This is *NOT* offering employees "unlimited time off". My company has this, we call it "balanced time away". Instead this is a flexible policy where managers work with their underlings to decide what is an appropriate time off and when.
Ideally, it could be quite beneficial, for instance, if you work really extra hard for a few weeks to make a delivery, and the manager can recognize that and reward it by agreeing to some additional time off to celebrate and recover. Or if family stress outside of work mounts, a manager can encourage some time away to help avoid a breakdown.
BUT, there are two major problems. 1) Because this is not a system, there is no tracking, and no seniority. If you've been with the company many years, and you are accustomed to an extra week and a half of annual vacation, it is easy for that to be trimmed away. Even if you deserve your 2 weeks as a new hire, it's easy for that to be trimmed down. 2) What if you have a nice manager, good with people who believes in reward, but your friend and colleague has a mean, parsimonious manager who believes in the strength of fear? Will there be fair and even treatment across the organization?
These are two *HUGE* problems, and it entirely depends on your corporate culture how it's going to come out. I hear Microsoft maybe doesn't have the nicest culture in the first place.
P.S. I avoided the term "bullsh--" in my post, but I sure did want to use it!
In specifications, Murphy's Law supersedes Ohm's.