A couple of years ago, Zappos became famous for radical user-centricity and employee happiness. Amongst other things, they offered their employees $1000 to leave the company. CEO Tony Hsieh was often quoted that he wanted to build a culture with a high level of energy that he understood was not for everyone. The $1000 was supposed to be the Litmus test — are you really in for this?
Amazon not only bought Zappos but also copied the same commitment check which they extended to $5000. An Amazon spokesperson commented (1): “We want people working at Amazon who want to be here. In the long-term, staying somewhere you don’t want to be isn’t healthy for our employees or for the company.”
True, according to Gallup’s latest study (2), unhappy and disengaged employees cost a company 34% of their salary — even a small company of 15–25 people could save upwards of $300k per year if they could get engagement back on track.
So should you pay your (unhappy) employees to leave?
On the one hand, a financial incentive can work great since you want to filter out people who are extrinsically motivated and obviously don’t love the job. If you take $1000 and leave the company, there is little to no intrinsic motivation, it seems.
Your best employees are those who align with your company or organization based on purpose and values. If the purpose of the organization mirrors the value set that drives an employee in life, they are more likely to be happy. In its purest form, people fight for a purpose even without compensation at all — something many non-for-profit organizations experience.
With this in mind, there is also something fundamentally wrong in offering cash to leave. It motivates people to think negatively about what they are doing since people want to find a reason why they should take the money. In the end, if your intrinsic motivation won and you stay, this offer may still have planted a seed in the back of your mind that you come back to frequently thinking: has this been the right decision?
Maybe an incentive to stay based on commonalities in purpose and values would work better. The longevity of positive thinking should outperform the effect of cash offered. This could have been the reason why Zappos chose a very low cash value — so you wouldn’t think about it too much and dismiss it right away.