Misunderstood Benefits | Unlimited PTO and Beyond

Misunderstood Benefits | Unlimited PTO and Beyond

The benefits culture is strong for today’s workforce with staff actively deciding to work with companies that offer the best perks. For businesses, it’s a chaotic and often confusing space where it’s important to identify what’s important to your brand, business and staff. 

Whether that’s free snacks, unlimited PTO or parental leave options, let’s explain the basics of today’s benefits. 

SECTION ONE: Discussing the employee benefits 

Discussing the employee benefits

As companies embrace hybrid work initiatives, employee benefits are changing. In this section, we’ll highlight some well-known and less well-known benefits. This includes everything from unlimited PTO for hourly employees to paternity leave and flexible working hours. 

Common and costly benefits 

#1 Parental leave 

Parental leave is a key benefit for many workers. An article from the World Bank recently highlighted how “ensuring that mothers and fathers have adequate paid leave for the birth of a child should be a priority for economic development.” 

Recently, there has been a focus on reducing the gender gap and extending paternity leave. A recent McKinsey report states: “The cultural context around paternity leave is changing, as more countries and companies are offering the benefit to new fathers.” 

Small companies can still offer great paid-leave programs, according to a recent HBR article, highlighting how such policies can help you attract and retain top talent. 

#2 Health insurance 

This one’s a must for any business and its staff. In the US, you usually choose between a traditional health insurance package or “managed care”. 

What’s the difference? 

Traditional health insurance tends to have high premiums and a wider selection of healthcare providers. 

Managed care has lower premiums but offers a smaller selection of healthcare providers. 

How can you find and compare providers? 

Well, the online health insurance marketplace is booming, with plenty of sites now available to help businesses get an accurate estimate of their employees’ options. 

When you start your search, make sure you have some key information to hand. This includes zip code, number of employees, employee names and their dates of birth. 

You’ll probably need to understand some of the jargon too: 

  • Premium: the amount of money you pay per month for health insurance coverage. 
  • Deductible: the amount of money you pay before your insurance starts paying for health service. 
  • Copay: the flat fee you pay for medical services. 
  • Coinsurance: the percentage of the bill you pay for medical services. 

#3 Tuition assistance 

Tuition assistance is a way to reimburse your workers for any courses they take. In a recent survey, 84% of workers said that skills earned through this type of program allowed them to properly prepare for the future of work. 

Here’s how it typically works. 

An employee pays upfront for a course. That could be a college diploma, continuing education or an online course, for example. 

When the course finishes, the employer refunds a portion of the money spent – or the full amount. 

Or you could offer an annual lump sum to help staff pay for tuition, textbooks and other education-related expenses. Or offer to pay a set percentage. 

Whichever route you take, paying for tuition is a clever move for businesses. It keeps your staff’s skills sharp. Plus, it’s a tax-deductible benefit for your business. 

#4 Student debt assistance 

US student loan debts reached a record high of more than $1.5 trillion in 2020. That’s an increase of roughly $166 billion since 2019. 

That puts graduates under tremendous pressure. “For managers and human resources professionals, overwhelming student loan debt could also lead to younger staffers being distracted and unfocused at work and steer them toward moonlighting jobs that further sap their physical and emotional energy,” one report reveals

That’s where businesses can help

An employer in the US can also now make up to $5,250 in student loan payments for an employee within a year – and that’s tax-free. It’s certainly an option to consider if you want to attract new graduates and fresh talent into your organisation. 

#5 Life insurance 

Life insurance pays out a lump sum to any one of your employees who die while under your employment. The death does not have to be related to their work or happen in the workplace.  

As with other insurance policies, you’ll pay premiums to cover your staff. The lump sum may be related to your employee’s salary. A value of between two to four times the annual salary is usually offered. You could also tie this in with your medical insurance benefits

#6 Retirement plans 

Generally, you match your employee’s contributions to a retirement plan, which they access when (you guessed it) they retire. Again, there are tax perks here for employers.  

There are plenty of options to choose from. In the US, you’ll need to decide between a qualified or non-qualified plan, depending on whether it’s subject to certain federal pension law provisions.  

Misunderstood or uncommon benefits 

#1 Unlimited PTO 

Unlimited Paid Time Off (PTO) sounds great, right? Here, an organisation provides staff with unlimited PTO to take fully paid leave, for whatever reason your employee requires it for, without providing a specific number of days for them to take their annual allowance from. 

Of course, there’s a but. 

But your staff still have to complete their work. In other words, an unlimited PTO policy leaves workers at the mercy of their workloads and company culture. Often, it’s tied to the output of your staff. 

