CEO of software company offers new hires $ 5,000 to quit after two weeks – and says it helped him retain top talent

• Trainual is a software company that takes an unusual approach to staff retention.

• The CEO told Insider that paying newcomers to leave helps maintain a strong company culture.

• “It’s a powerful thing for them to refuse the money, to accept and to commit,” he said.

Many business owners across a wide range of industries have struggled to find and retain staff amid a nationwide labor shortage.

In November, a record 4.5 million Americans left their jobs. In many cases, people cited poor working conditions and low wages as factors.

In an attempt to secure workers, companies increased wages, offered hiring bonuses, and provided education benefits to attract more staff. But even amid these changes, the labor shortage persists into the New Year, and a study conducted in November 2021 suggested the problem may persist beyond 2022, despite employers’ efforts.

One company, however, has found a new approach to finding and retaining workers.

Chris Ronzio, CEO of Trainual, an Arizona-based software company that helps small businesses onboard, train and grow teams, told Insider he pays employees to quit. He said the strategy helps it retain top talent in the industry as well as maintain a strong corporate culture.

“With today’s market, recruiting teams must act quickly to assess candidates and lead them through the process towards a competitive offer, so it’s impossible to be right 100% of the time,” he said. Ronzio said.

He added: “The offer to step down allows the dust to settle out of a quick process and let the new team member throw a red flag if he feels anything but excited.”

Ronzio instituted the quit payment policy in May 2020. At the time, the company was offering employees $ 2,500 to quit after two weeks if they had any doubts. None of the 38 people they’ve hired since the policy was implemented have accepted the offer. The company recently increased the amount to $ 5,000.

“We looked at our average salary when we looked at changing the amount and finally figured if someone is making $ 80,000 or $ 100,000 a year then $ 2,500 might not be big enough,” Ronzio said. . “They might decide to stay while they look for another job because they will earn more. So we adjusted the number with that in mind.”

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As an employer Ronzio said he was responsible for creating an inclusive culture. He thinks giving employees a financial incentive and the power to “fire the company” sends a compelling message in strengthening the culture. “It’s a powerful thing for them to refuse the money, to accept and to commit – and it sets the stage for a great working relationship,” he said.

It also holds the hiring team accountable because there is a cost to the company if they get it wrong, Ronzio said.

The logic behind the two week window is that there is less disruption to the business than there would be after a longer period of time, when the business has invested more in the employee.

But what about the employees who decide to stay? Ronzio said employees do not receive any specific incentives to continue with the company. “Those who turn down the $ 5,000 are missing something ‘extra’ at this point in the timeline, because they think the long-term value of staying with us is worth much, much more.”

Read the original article on Business Insider