Virgin’s Unlimited Annual Leave

25 September 2014

The Guardian has reported that Richard Branson intends to implement an annual leave buffet of sorts for staff managing his personal fortune.  The ‘policy’, or rather lack of, will mean that 170 of his UK and US personal staff can take holidays when they like and for as long as they like.

Branson said he had introduced the new “non-policy” on holidays for 170 staff in his private offices in the UK and US with immediate effect. Employees can take leave from their jobs when they like without seeking permission, as long as the timing of their break will not have a detrimental impact on the business:

“It is left to the employee alone to decide if and when he or she feels like taking a few hours a day, a week or a month off, the assumption being that they are only going to do it when they feel 100% comfortable that they and their team are up to date on every project and that their absence will not in any way damage the business – or, for that matter, their careers!”

Branson said he got the idea when his daughter Holly forwarded him an article about online streaming company Netflix, which has taken a similar approach.

The premise was founded on the concept that with the introduction of technology, employees were no longer expected to simply follow a 9-5 work routine and were normally responding to emails and continuing their duties on weekends and evenings.  Netflix employees queried the disharmony between the old-fashioned holiday structure and the realities of modern working hours and the company agreed.  A large number of Netflix employees are now permitted to take holiday whenever they wish, for any duration they wish, provided their managers know where they are and that their work is covered.

As above, Richard Branson is now adopting the policy and recommending other companies do the same.  As utopian as the concept appears, it potentially sets a minefield of employment law issues.  Richard Branson has stated that any holidays his employees take will be placed under the assumption that they are “a hundred per cent comfortable that they and their team are up to date on every project and that their absence will not in any way damage the business – or…their careers”. Seemingly then, the luxury of deciding their own holiday entitlement comes with stricter expectations than standard annual leave.  Indeed, it is important that the requirement of not causing “damage to the business” does not dissuade employees from taking their entitlement under the Working Time Regulations.  This is just one of a plethora of potential employment law implications of the scheme.

Whilst it is unlikely that the policy will be appropriate for most business models, it may well succeed where it is not necessary for employees to be physically present in the office to undertake the majority of their role duties.  This may explain Netflix’s success in implementing the policy thus far.