What if instead of bureaucracy, a booming company relied on common sense?
BY Drake Baer | March 10, 2014
Back in 1997, before it was streaming a billion hours of Internet television a month, Netflix was a startup. They had a fairly standard vacation policy: 10 vacation days, 10 holidays, and a handful of sick days per person. Rather than formally tracking these days, they opted for an honor system, with employees tracking their own off days and informing their managers when appropriate.
Then, in 2002, Netflix went public.
“(O)ur auditors freaked,” former Netflix chief talent officer Patty McCord writes in HBR. They thought that Sarbanes–Oxley, the accounting reform legislation, required that time off was carefully accounted for.
Netflix thought about putting an official system into practice–until founder Reed Hastings came up with an intriguing question: “Are companies required to give time off? If not, can’t we just handle it informally and skip the accounting rigmarole?” McCord’s realization: no California law said you had to institute vacation time.
Read the full article @FastCompany.