Zappos Pays Employees Based on the Liveliness of Their Shift

By: George Hancock Jr.  |  March 4, 2015

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Zappos is an online shoes and accessories retailer. Zappos is not a run-of-the-mill retailer, however. From a consumer’s point of view, it might appear to be normal. Maybe prices are a little high. You might receive your shoes really quickly, but you probably won’t assume your seller is being ruled by a set of extremely unorthodox policies. One of those policies is to allow employees at all levels to make decisions, even big decisions. Employees aren’t hired and planted into their positions, they regularly rotate and decide, as a group, what they will do. As a result of these policies and Zappos’ core values, which place a heavy emphasis on evolving and providing super effective service, the company has designed and is testing a “surge” wage model.

Open Market is the name of it. It’s similar to Uber’s model, which distributes higher wages to workers who are on the job at the busiest hours. At Zappos, Open Market has been tested in its call centers. If employees work at hours of high call volume, they are paid more. Therefore, their schedules are flexible but they earn less if they don’t work when it’s busy.

Zappos’ wages weren’t especially high before, around $14.50 per hour. That’s close to the national average. However, employees receive excellent benefits and awesome perks including on-site dry cleaning, a ping pong table, a video game room, a nap room, health-related services and plenty more. It’s amazing! The new wage model is expected to be so enjoyed that it will be another perk. It is intended to “test how we could give our call center employees more flexibility and be able to incentivize people to come to work when we needed them, even if the timing wasn’t always ideal,” says Adam Goldstein,  Zappos Labs’ senior products manager. Zappos Labs is the R&D arm of the company, which attributes a 20% increase in “self-reported happiness” to Open Market.

Retail mangers, take heed. Thinking flat out backwardly, in relation to conventional management practices, does work, at least in the case of Zappos. You can learn more about Zappos’ core values at its website.

Have you ever had a flextime (flexible hours) job? Did you like it? Let us know in the comments below.

 

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