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Recently, major corporations have radically rethought how they do business by establishing livable wages, developing creative equity plans, offering paid parental leave policies, and even pulling out of an entire state in protest of discrimination. In addition
to sending a strong signal that people come first, these organizations are also making
an economic argument to investors that employee-friendly policies pay dividends in reduced turnover and improved business outcome.
But what about small companies, and what about startups? The playbook aims to answer just that.
Foreword In April 2015, Luminary
Labs convened a broad cross-section of founders, thinkers, and doers for a lively discussion on how employee-favorable policies are shaping 21st century business models. Recently, major corporations have radically rethought how they do business by estab- lishing livable wages, developing creative equity plans, offering paid parental leave policies, and even pulling out of an entire state in protest of discrimination. In addition to sending a strong signal that people come first, these organizations are also making an economic argument to investors that employee-friendly policies pay dividends in reduced turnover and improved business outcome. But what about small companies, and what about startups? Over the course of the evening, we discussed the forces behind this sea change, generated examples of new and creative business imper- atives, and together, started writing a guide for the more human company. Following the event, we curated examples from a diverse set of growth companies to form this play- book. While no single policy or company is perfect, it is our hope that this compila- tion will provide practical examples for the startup community. We see this playbook as a living document, and look forward to hearing how your com pany is meeting this 21st century mandate. Sara Holoubek CEO & Founder Luminary Labs
Table of Contents Compensation 4
Plated: Equity for All..............................5 Offerpop: Have a Stake in Success..........6 Pinterest: Have Options for Your Options....7 Ampush: Savings that Grow....................8 Health and Wellbeing 9 General Assembly: We Have You Covered...10 Squarespace: Keep It Simple................. 11 The Muse: Taking the Pulse................... 12 Luminary Labs: Sick Means Sick............. 13 Etsy: Be Happy................................... 14 Allowing for Life 15 Upworthy: The Value of Downtime......... 16 Traackr: Stay Flexible........................... 17 Chartbeat: It Takes a Village................. 18 Change.org: Leave When You Need It.... 19 Career Trajectory 20 DigitalOcean: Funding Learning............. 21 360i: Doubling Down on Reviews..........22 Next Jump: Choose your Leaders........... 23 Birchbox: Happy Tribatical....................24 SocialCode: Learn the Code.................25 Managed by Q: Everyone Cleans......... 26 Bibliography 27 Thank you 29
4 of 29 For the
companies in this section, compensation is more than a paycheck. Plated and Offerpop have made it possible for every employee to have a stake in their success through access to equity. Pinterest has shown that progressive equity plans make it easier for team members to share in the rewards of growth. Ampush has found that supporting financial goals through 401k savings plans is both feasible and valued by employees. Compensation
5 of 29 “Every employee
is an integral part of the Plated Team… we believe our non-exempt, hourly fulfillment center team members are our most important resource, as they are the closest to our customer…they are the backbone of our company.” platedEquity for All THE COMPANY 400 employees, founded in 2012 THE POLICY Plated offers full-time, non-exempt, hourly employees in their fulfillment centers the opportunity to participate in an Equity Stock Options program, at no cost to them, subject to a minimum eligibility period. HOW THEY DO IT Plated administers this plan themselves, rather than using outsourcing services. They believe it’s important to provide a tailored approach to educating all employees on how the Equity Stock Option Plan is structured and managed, and its potential value.
6 of 29 “‘When Offerpop
succeeds, we all succeed’ isn’t a just a catchy saying. Each of us has a real stake in the company.” OfferpopHave a Stake in Success THE COMPANY 135 employees, founded in 2005 THE POLICY Offerpop provides options to every employee as part of their initial offer. Options vest over 4 years, with 1-year cliff vesting and then monthly vesting afterwards. The 4-year schedule rewards employees who stick with the com- pany for the long haul, in addition to grants based on tenure or performance. HOW THEY DO IT Offerpop uses Anvil to automate their stock option administration process. They offer sessions for new hires explaining what an option is, with a focus on making employees comfortable asking options-related questions.
