacks when considering unlimited employee vacation

"We weren't sure what the problems might be. The quick reaction was, people would never be here. People would just take time off all the time, that obvious reaction. But we went to our recruiting people and we said, 'What's getting in your way?' And they said, 'People say they don't wanna come here and start all over with their vacation. They would like to be where they are.' So we said, 'What are ideas about that?' One of them was this open vacation policy that, as I understand it, less than 10 percent of all companies do. And so we started interviewing and visiting with some of those companies and saying, 'Should we be worried about it? Should we be concerned that people will abuse that privilege?' And the feedback we got was actually not, that there were ways to do it that would be effective to help us recruit and retain people and motivate people, quite frankly."

On whether employees have abused the policy

"Not that I'm aware of. In fact, we still keep track of time off, because everybody can't go at the same time. And one of the things we heard is that, a problem that might come up is that people actually with unlimited vacation take less time off, because they don't say, 'Oh the end of the year, I have to use it or lose it.' And so we wanted to make sure that did not happen here. And the way we make sure that doesn't happen here is to keep track of how much time off people have. So that if they're not taking time off, we encourage their managers to sit down with them and say, 'Come on, you need to go refresh, you need to go take some time off.' It's not that we've seen less, because we don't let less happen, and it's not that we've seen it abused, because people still have to get permission to go do it. But, we don't keep track of it in the same way. You can't go over a certain amount."

On qualities that great managers have

"Let me say this, that I believe great people join companies because of the company. They leave companies because of their manager: a manager who doesn't communicate with them, who is not collaborative, or doesn't help them grow and improve. So a great manager, and managers, are people who communicate actively, who care about the people on their team, who care about more than just what they're doing at work, care about them personally, care about their careers, care about their future. I think those are some of the components that make a really effective manager."

On how Kronos' company culture handles sexual harassment

" It doesn't allow it because I don't allow it. I would not tolerate it. I believe companies reflect the leadership at a company. I share people who share my value systems. They then hire people who share their value systems, and the cultures perpetuate themselves right down through the areas. Now, I'm not saying that we haven't had problems like that, but the issue is, I hope our employees feel that ... we wanna know what's going on, and if there's an issue, they need to raise the issue, we take it seriously, we don't sweep anything under the carpet. We have deep respect for everyone who works here, and people should feel safe here and protected here, and feel they can come to work and get their work done in the right environment. So, yeah, I don't think we have a problem with this. Once again, I'm not saying it's never happened, but we deal with it when it happens."

Editor's Note: Kronos has recently been among NPR's financial supporters.

This segment aired on December 19, 2017.

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