Dave Ramsey Slams Young Employees' Unpaid Time Off: 'You Think You're French?'

Addressing Unpaid Time Off: A Manager’s Dilemma

A growing concern among managers in small businesses is the increasing trend of younger employees taking unpaid time off after exhausting their paid time off (PTO). This situation has left some leaders unsure of how to respond, especially when there are no clear policies in place. Recently, a vice president from a 21-person company with annual revenue of $10 million reached out for guidance on how to handle this issue.

The discussion took place on the “EntreLeadership” podcast, where host and entrepreneur Dave Ramsey shared his approach to managing time off. According to Ramsey, his company offers various forms of time off beyond standard PTO, but these are reviewed by an HR committee that determines whether they qualify as an act of grace. He emphasized that he does not support unpaid time off, stating, “I don’t do unpaid time off because I want to take a vacation and I’ve used up my PTO. You need to be at work. That’s why we hired you.”

The Issue of Flexibility and Expectations

Ramsey acknowledged that there are situations that may require flexibility, such as when an employee is undergoing medical treatment. However, he drew a clear distinction between genuine emergencies and casual requests. For instance, he mentioned that if someone says, “I just came off vacation and I think I want another one… I don’t really care if I get paid or not,” it signals that the person may not be the right fit for the job.

This attitude, according to Ramsey, often stems from a lack of work ethic and a sense of entitlement. He sarcastically remarked, “You think you're French or something,” referencing European norms around generous vacation policies. While he supports flexibility and work-life balance, he believes that employees should respect the boundaries set by the company.

The Growing Problem Among Younger Workers

The caller shared that four of his employees had taken unpaid time off last year, and he expects five more this year. Ramsey wasn’t surprised by this trend, noting that it tends to be younger workers who are more likely to engage in this behavior. He suggested that this mindset often leads to poor planning or laziness, which can ultimately result in those employees leaving the company within about six months.

Resetting the Company Culture

To address this issue, Ramsey recommended a two-part solution. First, resetting expectations across the entire company. He advised making an announcement to clarify that only PTO would be allowed for time off, with exceptions requiring approval from management. Second, having one-on-one conversations with employees who repeatedly exceed their PTO.

He emphasized that enforcing these boundaries isn’t about being harsh, but about maintaining accountability and fairness. “We’re kind about that. We love our people. We’re not mean to our people,” Ramsey said. However, he made it clear that if an employee resists these expectations, they may not be the right fit for the company.

A Word on Remote Work

Ramsey also took a jab at remote work, suggesting that some employees seek flexibility and work-life balance as a way to reduce their workload. “I want more flexibility and work-life balance. Translation: I want to be paid for eight hours while I really only work about four,” he said.

Taking Action and Moving Forward

In closing, Ramsey encouraged the caller to take action and handle the situation decisively. He praised the manager’s leadership and confidence, saying, “You’re going to handle it well. You sound like a very solid, mature leader.”

By setting clear expectations, communicating openly with employees, and enforcing boundaries, managers can create a culture that values accountability, fairness, and professionalism. This approach not only helps maintain productivity but also fosters a positive and respectful workplace environment.