The CEO of a marketing company says he pays his employees $2,000 a year to go anywhere and do anything and they are more productive than ever.
Mark Douglas, CEO of SteelHouse, a cloud-based digital marketing and advertising company and advertising firm based in Culver City, California, told Business Insider that he came up with the idea to pay employees to take vacation in 2011, a year after the company launched in 2010.
"If you have a caged lion that was born in captivity, and then you open the cage, they back up more into the cage. They don't start running free," Douglas said. "When we first started telling people they had unlimited vacation, they didn't even know how to interpret that."
Business Insider reported that long as what employees do on vacation is legal, they can go anywhere and do anything with the $2,000 a year the company pays for them.
Employees can use all the money at once or spread it out across multiple trips, but the process is one of trust: Employees front the the money for the trip and are reimbursed by the company.
If they can't front the money, SteelHouse lets employees use the company credit card to book their flight. When employees return, they can expense their costs for up to $2,000 in reimbursement.
"It's one thing to say 'You have three weeks vacation,' like most companies do," he said. "It's another thing to say 'You have cash, and if you don't go on vacation and spend this money, the money literally goes to waste.' It's another level of saying this is real."
But if an employee doesn't want to take anytime off and would rather have the $2,000 up front, it won't happen: "I actually want you to go somewhere and enjoy yourself," he said.
The policy seems to be working -- Douglas said the company has had "virtually zero turnover."