7 of 29 “We’ve just
made it much easier for team members to leave in one of the most competitive recruiting environments of all time. But that’s a trade-off we got comfortable with.” PinterestHave Options for Your Options THE COMPANY 700 employees, founded in 2010 THE POLICY People who have worked at Pinterest for at least 2 years and decide to leave for any reason are given 7 years to exercise their options instead of the usual 90 days. HOW THEY DO IT Pinterest started by gaining alignment on their philosophy around retention and equity. They offer some questions other companies should ask themselves: Do you believe that equity is part of annual compensation and that your team should have access to it early? Or do you believe that it’s intended to be a reward only if and when the company goes public or gets acquired? This philosophy will drive the decision.
8 of 29 “Ampush cares
about the wellbeing of our employees, and we want to provide helpful tools for them to reach their long-term goals. Providing a 401k plan is a huge benefit in itself, and adding a matching component is icing on the cake.” AmpushSavings that Grow THE COMPANY 150 employees, founded in 2009 THE POLICY Ampush offers both traditional and Roth 401k options for full-time employees, and Ampush matches $0.50 per $1.00 up to 4% of the employee’s base annual salary with an auto- increase of the deferral percentage by 1% each year (100% vested). HOW THEY DO IT Their plan began in 2014 with balance of $0, and they grew it by implementing auto- enrollment and providing an employer match structured so that employees would be incen- tivised to contribute more. They’ve also part- nered with advisors to offer informational sessions and webinars, and distributed help- ful resources from their 401k partners.
9 of 29 Health &
Wellbeing The companies in this section believe that healthy companies need healthy employees — meaning they shouldn’t have to worry about paying for a doctor’s visit or losing pay when they’re ill. General Assembly, Squarespace, and The Muse prioritize insurance coverage. At Luminary Labs sick means sick, and Etsy uses employee happiness as a measurement for overall health.
10 of 29 “Ping pong
tables and beer kegs can be fun, but we’ve found candidates and employees most appreciate practical considerations like affordable monthly health benefits costs, eliminating their monthly phone bill, and the ability to take our classes for free.” General AssemblyWe Have You Covered THE COMPANY 400 employees, founded in 2011 THE POLICY General Assembly covers 90% of health insurance premium costs for every one of its U.S. employees. HOW THEY DO IT GA was an early adopter of Sherpaa, the healthcare concierge service that provides employees with a dashboard to access physi- cians, insurance information, and more. This has helped the company provide better rates (and reduced employee contributions), and also means GA employees have in-a-moment access to medical advice and resources.
11 of 29 “One of
the company’s core values is to simplify, and this extends to our health insurance policy. By ensuring all employees remain healthy and happy, we’re enabling them to be productive in the workplace.” SquarespaceKeep It Simple THE COMPANY 508 employees, founded in 2004 THE POLICY Squarespace covers 100% of the premium for employees and their dependents, begin- ning the first of the month following their hire date. They cover both in- and out-of-network expenses, and provide global medical insur- ance to all employees for personal travel. HOW THEY DO IT Squarespace recommends finding a health insurance program that is easy to setup and maintain. They strive to offer a fantastic policy to all employees, while keeping the sign-up process as streamlined as possible. They prioritize administrative efficiencies to ensure the program is sustainable and can scale with the company’s growth.
12 of 29 “It’s important
for us as a company that our team is healthy and has good coverage; we certainly don’t want them opting out of insurance because it’s expensive.” The MuseTaking the Pulse THE COMPANY 51 employees, founded in 2011 THE POLICY The Muse covers 100% of medical insurance and 80% of dental insurance for its employees. HOW THEY DO IT The Muse decided to focus on health insurance after surveying its employees to understand which benefits, social activities, and ideas they care about most. It’s important to manage ment that the team has a voice in decisions that impact them, and every time they’re asked, they give great feedback that allows The Muse to keep improving.
