Paid Leave 2.0: Why Some Companies are Paying Their Workers to Quit

ca$h moneyHave you ever started a job and realized that it was not what you thought it would be? Or have you ever hired someone who seemed like a perfect fit in the interview and then was a total dud when they were on the job? Most of us have.  But in a novel approach, some companies have taken charge and started to pay their employees to quit.

New employees at Zappos are offered one month’s salary in the first three months of employment to quit. The offer, officially called the “Graceful Leave Policy,” is extended to all new hires two weeks in to training. All new employees, not just the underperforming ones, have three months to act on the offer.

The idea behind it is to allow workers to pursue another job if this one is not for them (and to not feel financially hindered in doing so). Zappos’ director of new hiring, Megan Petrini, said in an interview, “We want you here because you believe in the vision and the goals of the company and can make a difference.”

A program like this has its costs and benefits. For starters, talented employees with many opportunities may use this as a chance to try out a company and then leave, with an extra month’s salary, for a better job they had planned on taking in the first place. This leaves the less-sought-after employees to stick around for the long haul.

On the flip side, companies can use this as a gauge for how they are doing with hiring. If they have a lot of new hires leave after a few months, they may need to reassess their procedures, from where they’re posting jobs, to how they’re evaluating and training successful candidates. If most of their new hires stay, they know that it is because they want to, and they turned down a financial incentive to do otherwise.

A program like this might not work for every workspace, but it is an interesting trend to monitor.