This is where the wrong unlimited PTO is bad for certain companies and scenarios. Some people may avoid taking time off for fear of looking lazy. Others may judge colleagues based on their number of days off. Or your staff may be so overloaded with work that they can’t take a vacation. 

Past experience has shown that unlimited PTO is bad for some companies too. Tech company Buffer, for example, pulled the plug on its unlimited PTO policy in 2016, reportedly because it was costing the company too much money. 

What about unlimited PTO for hourly employees? 

Well, unlimited PTO for hourly employees is another tricky scenario. While it’s not impossible, unlimited PTO is tied to output. So, unlimited PTO for hourly employees is probably a no-go.  

However, it’s about having the right unlimited PTO policy in place. If it’s used properly, unlimited PTO shouldn’t have any negative consequences for your company – or staff. 

#2 Flexible working arrangements 

Flexible working takes many forms. It basically describes any working arrangement where your staff get a certain degree of flexibility on how long, where, when and at what times employees work. 

This includes part-time working options, term-time working (where paid or unpaid leave is taken during school holidays), job shares, flexitime, compressed hours, and annual hours (where you work a set number of hours in the year). Career breaks and zero-hours contracts are also other forms of flexible working. 

However, most people hear ‘flexible working’ and think ‘remote working’ – where you can work in a location remote from your regular office. That could be your home, office, home and other workspaces – like coworking spaces.  

Now, many businesses are opting for hybrid work arrangements

What does this mean? 

Well, hybrid work initiatives let workers divide their time between different workspaces. 

When finding the right hybrid work policy, it’s important to understand which combination of office versus remote working is right for your organisation. You want to maximise productivity and employee wellbeing. 

Many businesses are assessing which roles and responsibilities are best suited to which environment. Office work is best for collaboration and home working is often better when you need to concentrate, free from distractions. 

Either way, a hybrid work initiative is a savvy move for most businesses, helping you reduce office space costs and boost productivity. 

#3 Financial planning assistance 

Employer-paid financial planning is a growing employee benefit, helping staff stay on top of their finances. This is an important perk. Research shows that 81% of staff experience some level of financial stress; fully half lack any sort of emergency cash fund; and 73% lack a game plan for retirement. 

What are your options? 

Well, you could give staff access to a financial planner and counselling service. Speaking to a professional can help workers make smart financial decisions. 

There are also some online platforms to help staff financially plan for the future. These typically include budgeting apps, comparison tools and provide a wealth of information on keeping in the black. 

#4 Volunteer opportunities 

Employee volunteering helps your business give back to the community. It’s a great way to help staff engage with the initiatives they’re passionate about too. 

During such initiatives, staff donate their time and skills during working hours to tackle social issues. It’s a powerful and effective way for your business to invest in its workforce and communities, while helping to create a fairer society and more sustainable future.  

Your staff get to share their skills and insights with different communities. Or you could provide contributions in kind to certain projects, match giving for your staff’s sponsored fundraising activities, fundraise for a ‘Charity of the Year’ or participate in local one-off volunteering events. 

#5 Developmental opportunities 

Development opportunities is an umbrella term for a host of potential benefits to help your staff build up their skills.  

Mentoring, for example, is a powerful tool for professional development, bringing benefits to mentors and mentees. Work-based and off-the-job training is also great to help staff explore new roles and ways of working. 

You could also offer work shadowing opportunities, run a series of workshops or internal seminars. 

SECTION TWO: What benefits should employers offer more widely? 

What benefits should employers offer more widely?

The choice of benefits comes down to your brand. It’s important to find those options that your staff value – and those that will boost your business. 

So, what benefits should employers provide to their employees? Unlimited PTO? Free snacks? A kick-ass ping pong table? Let’s find out. 

Employees value many, cheap benefits 

When it comes to your benefits package, don’t put all your eggs in one basket. Instead, try to offer a diverse range. Here are some popular options to consider. 

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#1 Unlimited PTO allows goal-oriented approach 

One of the major advantages of unlimited PTO is that it allows your business to take a goal-oriented approach to its work. 

What do we mean? 

An unlimited PTO policy works best when the company culture already operates on a goal-oriented basis that tracks performance and goals. In other words, if you already have policies in place to measure staff productivity and success, then an unlimited PTO is a (relatively) quick and easy win.  

Unlimited PTO is also good for morale, allowing your staff to rest up and rejuvenate, avoiding burnout.  

