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'If you need time away, take it': Some companies offer unlimited vacation and sick time

Jamie Thompson works as a graphic designer Tuesday, Feb. 9, 2016, at H2M in Fargo. The company adopted a flex time policy nine years ago.Michael Vosburg / Forum Photo Editor1 / 2
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FARGO — Does the offer of unlimited vacation and sick time seem too good to be true? Not for employees of companies that provide flex time off like Netflix and Virgin.

Rather than earning a fixed number of days off per year, their employees are free to take as much time off as they want or need provided that their work is done. Employees are valued based on what they accomplish, not on how many hours they spend in the office.

It's a concept that's gaining traction with many startups and tech companies whose employees often work outside of the standard 9-to-5 workday.

H2M, an advertising and marketing firm based in downtown Fargo, made the switch to flex time off in 2009.

Partner and Chief Financial Officer Nancy Mansouri proposed the plan because she did not want to process the paperwork involved with tracking hours and processing requests. Furthermore, she said many people were holding onto their vacation time until the end of the year when they would be forced to "use it or lose it." That became a problem because everyone wanted to be out of the office at once.

The firm's 16 employees are instead urged to take time off as needed, whether it's for a dentist appointment, school program or a 10-day cruise.

"We treat everyone like a professional here. If you need time away, take it," she said. "Our employees understand we value them. We place an importance on time away to refresh and that it's necessary to being productive in your personal and professional life."

For the most part, she said employees embraced the change.

"I won't say there's never been a bump in the road. You're going to have the person or people who will abuse it. What's interesting to me is that it's evolved so staff self-police each other. If they feel someone else is taking excessive time off, they'll step in."

Stephanie Winterquist, past state council director for the North Dakota Society for Human Resource Management, said she is not aware of any other Fargo-Moorhead companies using flex time off. But, because they are not required to provide personal time off, management is free to implement whatever plan works best for the company.

"There's no federal mandate. No state mandate. Nothing that says companies have to offer paid time off," Winterquist said. "If a company is able to have a system like this and just manage it from the perspective of if they're getting their work done or not, that's awesome. I'd love to be in an environment like that."

Her concerns were mainly about recording hours worked in order to comply with the Affordable Care Act.

"There are still regulatory things companies have to report on that could be an issue if they're not keeping track of hours worked," Winterquist said.

Mansouri said the biggest hesitation she's heard from other employers considering flex time off is that no one will be in the office.

"The interesting thing we've found is that it doesn't happen. People sometimes take less (time off) than they would have taken," Mansouri said.

That was a concern for Winterquist as well. She said many employees are hitting their employer's maximum PTO accrual cap the way it is, which points to a big benefit to employers who use flex time. They do not have to pay out accrued vacation time when an employee leaves the company.

Winterquist and Mansouri agree that flex time off will not work for every company.

First and foremost, the company needs to make sure flex time off will not endanger their customer service. Second, they need to ensure employees must know exactly what is expected of them.

For those who are still skeptical, Netflix provides a simple analogy in its employee handbook:

"Netflix Vacation Policy and Tracking: There is no policy or tracking. There is also no clothing policy at Netflix, but no one comes to work naked. Lesson: You don't need policies for everything."

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