A DAY & ZIMMERMANN COMPANY

Netflix: Ushering in the freelance economy or chaos?

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Posted by Matt Rivera

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September 20, 2010

You might have heard recently about Netflix's vacation policy, which allows employees (exempt, salaried employees) to take as much vacation as they like. They don't keep track, and the rules are simple: just make sure you get your work done and that your work is covered while you are gone.

I think the reason we are hearing about it again is that people are pretty unhappy at work. They are looking at the greener pastures at other companies, and right now, unlimited vacation sounds pretty good.

In reality, the policy has been in place for years, along with other freedoms and open or non-existent policies. And a very small percentage of other companies have the same type of policies.

While this might or might not be a larger trend, it does speak to the desire for some people to work on more of a freelance basis. Benefits like unlimited vacation, while surely beneficial to the company (since they don't have to keep that vacation time on the books), gives the employee more freedom to work as he or she likes.

This type of policy also lowers the barriers between someone who wants the flexibility of working freelance with the stability of a traditional employment engagement. In short, it allows Netflix to recruit from the freelance pool as well as from those on the edge who are thinking about freelance, and those disillusioned by no annual raise and no bonus last year.

It reminds me of the dot com era, in which many people worked for little actual salary and a ton of stock and stock options. (By the way, at Netflix, employees can choose their own mix of cash or stock as compensation.) It's also a good indication that companies like Netflix are stepping up efforts to attract employees in this tough economy.

However, the other side of this coin is that some reports from inside Netflix suggest that the culture might be suffering. It might offer "responsibility and flexibility," but the trade-offs are very high expectations for performance and a lack of clear guidelines and set policies.

Having a high performance culture is great, but the lack of policies to help set and manage expectations is destined for problems. One of the strongest emotions I see in the office environment is a sense of fairness. Without set policies, there can be no true measure of fairness, which leaves only the perception of fairness, which equals DANGER.

I'm in the midst of an office move as I write this. When the floor plan started to become public, there were several instances of, "Why does he get an office?"

My response was that it is strictly based on your employee class (which is our pay grade scale). It was a quick answer with no discussion.

How would that discussion go at a company that doesn't have a set office policy? I imagine it would be something like, "Well, he has an office because his desk fits, he has a fear of cubes, and he's got better hair than most of the people in the office.

While I sometimes don't like or agree with all of our policies, I can only imagine what it would be like if we didn't have some of them. Probably chaos.

So while I think it sounds cool, I'm not sure an unlimited vacation policy will work for everyone, or even Netflix, in the long run. Besides, let's get real. What good is unlimited vacation if you can't put down your Blackberry the whole time?

The bigger question is: Do they get free unlimited movie rentals? Sign me up for that.

























Topics: Staff Management, HR Strategies

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