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A podcast about a better way to work and run your business. We bring you stories and unconventional wisdom from Basecamp’s co-founders and other business owners.

EPISODE 0103

Take Some Time Off (We Mean It!)

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Unlimited paid time off is a common perk in the tech industry, but as one company discovered, an open-ended vacation policy led to confusion and even burnout. Dan Jimenez of Chatbooks comes on Rework to talk about how they shifted from unlimited to mandatory PTO, and how they’re recalibrating expectations for work, productivity, and rest during a turbulent time.


The Full Transcript:

Wailin: [00:00:00] In my younger days, I would get the burrito and then I would end up just eating the filling out of the burrito with a fork. You know, like you cut it in half and then you hold the burrito like it’s a cone. Just eat the filling out of it. And so it’s like, well—

Shaun: [00:00:15] No, don’t say that, like that’s a normal thing. Don’t “you know” me on this one.

Wailin: [00:00:20] I assume—

Shaun: [00:00:20] That’s a Wailin Wong bullshit thing.

Wailin: [00:00:22] I can’t possibly be the only one who’s held their half Chipotle burrito like a cone and eaten the filling with a fork.

Shaun: [00:00:30] You can. You can, in fact, be the only person.

Wailin: [00:00:35] Alright, if anyone else has done this, will you email us at hello@rework.fm

Shaun: [00:00:40] We’re gonna do a full story on how weirdos eat burritos.

Wailin: [00:00:44] Well, I just don’t think it’s that weird.

Shaun: [00:00:46] Do you wanna start this?

Wailin: [00:00:48] When I was at Chipotle, I’ll just—

Shaun: [00:00:48] Oh my God.

[00:00:50] Broken By Design by Clip Art plays.

Wailin: [00:00:54] Welcome to Rework, a podcast by Basecamp about the better way to work and run your business. I’m Wailin Wong.

Shaun: [00:00:59] And I’m Shaun Hildner. So Wailin, when was the last time you took any time off?

Wailin: [00:01:04] Well, it was definitely in the before times. I think, I want to say, late January. I went to New York for one and a half days to do an oral history workshop at Columbia.

Shaun: [00:01:16] Wait. That’s not a vacation.

Wailin: [00:01:19] Well, you know, even though it wasn’t sitting on a beach, it felt really relaxing because I was traveling by myself, not with a child, and doing something that was for my own enjoyment. And then I even got to go to a movie by myself, which is such an exquisite pleasure. I went to see Knives Out all by myself.

Shaun: [00:01:39] Oh, I really enjoyed that movie. I really miss going to movies, too. Man—

Wailin: [00:01:42] Uh, same.

Shaun: [00:01:44] This is the worst.

Wailin: [00:01:45] This is the worst. Well, I’m just grateful that I got to see Chris Evans in that cable knit sweater before everything fell apart. When was the last time you went on vacation?

Shaun: [00:01:56] I actually went to Japan in February, right before lockdown. We were there for maybe 10 days, me and a group of friends. And I remember sitting at a sake bar in Yokohama. And the bartender was saying, oh, if you look right outside the window there in the harbor, that’s the Diamond Princess, a cruise ship that was not allowed to dock because of too many coronavirus cases.

Wailin: [00:02:22] Get out. Really?

Shaun: [00:02:24] Yeah. And at that point, it kind of hit us all. They’re like, oh, we, uh, we need to get out of here. This is this isn’t going well.

Wailin: [00:02:32] Oh, wow. I didn’t realize you saw one of those cruise ships. Like, on your vacation.

Shaun: [00:02:35] It was really bizarre.

Wailin: [00:02:38] Oh, jeez.

Shaun: [00:02:39] I did take some time off in August, though. Just here around the house. I just took a week off. I’m gonna be honest, I checked in at work a few times.

Wailin: [00:02:45] Yeah, well, the two of us are notoriously bad at taking time off and unplugging as I think we’ve covered on this show before. But we’re not the only ones. A lot of people struggle with leaving work aside. At Basecamp, we’ve also had to rethink how we approach our paid time off policy. We used to have unlimited PTO, thinking that would give employees the most flexibility, but it actually caused more stress for people. So we changed our policy in 2015 to give employees a set number of vacation days, which I guess you and I are still bad at taking.

