What "Unlimited PTO" Actually Costs Employers (And Why Companies Are Quietly Switching Back)
Unlimited paid time off was supposed to be a win-win: employees get flexibility, companies shed a balance sheet liability, and everyone moves past the archaic "use it or lose it" anxiety that defined mid-century employment. Between 2015 and 2022, adoption of unlimited PTO policies among U.S. companies with more than 100 employees roughly tripled, driven by a wave of tech-sector signaling that spread quickly into financial services, consulting, and healthcare administration. The data that has since emerged is less flattering. Employees under unlimited PTO policies take, on average, two to three fewer days off per year than their counterparts with defined accrual banks. Burnout rates rise measurably in the 18-to-24-month window after a company switches. Discrimination exposure increases. And in California, Colorado, and a growing list of other states, the policy may not even achieve its intended legal effect at termination. This is not a policy failure that gets press. Co...