13 of 29 “We’re constantly
surprised by how many new employees come from environments where sick means ‘power through it.’ We encourage them to take the time they need to recuperate, so we can all stay healthy.” Luminary Labssick means sick THE COMPANY 14 employees, founded in 2009 THE POLICY Luminary Labs provides employees with 8 paid sick days a year, and strictly enforces a “stay home, get better” rule when team members feel under the weather. At the first sign of illness, sniffling employees are often sent home to rest and recuperate. HOW THEY DO IT Luminary Labs puts recuperation first, and knows that it’s important for employees to recover quickly so they can bring their A-game to work and life. Keeping these values at the forefront, other team members work nimbly to pick up the slack and prioritize pending deliverables.
14 of 29 “What’s missing
from so many employee surveys is the personal element. Instead of retrofitting a standard measurement system, we began by figuring out what we value most as a company and worked backwards towards how we measure those values.” EtsyBe Happy THE COMPANY 757 employees, founded in 2005 THE POLICY Inspired by the country of Bhutan, Etsy pub- lishes an annual Happiness Report based on an employee survey which over 90% of employees typically respond to. Etsy then anonymizes responses and makes them avai lable to the entire company, in addition to releasing a summary report to the public. HOW THEY DO IT Etsy partnered with University of Pennsylvania’s Positive Psychology Center to use the PERMA framework, a model to study happiness with core elements of psychological well-being. The survey evaluates employee sentiment about life outside of work, their colleagues, and Etsy as a company.
15 of 29 The following
employers support fulfilling careers by empowering the non-work activities that enrich their employees’ lives. Importance is placed on working to live, not the other way around. They believe that parents, regardless of gender, should spend time with the recent additions to their families. Upworthy incentivizes vacation and Traackr maintains flexible remote work environments, while Chartbeat and Change.org make sure parents get the time they need with their children. allowing for life
16 of 29 “We strongly
believe that taking time away from work is important for our staff’s well-being as well as their work.” UpworthyThe Value of Downtime THE COMPANY 80 employees, founded in 2012 THE POLICY After 3 months of full-time employment, Upworthy provides an employee with a yearly $1,000 vacation stipend to reimburse staff members for vacation-related expenses. Staff members can use the full amount at once or can submit partial requests for expenses for different trips. HOW THEY DO IT Everyone at Upworthy has unlimited time off — the company enforces a minimum, not a maximum. And to make sure folks are actually recharging, they offer the vacation bonus and require that the time be used for taking a actual “phone-off, not-checking-in” vacations.
17 of 29 “Chartbeat genuinely
believes in creating an inclusive workplace, and that means building a company with policies that cater to every one from our interns to seasoned employees.” ChartbeatIt Takes a Village THE COMPANY 98 employees, founded in 2009 THE POLICY Chartbeat provides primary caregivers with 12 weeks of paid maternal or paternal leave, plus 4 weeks of transitional flex time at 100% salary. Secondary caregivers are eligible for 6 weeks paid leave at 100% salary. HOW THEY DO IT Chartbeat suggests other small companies survey teams to ask them to prioritize benefits and perks. Employee opinions matter and it’s up to leadership teams to craft a policy, like maternal and paternal leave, that makes sense for their company culture.
18 of 29 “Generous, paid
parental leave eliminates the financial hardship of unpaid leave and ensures that all families are able to spend important time with new children. The result is that employees are less stressed, more engaged, and more productive when they come back to work.” Change.orgLeave When You Need It THE COMPANY 300 employees, founded in 2007 THE POLICY Change.org provides 18 weeks of fully paid parental leave for every new parent globally — regardless of gender, or whether the child is biological or adopted. Leave can be taken non-consecutively, within one year of the child’s arrival. HOW THEY DO IT Change.org conducted a robust cost-benefit analysis. They believe building the right cul- ture of support, and attracting and retaining top talent, far exceeds the policy’s cost.
