- Some companies are paying people thousands of dollars to quit their jobs.
- The technique is giving employees the power to pursue a future they want, experts say.
- "It opens a window to a much more self-determined employee experience," Ralf Specht told Insider.
The current state of the US labor market has left some businesses struggling to find and retain staff amid a seemingly never-ending labor shortage.
At the same time, however, some companies are paying their employees to quit their jobs altogether.
While it may seem odd at first, it is in fact a technique that has helped corporations keep hold of their employees. Experts say that it also empowers workers to take full control of their future by deciding whether they are happier staying at a company or not.
The technique was pioneered by the late former CEO of online retailer Zappos, Tony Hsieh, and was designed to filter out those who would not be as committed to and passionate about their work at the company.
Hsieh told Insider in a 2016 interview: "We want to make sure that employees aren't here just for paychecks and truly believe this is the right place for them."
The program, which was labeled "the offer," presented unhappy new employees with a $2,000 bonus to quit, following a four-week training period. The policy was later inherited by Amazon after it acquired Zappos in 2009.
Since then, more companies have followed the trend. Chris Ronzio, the CEO of Trainual, a software company in Arizona, instituted the policy at his firm in May 2020. He offers employees $5,000 to quit after two weeks if they have any sense of doubt.
He told Insider the technique empowers employees to the fullest extent. "This sort of strategy puts employees in the driver's seat and lets them know that we recognize the fact that at any time, they can leave and find a better opportunity," he said.
Ronzio said that giving employees a financial incentive "really gives the employee the power to make a decision they feel is right for their future."
When asked how the technique impacts him as a leader, Ronzio said: "If a leader doesn't want to empower their people, I don't think that makes them much of a leader."
People don't stay at the same job forever like they used to, according to Ronzio, but they'll stay as long as they're happy, fulfilled, and productive. "It's a partnership, and employers need to treat it as such," he said.
Last November, Embark, a financial advisory firm based in Dallas, also started using the technique. It offered $10,000 to each employee on a one-off basis, in an effort to allow staff to reflect on whether the job was right for them or not.
"We thought perhaps what we do isn't for everyone so this was an opportunity for our employees to assess," Paul Allen, the founder and chief vision officer of Embark told Insider.
Allen said that four out of the 300-plus employees at the firm took the offer so the technique was very effective in clearing out people who weren't motivated to stay at the company.
Abby Sesker, an employee who chose to decline the bonus and stay at Embark, told Insider she "was not tempted by the offer."
"I think the technique empowered people to take ownership of their careers," she said.
Ralf Specht, author of "Building Corporate Soul" and expert in corporate culture, said also believes that paying people to quit has the potential to empower employees. He told Insider that it requires the organization to create a hiring and on-boarding process in which co-workers are involved.
"It opens a window to a much more self-determined employee experience. And that is highly relevant for millennials," he said.
Both Ronzio and Allen hope the technique will stick around and become more popular among companies.
"This choice holds firms accountable and that makes them better companies to make a positive difference, internally and externally," Allen said.
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