Shaun: [00:03:19] Okay, this is not a failsafe plan. We actually talked about this on the show a couple years ago. But on today’s episode, we thought it would be helpful to hear the perspective of another company that did something similar and rethought its unlimited vacation policy.

Dan: [00:03:42] I’m Dan Jimenez, and I’m the President and COO of Chatbooks.

Wailin: [00:03:45] Chatbooks was founded in 2014 and makes photo books and gifts. They’re based in Utah. And until recently, they had a PTO policy similar to Basecamp’s old model.

Dan: [00:03:56] Part of the trend over the last half decade or decade plus is has been to have this unlimited PTO at tech companies. That was the model that we have been following since the beginning. Provides a lot of you know, perceived flexibility. And I would say that, by and large, it’s been really great for our company and for the culture. We’re relatively small. We have a great set of co founders and a leadership and executive team that I think has done a pretty great job of modeling the behavior of you should take your time off and not feel pressured to totally burn out. But I think that us, like everyone else, it’s just so hard to avoid when you’re a startup and there’s just more work to do than you can conceive of doing in a regular work week. And so everyone’s always very busy and it can be hard to take time off.

Wailin: [00:04:43] How would employees take their PTO? Would they just have to give advance notice to their manager?

Dan: [00:04:49] Yes, right. Yeah. So, we use this analogy of you know, Chatbooks is an all star team so we have players and coaches. And so you’d go to your coach, you say like, hey, planning on taking some time off. More often than not, it’s not a problem at all. It was very loose, and there was no tracking of it. It was hard to know, looking backwards, how much time a certain person had or had not taken off. And then I think that that was kind of what led to the change recently was that starting to build up with certain team members that hadn’t taken enough time off, that it was starting to kind of come through in their work, or just in their general kind of way that they they were working and communicating with their team members.

Wailin: [00:05:31] Would managers take time off? Did the you know, co founders and people at your senior level of the company, would they take time off?

Dan: [00:05:38] Yes. And I think that that changed as we were able to expand the team. In the early days, when it’s a small team, you feel the world is on your shoulders, and there’s just not redundancy, then it’s much harder. I know that Nate, our CEO, and co founder, he went years without taking more than a three or four day period off in one stretch. And when I and other members of our executive team were able to join and kind of start to pick up more of the responsibilities he was able to finally take that first week off vacation, in probably year three or four of the business.

Wailin: [00:06:11] And did you take any time off? That first year?

Dan: [00:06:15] Gosh, no, I can’t think of… And when I say taking time off, we’ve always been very flexible about like a day here a day there. So for sure, when it was like, an afternoon, here and there, certainly. But no, I didn’t take a full week off for the least the first two years of the business.

Wailin: [00:06:31] Was it because you just felt like you had so much on your plate? Or you were still getting settled in that you couldn’t do it?

Dan: [00:06:36] Yes, yeah. So much on my plate, not wanting to let everyone else down. Maybe there’s a perceived false sense of, “Oh, I’m the only one that could do this particular thing.” And so it’s all on me. And that, I think in retrospect, was probably the wrong mentality to have.

Wailin: [00:06:52] And then would you encourage your employees to take their time off? Or how did that work in terms of managers, because I know it’s not tracked. But would certain managers remember to gauge the temperature every once in a while?

Dan: [00:07:06] Early on, it was not well communicated from the managers to be like, hey, you should be taking some time off. But it started with Nate, our CEO, to me, and then from me, to my direct reports, and so on, where he did an excellent job of like, look, you need to take this time off, you needed to be taken it off more often. I want you to bring your best self to work and in order to do that, you have to take these breaks and really disconnect.

Wailin: [00:07:31] What do you think your CEO was noticing about you? Or what were you noticing in yourself that necessitated taking that time off?

Dan: [00:07:39] Oh, man, I was very irritable at times. I was definitely the one who had like, “Oh, well, yeah, you just came back from a week on the beach. And it’s been really hard back here at the office.” And I knew I was kind of having a terrible attitude about things at times. I could pick up on that. Others would pick up on that. And it just wasn’t fair to the others who were actually using the unlimited PTO as as intended, when I wasn’t.

[00:08:05] And then you would see it and other folks, too. And then you’d start to think like, man, how long has it been since this particular team member has really been able to disconnect? And you think about it, and gosh, it’s been way too long.