Productivity also increases with unlimited PTO. “Employers have discovered that giving employees sufficient time off to relax and rejuvenate promotes more productivity. Employee burnout is a real problem and can lead to stressful situations and confrontations. Encouraging employees to take time off helps them improve their overall performance once they return from vacation,” one report reveals

An unlimited PTO policy is still a relatively rare perk, helping your business stand out from the competition and attract (and retain) top talent. What’s more, unlimited PTO helps you promote a culture of trust at your organisation. 

Staff are also more likely to stay at home when they’re sick (or their kids are sick) too, helping to promote wellness and keep your workplace healthy. That’s because they don’t have to worry about losing PTO days. 

Unlimited PTO also eliminates the administrative burden for your HR department. 

#2 Financial planning is extremely useful and can utilize existing assets 

If you run a successful business, chances are you will have had some form of financial advice over the years. If you extend this benefit to your employees, then you don’t have to reinvent the wheel. 

Instead, you can use some of your existing assets to introduce staff to financial education resources. Online learning environments, for example, can be used to deliver classes on financial wellbeing. If you already work with a financial advisor, they can run these classes. 

It’s important to create an education programme tailored to your company, based on the benefits you already offer. So, make sure you explain the perks of your company’s retirement plans, stock options or whatever other benefits you offer staff to make sure they take full advantage of what’s on offer. 

#3 Employee discounts make employees feel cared for and loyal 

An employee discount scheme is a great way to show your staff that you appreciate them. These schemes usually provide discounts and vouchers for their favourite outlets. You may want to do a little in-house research to find out what your staff do and do not value. 

There are plenty of options to choose from. Offering a wide variety of wellbeing discounts to your team shows that you care about them beyond just their day-to-day role. It also demonstrates to staff that you actively promote a good work-life balance. 

#4 Flexible working arrangements build trust and reduce stress 

Unlimited PTO is certainly a major trust exercise between employer and employee. So are flexible working arrangements. 

If you put a flexible work arrangement in place, you’re clearly showing your staff that you trust them to do their work, without a manager standing over their shoulder. 

Flexibility empowers staff to make choices about when, where and how to work that best suits their needs. Some companies put ‘essential hours’ into their flexible work arrangements where, for example, every member of staff is expected to work between 10am and 2pm.  

Whatever your flexible work arrangements look like, it’s important to establish trust in your (office and remote) workplaces. Make sure you establish common values with your team and communicate in a way that works for them. Some people love Zoom, others communicate best over email, for example. This is an important point. You need to both build trust and have the right technologies in place to enable this. 

Research reveals, if you can get your flexible work options right, this massively reduces stress across your teams. A recent port states: “reduced hours flexible working (which includes choosing to work part-time) may indeed be good for employees’ levels of chronic stress.” 

#5 Volunteering boosts well-being and costs nothing 

Volunteering can help staff make friends, learn new skills, advance your career, and even feel happier and healthier, according to a recent report

Employee volunteering also brings plenty of benefits to your business too. It increases your brand awareness and empowers your employees, helping you create stronger and more connected teams. 

Volunteering also helps your staff build new skills. Companies who offer this perk also report a reduction in sick leave. What’s more, such schemes can also help your managers see which team members might make future business leaders. 

#6 Developmental opportunities are an investment in the business itself 

Investing in your staff is a bit of a no brainer for businesses. By helping staff grow on a professional level, you’ll get a range of business benefits back: 

  • Attract and retain talent: if you invest in your staff, this builds loyalty and boosts your reputation. It can help you bring in good people, some of which you may meet during training, continuing education and the conferences your staff attend. 
  • Create promotable employees: instead of externally recruiting new managers and business leaders, you can tap into your homegrown talent. Your existing staff are not only familiar with your business and clients, but you can also reduce your recruitment and onboarding costs. 
  • Increase engagement: bored staff are a recipe for disaster. By helping your staff explore new and interesting learning opportunities, they can build new skills and break the 9-to-5. 
  • Save money: a good employee is money in the bank. They can become brand advocates, helping you attract more talent into your business. Plus, they’ll be better at their job and have the knowledge and experience to help others in their work. 
  • Plan for the future: if your staff continue to grow and educate themselves, so will your business. In other words, because your employees are actively engaged in your industry and improving themselves, your company will also keep its finger on the pulse. 

Considerations for a post-COVID world 

Considerations for a post-COVID world

The recent pandemic has changed the way we work. Probably forever. For businesses, you need to make sure you recognise these changes – and act on them. 

#1 Office sanitisation is cheap but very important 

As we start to return to our offices, it’s important to build staff confidence in the cleanliness of your workplace. Office sanitisation is a cheap but effective way to help you achieve this. 

