Saturday, May 31, 2008

Why Zappos Pays New Employees to Quit—And You Should Too


Ever heard of a “Quit-Now” bonus for new employees? We’ve all heard of severance packages where long-standing employees are essentially paid a bonus to quit now. But a “Quit-Now” bonus for new employees to voluntarily leave after a week on the job … that’s novel.

Bill Taylor, of Mavericks at Work fame, writes how Zappos , a fast-growing online shoe retailer, will offer one-week old employees a “Quit-Now” bonus of $1,000. Zappos will ask new employees this question … “If you quit today, we will pay you for the amount of time you’ve worked, plus we will offer you a $1,000 bonus.”

Why does Zappos do this? The reasoning, as Bill Taylor put it, is …

“Because if you’re willing to take the company up on the offer, you obviously don’t have the sense of commitment they are looking for. It’s hard to describe the level of energy in the Zappos culture—which means, by definition, it’s not for everybody. Zappos wants to learn if there’s a bad fit between what makes the organization tick and what makes individual employees tick—and it’s willing to pay to learn sooner rather than later. (About ten percent of new call-center employees take the money and run.)”


Tony Hsieh, CEO of Zappos, provides his 10 tips for building a customer service focused culture.

Whichever is your media of choice, the deal is that for a virtual company to have such a strong connection with its customers, they must be doing something right.

All employees that are hired into their corporate office, regardless of position, are required to undergo a 4-week Customer Loyalty Training course, which includes at least 2 weeks of talking on the phone with customers in the call center.[7] at full salary. After training the new employees are offered $1000 to leave the job immediately.[7] This is to ensure people are there for the love of the job and not the money. Over 90% turn down the buyout.

Great job Tony. And move over Southwest. I've just found a new case study for my toolbox.

I have emailed Tony who graciously offered me a free copy of his culture book. More to come.

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