Want More Productive Employees? Netflix Says Give Them More Vacation Time

Beach Relax

[Today’s guest blog post is from Maren Hogan, marketer and community builder in the HR and Recruiting space.]

The same company that led the way in how we watch movies is now paving new roads in vacation policies. In an effort to cultivate self-motivated and self-disciplined workers, Netflix has created an interesting policy on vacation time –none. That’s right, Netflix’s 900 employees have no cap on their vacation days. 

Instead of focusing on how many days, hours and weeks employees spend in the office, Netflix managers put more focus on tracking the work that actually gets done. 

“Prior to 2004 we had the standard vacation model, until we realized no one was tracking how many hours in a day they worked. Why were we tracking whether someone takes two weeks or four weeks of vacation? It was an industrial era habit.” said Reed Hastings, CEO and co-founder of Netflix.

Netflix management has found that the best way to combat this “industrial era habit” was to do away with the more bureaucratic culture of systemizing everything and allow for more freedom and responsibility.

How it Works 

It sounds simple enough, right? Give your employees total freedom and they’ll take total responsibility. Well there’s a little more to it. 

The Employees

They don’t just put effort into creating self-disciplined workers, Netflix sees this as a defining characteristic in a new hire. Recently, Netflix’s 128-page “Reference Guide on Our Freedom and Responsibility Culture” was leaked to the public. Intended as a guide for employees, it has quickly become a go-to reference for employers trying to emulate their culture and practices. 

The bottom line of this reference guide is workplace efficiency. Netflix puts a continual emphasis on effectiveness. The employee who stays till 9pm, but gets just as much work done as the guy who leaves at 4pm and takes 3 weeks of vacation is probably not going to be there for long. They don’t praise time in, they praise work done. 

The Compensation

This is the part that most companies don’t care for. Netflix retains top talent by paying them like top talent. They identify their key players and compensate them accordingly. Additionally, Netflix chooses to offer higher up-front salaries rather than dolling out bonuses or offering stock options. As part of their freedom and responsibility culture, Netflix believes in paying their employees as much cash as possible, and letting them decide what they wish to do with it. 

Lead by Example (this isn’t a trick)

Here in America we have a reputation for being workaholics. One-third of American working adults won’t take their vacation time. Employees often feel that they don’t have the job security to leave. Employers are starting to take vacation time, in part to encourage their employees to do the same. CEO of Netflix, Reed Hastings, says that he sets an example by taking vacations where he can do some creative thinking. 

Smart employers want their employees to reap the benefits of their hard work. When the work is done, take a break! Vacation time leads to more engaged and productive employees. From 1970 to 2006, the average U.S. worker tacked on an extra 200 hours to their work year. Too many workers and employers have lost sight of the benefits of a work-life balance, but not Netflix.

 

Maren Hogan is a seasoned marketer and community builder in the HR and Recruiting industry. She leads Red Branch Media, an agency offering marketing strategy and content development. A consistent advocate of next generation marketing techniques, Hogan has built successful online communities, deployed brand strategies in both the B2B and B2C sectors, and been a prolific contributor of thought leadership in the global recruitment and talent space. Hogan speaks and writes on all career and workforce related subjects. Her clients include Fortune 500 companies and SMBs around the globe. You can connect with Maren on LinkedIn, Facebook and Twitter, as well as read her latest posts on Marenated and RedBranchMedia.com. - Maren Hogan is a seasoned marketer and community builder in the HR and Recruiting industry. She leads Red Branch Media, an agency offering marketing strategy and content development. A consistent advocate of next generation marketing techniques, Hogan has built successful online communities, deployed brand strategies in both the B2B and B2C sectors, and been a prolific contributor of thought leadership in the global recruitment and talent space. Hogan speaks and writes on all career and workforce related subjects. Her clients include Fortune 500 companies and SMBs around the globe. You can connect with Maren on LinkedIn, Facebook and Twitter, as well as read her latest posts on Marenated and RedBranchMedia.com.

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