Wailin: [00:08:16] Had you experienced this kind of burnout before at previous jobs?

Dan: [00:08:19] Yes, when I was straight out of undergrad, I actually worked as an engineer at a NASCAR race team. And the pace in professional sports, and specifically in professional motorsports is pretty insane. The season goes from mid-February to mid-November, but in those winter months, you’re still testing. And so, every single week, there’s travel involved. That pace got me accustomed to it. And so when I got into startups, I felt, no I can do this. I can do long stretches, I’ve done it before.

Wailin: [00:08:49] And then in terms of coming up to this policy change, at what point did it coalesce from maybe just managers making observations about themselves or their reports into let’s have a meeting and talk about this or let’s start a conversation about a formal change to the company policy?

Dan: [00:09:09] 2020 and everything that has come with it has been the catalyst. We were very much, prior to quarantine, a we work in the office, we believe that it’s optimal to be working together in person for creativity and productivity. That was something written in our culture book. And so it was a very new for us to say, everyone go home. Because of that and because of all the travel restrictions that were in place, vacations had been canceled, trips got put on pause and there was pressure to react. We went through waves of it being really hard. Revenue getting cut in half, right out of the gate when everyone went into quarantine to a big rush back in April and May.

[00:09:47] So it just felt nonstop all the way into August and even right now into Q4, which is the biggest time of the year for us. And we just were starting to observe that very few people are actually taking extended trips because you know, where do you go, right? We just started to feel it around the company, just observing everyone is starting to burn out. That was I think the genesis of this mandatory PTO policy.

Wailin: [00:10:10] How did you observe burnout once you went into a remote environment?

Dan: [00:10:15] That is a great question because it’s hard. Sometimes you can see it in the whites of their eyes when you’re in person. But but when it’s over Zoom or over Slack, it’s a lot more nuanced, right?

Wailin: [00:10:26] Yeah, everyone looks like a zombie on Zoom.

Dan: [00:10:28] Yeah, no matter what you’re gonna look like a zombie already, right. But we have a regular cadence of one on ones, between coaches and players. Most often it’s not talking about work related stuff and more of a, how are you doing, and I think that’s a tone that’s been set from the top and Nate and Vanessa, our co founders have been great at that. Just caring deeply about your team.

[00:10:47] I recall a particular day back in May, that was just really heavy. We had all the pains and challenges of 2020, with some extra stuff, you know, personal life stuff involved in it as well. My mental health was coming to a breaking point on that day. And Nate was just so open and helpful to me at that point. But I think we were realizing then, I have to disconnect.

Wailin: [00:11:12] Do you also have a lot of employees with school-aged children who are dealing with that, too?

Dan: [00:11:18] Yes, half of our 150 plus team members are our customer support team, and they are predominantly mothers working from home. And so for that team, we just had to get super flexible, size up the team a bit to be able to have more redundancy and to be able to lower everyone’s staffed hours. That just required a lot of flexibility and understanding to say, we know you are grown up. I’m not going to micromanage your time, I’m not going to expect you to be at your desk, uninterrupted from 9am to 5pm. That’s just not how it’s going to work in this world of work from home and quarantining kids doing school over Zoom.

[00:12:02] We have this principle that we call eight amazing hours, we believe you should split your life up into eight amazing hours of work eight hours of you know, personal life, and then eight hours of sleep. Eight amazing hours had to then kind of switch to 40 flexible hours. We’re going to put in our work, we’re a venture backed startup with the same amount of aspirations as the next company. But it’s just not realistic in this world to expect somebody, especially, with all the distractions at home, to just be chained to your desk from nine to five. And so we’re grownups and we’re going to find the way to work that works best for us to ship the work that we all aspire to do.

Wailin: [00:12:38] Yeah. And I don’t know what kind of relationship you have with your investors. But were they understanding about this flexibility as well, to the extent that they were paying attention to kind of the minutiae of how you run the company?

Dan: [00:12:51] Yes, this is one of the few times I think investors and board members were going through the same personal or professional challenges as their portfolio companies. And so I think there was just a lot of understanding and trust to maneuver our way through it, just as they were tried to do it at the same time.

Wailin: [00:13:09] The disruption caused by COVID led Chatbooks to be more flexible in how they looked at their employees time and productivity. But it didn’t stop there. The management team decided to make a formal change from unlimited to mandatory PTO.