There are several measures you can put in place to promote office cleanliness. Hand sanitisers are an obvious quick-win. You may also want to invest in additional cleaning staff. Air quality is another consideration for many businesses. There are also plenty of touchless technologies you can use to reduce transmission rates in your office. 

If you are moving to a hybrid way of working, then you’ll need to change your approach to hot-desking and put more rigorous cleaning processes in place. You could even employ a robot cleaner

#2 Flexibility and remote work are the norm 

The recent pandemic has accelerated digital adoption rates, with many companies embracing work-from-home initiatives when they were forced to close their offices. 

Now, workers don’t want to go back to the office. And who can blame them? 

If 2020 proved anything, it’s that the majority of businesses can work remotely. As such, flexible working is no longer a benefit but often an expectation of today’s modern workforce.  

Incorporating multiple flexible working arrangements into your existing organisational structures is a challenge. Your business must ensure its flexible working initiatives address inclusiveness, customer responsiveness, fairness and do not dilute your corporate culture. 

SECTION THREE: Things to consider when putting together a benefits package 

Things to consider when putting together a benefits package

To build an effective benefits package for your business, there are many factors to take into account. In this section, we highlight the top three considerations. 

#1 Budget 

Benefits will cost your business money. But some benefits cost more than others. So, it’s important to conduct a thorough cost analysis of your proposed benefits in terms of cost and also the (tangible and intangible) rewards your business could realise. 

Employee benefits in the US make up 30% of total compensation costs, according to a 2019 report by the Bureau of Labor Statistics.  

Cost-effective benefits include: 

  • Free food/snacks 
  • Remote/hybrid working options 
  • Company-sponsored discounts 
  • Volunteering and training opportunities 
  • Free parking spaces 
  • Wellness resources 
  • Unlimited PTO 

#2 Employee preferences 

We’ve already touched on this, but you don’t want to offer a benefits package that no one wants. 

So, make sure you engage with your staff on what they actually want. You may want to conduct a survey, asking employees to rank their top three benefits preferences, for example. 

When you have a better understanding of what policies are important to your staff, drill down again, to find out more information about what they want. For example, do your staff prefer to work from home or in an office? How far do they want an unlimited PTO policy to go? 

Also, try to align your benefits strategy with your business objectives. For example, can any volunteer opportunities be tailored to your corporate values? Do you already offer any products or services useful to your staff? 

By working with your staff, you can create a benefits package that’s tailored to their needs and your wider business objectives. Once it’s complete, educate your employees about your benefits programme. Explain how it fits in with your goals and how your rewards policy can boost your appreciation and understanding of your staff. 

#3 Nature of your work 

Every business is different. Some professions, for example, are better suited to unlimited PTO. Others are completely unsuitable for remote work. It’s important to assess each potential benefit with regards to how feasible it is for your business. 

For example, unlimited PTO for hourly employees may not be feasible or financial workers may not value financial planning to the same degree as other employees. In short, your benefits package should be flexible to meet the needs of your business and the individual worker. 

In conclusion 

The right employee benefits can have a significant impact on your business. They can help you retain and attract top talent, boost your productivity and staff morale and keep your business ahead of the competition. 

Here are a few additional factors to consider: 

  • Bring in a benefits specialist – to help you find the right package for your staff. 
  • Find the right technology – to help you implement and run some of your benefits (such as online education, for example). 
  • Measure benefits and costs diligently – to ensure your benefits strategy works for your business. 
  • Monitor employee needs – and change your benefits package as preferences, invariably, change. 

If you’re thinking about introducing a new benefits package and want to find out more about the future of work, click here


  1. Is unlimited PTO bad? 
    • No, but it’s not right for every business. If your business is goal-oriented, then unlimited PTO is usually a good fit. However, unlimited PTO for hourly employees is often infeasible. 
  1. What are the most important benefits to employees? 
    • It depends on your staff and business. Remote/flexible work is increasingly an expected benefit. 
  1. What is an example of an employee benefit? 
    • Anything where your business provides a non-salary compensated item to its employees as part of their remuneration. An example is parental leave, where paid maternity, paternity and adoption leave is paid to the employee. 
  1. Is unlimited PTO really unlimited? 
    • It depends on your policy. But unlimited PTO is an option, allowing your staff to take as much paid leave as they want. 
  1. How does unlimited PTO work for hourly employees? 
    • No, because they earn vacation as compensation based on the hours worked. 
  1. How do companies manage unlimited PTO? 
    • Different companies have different policies. Typically, employee leave is scheduled as usual – but there’s no limit to the number of days you can take off. Sometimes, managers decide how much leave is reasonable and sustainable for their teams. Without a set limit, employees must predict how much time off they should request. 
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