HR Management & Compliance

Bonus to Quit? Zappos Tests New Hires Loyalty

In a special report from the SHRM 2011 Conference, Steve Bruce reports on Zappo’s Tony Hsieh, who spoke in a presentation about company culture, customer service, and a unique method for reducing employee turnover.

Focus on your culture, and the profits will follow, says the Zappo’s CEO and author of Delivering Happiness: A Path to Profits, Passion, and Purpose.

Hsieh revealed that the company hires for culture. New applicants go through two interview processes, one for “the normal things,” like skills and abilities and experience, and one for cultural fit. If applicants don’t pass the cultural fit interview, they won’t be hired, no matter how good their skills or how great their ability to contribute technically.

Interviewees are met at the airport and driven to Zappos’ headquarters for interviews. After the interviews, the limo driver gets his or her say on whether the person should be hired. The lesson? Treat the driver or receptionist poorly and you won’t get the job.

If an applicant accepts an offer of employment, he or she must then go through a 4-week training program that includes 2 weeks of taking customer calls. The obvious benefit is getting everyone attuned to the customer service standards of the company. And there’s a bonus, Hsieh says; during holidays and heavy sales periods, anyone can (and does) start answering phones. They never need to hire temps that might not uphold the high customer service standards of the company.

The Final Test

Once the 4-week training period is completed, new hires are offered a final test: a $3,000 bonus to quit. Hsieh says that it’s Zappos’ way of saying that they only want people who really want to work here. On average, two or three percent of trainees take the bonus and leave. Zappos believes that this is money well-spent, as those who take the bonus probably wouldn’t have lasted long anyway.