Dan: [00:13:22] There definitely was some back and forth discussion on how to structure it. We had gone from saying unlimited PTO to starting to say the words, you should do something like a week, every quarter, but it was very loose. And then there was always confusion around what about, what about Q4 because we’re a consumer business. And even more especially around photo books, we have a high percentage of our revenue that happens during about five weeks of the year. And so Q4 is a special animal. How do we manage time off during that period when it really is all hands on deck. And so we had that discussion and landed on the policy that we have now where it’s everyone should take at least at a minimum, one week or five consecutive business days, in Q1, 2, and 3. And then in Q4, we have a blackout period of October 1 to December 23, where it’s all hands on deck, and then we all take a winter break off together where the company essentially shuts down from after Christmas until we all come back in January. And that’s where we landed.

[00:14:26] And again this is a minimum, right? We’ll have employees who are from overseas and they want to be able to go home and a week is just too short to string together an international trip. And so, work together with your coach to figure out what that appropriate amount of time is to be gone. We still have unlimited untracked personal time. That really wasn’t the concern for us. The concern was reliably having everyone disconnect on on a regular cadence. And so it was you know, setting that minimum expectation and then putting together the policy of the player is going to be responsible for taking the time. We can’t really force them to take it’s on them to do it. The coach is responsible for communicating and making sure that they know that they should be taking it, and that it’s in their plans to be taken. Our HR team is responsible for tracking it and doing the audit after every quarter to see how well we did.

Wailin: [00:15:16] So it’s a mandatory minimum PTO, and then kind of unlimited flexibility on top of that.

Dan: [00:15:23] Yes. Yeah, it’s a bit of a hybrid.

Wailin: [00:15:25] And then, in terms of this kind of all company break that you take right after the holidays, does that include your customer support team as well or does some skeleton crew need to stay behind to handle people who are calling in with questions about redeeming gift cards or whatever after the holidays?

Dan: [00:15:41] Yeah, great question, our customer support team operates a bit differently, because just as you said, on December 23rd, the customer inquiries do not stop, they carry through in high volumes all the way through. And so we have to plan that, because we want our customer support team to have the expectation that they can have an enjoyable holiday with their families, right? We don’t want them to feel like oh, it’s all on me. And so my holiday is ruined by my job every year. And so that requires us to flex up the size of that team during the holiday almost 2X. And so we have a lot of temporary or seasonal customer support reps that join us so that we can keep those expected or required number of hours at a reasonable level. And then outside of that super busy season, then providing a lot of flexibility for that team to be able to take time off, when the demand in traffic from customer inquiries is low.

Wailin: [00:16:36] Yeah, you know what I also find really interesting about your new policy is that you require that the days are continuous, right? It’s like you’re going for a specific goal to unplug which, you know from experience you cannot do just by taking off one day here and there.

Dan: [00:16:52] Yes. Yes, that was on purpose, because we had observed it with employees, including myself, where it was like, I’m gonna get my weekend, but I’m gonna do a day here and a day there. It just does not have the same effect, I think, on our mental health, as putting together five continuous days. There’s no real expectation that those five days need to be spent in Bali or Paris, right? You can disconnect from anywhere. So for my mandatory time off, I just stuck around town. And we went up into the mountains for a couple of days, went on bike rides, spent time with my kids pulled them out of school, and just had a really great time disconnecting here locally.

[00:17:30] And so there isn’t an expectation around where you have to go for the week, it’s just that you need to disconnect and not be on Slack, not be checking your email, but really disconnect. And that can be from the beach, it can be from your backyard. We’re not going to tell you where that or how that has to happen. but more that you just take the time off.

Wailin: [00:17:49] Did you find it really hard not to check your email and not to check Slack?

Dan: [00:17:52] Yes. Yes.

Wailin: [00:17:56] How’d you do it?

Dan: [00:17:56] It’s a creature of habit. I’m not gonna give myself an A+, but it’s the best I’ve done in a long time. And it also helped that we went up into the mountains where there just isn’t service anyway. And so, you have to delete the apps from your phones, you have to leave the laptop at home. Because it’s hard to kick that habit where you’re like, oh, I know I’m not working, but I’m just going to jump on Slack and see what’s up, and then you just get sucked into a thread of, oh, I can jump in here and help. And that’s just not, that’s not how we want to do it.

