Lessons from a company that gave lay-offs the boot

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● Many businesses want to portray themselves as one big happy family but Next Jump, a US employee loyalty reward company, has gone a step further with its “no fire” policy. “We think of hiring someone more like adopting them into the family,” says co-founder and UK managing director Kevin McCoy. “You wouldn’t fire your own kid, would you?” Some might disagree.

In theory, a Next Jump employee cannot be sacked for poor performance. Instead, their manager is expected to coach them into improvement or, if that fails, move them into a different role. Unsurprisingly, Mr McCoy admits managers — desperate not to make a bad hire — have become reluctant to fill positions.

Not only does the company claim not to sack anyone, it says it would not make anyone redundant. “There would need to be two massive economic disruptions simultaneously, lasting 24 months or longer, for us to even consider lay-offs for economic reasons,” says Mr McCoy. “If we found ourselves in such a dire economic time, I still believe we could find a way to survive and not lay people off.”

The “no fire” policy is informed by Next Jump’s turbulent history. Founded 20 years ago, it grew to 150 people before the dotcom bubble burst in 2001, when Mr McCoy became one of only four surviving employees. The experience was clearly traumatic.

“No fire” was introduced in 2012 to improve Next Jump’s culture and foster a sense of long-termism. Mr McCoy claims that a greater sense of security has pushed up productivity and innovation. Staff have also become more open about their weaknesses. Though no employee has been fired in the past two years, Mr McCoy does admit that some left early on by mutual agreement.

Is such commitment to a worker worth it? Two years down the line, “no fire” is still in its infancy. What will the tricky teenage years bring?

Less time in the office may not improve life

● South Korea has some of the longest working hours in the developed world — 50 hours a week on average. This statistic worried the government so much that in 2004 it sought to reduce office hours. Has it helped? Not according to research published in the Journal of Happiness Studies, which found that workers did not become more satisfied with their job or indeed their life when a 10 per cent restriction on hours was imposed. Why? Perhaps because the reduction was too small to have any real effect. Or worse, because workers had to squeeze the same amount of work into a smaller number of hours.

Loosening the reins in a family business

● Sir Rocco Forte, chairman of Rocco Forte Hotels told The Sunday Times of the perils of mixing family with business: “[My father] was always extremely worried that I’d make a mistake so he never really gave me any authority, until I did have a lot of authority — when if you made mistakes, you made big ones. So, with my daughters, I’ve given them authority in the areas they control. They have the respect of the people in the company.”

workingsmarter@ft.com

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