True, but that's not entirely bad. It even further encourages you to actually take your vacation. Since there's a checkpoint at the end of the year, you should never have more than a year's worth of vacation "saved up", and really, a policy like this wants you to take vacation slowly and steadily and never burn out.
Also, if you're a US worker and your employer is yelling at you for taking fewer than 5 weeks off, not including public holidays, you're in a pretty awesome situation.
Most years, I schedule a solid 2 or 3 week vacation to completely unplug from the office. For US people, that would consume most of your "socially acceptable" vacation time allotment during a calendar year. That particular year, my 3 week vacation was scheduled for September and I get laid off in July, so yes, it was entirely bad.
At my next job there was an annual allotment of 3 weeks of vacation that accrued little by little every pay period. I was able to "borrow" time from the next year so that I could take my already-booked vacation. And, for the duration of that job, I maintained a negative vacation-time balance vowing to not get screwed again.
Unfortunately, whenever I hear of the "fantastic unlimited vacation time benefit," I can only view it as a way for the CEO to milk an extra month of work out of employees before laying them off at no cost.
Also, if you're a US worker and your employer is yelling at you for taking fewer than 5 weeks off, not including public holidays, you're in a pretty awesome situation.