Wailin: [00:18:23] It’s like, in some ways you have to teach people how to unplug, because that’s not what our culture does. And so it’s… beyond having the policy, it has to be, no, you delete the app from your phone.

Dan: [00:18:35] Yes. And I would say our CMO, Rachel Hofstetter is an amazing executive. She does a great job at modeling this behavior, when she has taken her time off, too. And we all know she’s unreachable right now. And because she does that, it allows others and the folks on her team to feel that they can do the same when they go off.

Wailin: [00:18:53] What did you see other folks in the company doing for their mandatory week off especially in the third quarter when a lot of people are not traveling? Were there some interesting stories or just creative things that people were able to do during that week?

Dan: [00:19:05] I’ve seen a lot of people go to the National Parks for the very first time. We’ve had people who lived in this area in Utah their whole lives, but they’ve never been to Moab. And they’ve never been to Zion National Park or Arches. And so it was an opportunity to… maybe in a different year, I would have gone to California or I would have gone to Europe, but because I can’t I’m gonna explore amazing places that we have here closer to home. That’s what I saw the most.

Wailin: [00:19:30] What kind of response did you get from the Twitter thread you wrote up about changing the PTO policy and sharing a little bit of your own experience? Did you hear from people at other tech companies or peer companies?

Dan: [00:19:41] Yeah, the response that I heard overwhelmingly was, wow, this is different. This is the way that we should start thinking about it. A lot of people from companies that have unlimited PTO all were telling the same story, that unlimited PTO is a nice thing to say, but in practice, it rarely ever occurs and that you end up taking less time off than you would if you had a more traditional PTO policy.

[00:20:06] Separately, there were questions about people who travel internationally. I didn’t address that in the thread. There were questions around, you know, is it appropriate for a company to tell their employees when and how long to take their time off? And I think those are all very valid questions worth discussing and figuring out. In Twitter, there’s only so much detail I could give around the nuances of how we do it. And it’s hard to give the background on the culture because I think it really starts with the norms that you establish as a team. It’s more about that and the behavior that you model, then it is exactly what’s written in the company handbook.

[00:20:40] And so for us, the benefits are going to be seen in the norms that we start to establish, and that what you see the leadership team, the executive team and your coach doing, that gives you that kind of mental security that okay, I can do it this way. Because there’s words around it. We’ve talked about it at townhall, and we all have clarity around what the policy is, where before, I would say was more unclear what the norm was.

Wailin: [00:21:04] Yeah, that’s interesting, what you say about concerns about, oh, are we allowed to tell our employees to take time off and how much time but I think most companies, even if they’re not explicit about it, there’s certainly implicit expectations of maybe never taking any time off. So maybe it’s good to be explicit about taking time off.

Dan: [00:21:23] Yes. Yeah, that’s exactly where we landed. It’s better to add the clarity around it and be a bit more explicit and maybe run the risk of, oh, you rub somebody wrong who thinks, you shouldn’t be telling me like unlimited PTO means I have full flexibility. And it’s, you still do, but it was more about creating the clarity around the minimum and the cadence at which we think it’s best to take to maintain that energy and, really, mental health. I would say that we are figuring this out, just like everybody else. I think that we’re A/B testing our way into a more perfected time off policy and culture. And I love to hear from other companies and what they’re doing. We just recognizes that the quote unquote “unlimited PTO” without any definition, expectations, or norms just was not having the intended outcome and was having a lot of detriments, especially during 2020 when things just got turned upside down.

Shaun: [00:22:19] Rework is produced by Wailin Wong and me, Shaun Hildner. Music for the show is by Clip Art.

Wailin: [00:22:31] You can find Dan Jimenez on Twitter at @TheDanJimenez. That’s J-I-M-E-N-E-Z. We will link to his original Twitter thread where he talked about the policy change at Chatbooks. Chatbooks is at chatbooks.com.

Shaun: [00:22:44] We’ll also link to our previous episode about changing the PTO policy here at Basecamp. You can find these links in the show notes for this episode at Rework.fm.

Wailin: [00:22:55] We are on Twitter at @reworkpodcast. And you can also send us an email at hello@rework.fm. If your company has done anything interesting to help employees destress or take care of their wellbeing during this time, we would love to hear about it. So again, you can send us a note at hello@rework.fm.

[00:23:12] Broken By Design by Clip Art plays.

Wailin: [00:23:24] So you know how you and I have been talking about, because we’re now headed into colder weather and it’s gonna be like a long, tough winter and we need to practice more hygge? Am I saying that right? Hygge?

Shaun: [00:23:35] Hygge.

Wailin: [00:23:36] Hygge. And so I know that you are an expert in many cozy things like wool sweaters, you’re good at wool sweaters, you’re good at making soup. And—

Shaun: [00:23:51] That’s it. I can do sweaters and soup, the two esses. [Like the letter S]

Wailin: [00:23:53] You can do sweaters and soup and I really enjoy scented candles. We had come up with an idea where you and I would just talk about cozy things and then that morphed into this idea where you would review candles because I was telling you about these different scented candles and then you started buying them and you went on a little candle shopping spree. And then my husband came up with the title Shaun Wick. So then obviously we had to do a side podcast that’s just about you reviewing candles.

Shaun: [00:24:26] Okay, so periodically, I may pop on to review a scented candle.

Wailin: [00:24:31] I’m really excited.

Shaun: [00:24:32] Let’s see I have one from Boy Smells, which is some hipster candle brand. I got one of those literary candles from our friends over at a Hearth & Hammer.

Wailin: [00:24:43] Excellent.

Shaun: [00:24:43] And I recently spent way too much money on the A24 collaboration with Joya and got their movie genre candles.

Wailin: [00:24:50] How many? Was it like a full set?

Shaun: [00:24:52] I have five so far.

Wailin: [00:24:54] Wow. Do they smell like scary movies? What’s the premise of this collabo.

Shaun: [00:24:59] You know what, I’ve only lit a couple of them so far so we’ll have to wait to to hear my review of those.

Wailin: [00:25:04] Oh, okay, so which one have you burned the most?

Shaun: [00:25:06] As we’re recording this it is very close to All Hallows Eve, the time in which the veil between this world and the next is at its thinnest. So the horror genre candle from A24 x Joya is… it’s a lot.

Wailin: [00:25:21] What does it smell like, the horror candle?

Shaun: [00:25:24] So let me light that up. [Sound of a candle being light and blown out, followed by Shaun taking a deep inhale of candle smell.] You know, it smells like a red satin dress that your date is wearing when you invite her over to your apartment on Christmas Eve. You know, it’s like your first time being alone for the holidays and she’s not going to see your family until the morning so you figure you can make a date of it. You have some garland up on the mantel because you’re pretending to be an adult. So a lot of the ambience is coming from the smell of pine sap and dusty radiators that just turned on. You have this whole big dinner plan but then you end up drinking red wine all night until you both fall asleep on the couch. And she gets up early, heads out to go meet up with her family for Christmas, and a couple of months later you two aren’t really talking anymore.

Wailin: [00:26:09] Wait a minute. Are we still talking about the candle?

Shaun: [00:26:11] Yeah. That’s my review of the A24 x Joya horror genre candle. Should we continue the A24 reviews or would you like to move away for a little bit? I could do The Raven.

Wailin: [00:26:27] Ooh! We could do The Raven, yeah.

Shaun: [00:26:29] Let’s do the raven next.

Wailin: [00:26:30] Okay, okay. How exciting.

Shaun: [00:26:31] Well, tune in next time for the podcast within a podcast, Shaun Wick.

Wailin: [00:26:39] Does no one want to hear my review of the White Pumpkin candle from Bath and Body Works?

Shaun: [00:26:44] I do want to hear your review of the White Pump—ew.

Wailin: [00:26:48] My kid was like it doesn’t smell like a pumpkin at all. She was outraged. I was like, it’s subtle. It’s subtle. I do not—

Shaun: [00:26:56] Do you know what I found smells really good this year?

Wailin: [00:26:58] What? What?

Shaun: [00:26:58] I roasted pumpkin seeds as I do every year after carving jack o’ lanterns. And instead of just salt I used some togarashi.

Wailin: [00:27:08] Oh.

Shaun: [00:27:08] As the seasoning. It’s a little bit spicy but really fun. Cannot recommend it highly enough.

Wailin: [00:27:15] How fancy. See, this is so good because it’s like we’re not just talking about candles. We’re talking about a full spectrum of cozy activities and that fits right in.