19 of 29 “Our vacation
and remote work policies reflect that although we work hard and are committed to our jobs, we recognize everyone has lives outside of work.” TraackrStay Flexible THE COMPANY 30 employees, founded in 2009 THE POLICY Traackr blends an unlimited vacation policy with a remote workforce to give employees maximum work/life flexibility. With a team spread over the U.S. and Canada, employ- ees work with their managers to customize daily work schedules and enable extended trips abroad. HOW THEY DO IT As a company without a full-time HR depart- ment, implementation was very organic and based on employee needs. Internally they use communications solutions like Slack and weekly all-hands meetings that promote trans parency and cross-departmental collaboration, so remote employees are just as dialed in as those on site.
20 of 29 The companies
in this section believe that an investment in their employees’ growth leads to better retention, leadership, and results. Digital Ocean promotes learning through books and conference attendance, while 360i and Next Jump focus on fostering leaders through man- ager and peer reviews. Meanwhile, Birchbox celebrates career longevity with “stay interviews,” and SocialCode steeps newbies in the company’s learning culture. At Managed by Q, senior leaders mop floors to understand what it takes for their team of cleaners to thrive. career trajectory
21 of 29 “Because our
mission is to create an amaz ing experience for developers, we want to create an amazing experience for our employees too.” DigitalOceanFunding Learning THE COMPANY 170 employees, founded in 2012 THE POLICY DigitalOcean gives each employee a Kindle loaded with books that have influenced the founders, and also funds attendance to at least one conference per year related to an employee’s career growth or personal devel- opment. All managers attend a 6-week inter- active learning bootcamp on managerial skills. HOW THEY DO IT DigitalOcean believes that as part of a rapidly growing company, every employee deserves the opportunity to grow and develop with them. They have discovered that developing and supporting team member growth drives the innovation the company needs to build the best and simplest cloud infrastructure experience.
22 of 29 “Our guiding
principle is simple. We believe that alignment on three things is the most important: What do our employees want? What does our company need? What do our clients need?” 360iDoubling Down on Reviews THE COMPANY 800 employees, founded in 2004 THE POLICY Rather than annual performance reviews, 360i has twice-a-year reviews focused on person- alized development in order to create career ownership. 360i also ensures cross-functional knowledge sharing at a capabilities day where teams teach one another about agency offerings and highlight the best work in every practice area. why THEY DO IT Instead of top-down management, 360i uses a “team of teams” approach. Aligning on goals on the individual and team levels provides the accountability and business context for the agency to thrive.
23 of 29 “Our mantra
is ‘Better Me + Better You = Better Us.’ We believe that in order to make the world a better place, we each need to focus on bettering ourselves physically, emotionally, mentally, and spiritually.” Next JumpChoose your Leaders THE COMPANY 200 employees, founded in 1994 THE POLICY At Next Jump, the leadership team is an ann ually peer-voted group of 21 individuals named MV21. The team reflects and rewards the employee growth process; 70% of the group are “home grown” leaders who started in entry-level positions and developed into company leaders. HOW THEY DO IT Each year, the entire company votes on 21 individuals they want to see as leaders. The staff considers who takes ownership, deter- mining which team members are role models in their focus on personal development and deliberate growth, in giving back by coaching other Next Jumpers, and in showing empathy for clients and users.
24 of 29 “We want
to remind long-term employees how much we truly value them and their contributions to the company and support them in thinking about what’s next.” BirchboxHappy Tribatical THE COMPANY 400 employees, founded in 2010 THE POLICY On their third anniversary, Birchbox employ- ees receive an increase in equity, 3 consecu- tive weeks of vacation with a travel stipend, an invitation to dinner with the CEO, and a “3 Years & Beyond Stay Interview” with their manager. HOW THEY DO IT Birchbox uses the performance management tool Namely to implement the Stay Interview. They’ve developed questions by searching through Stay Interview literature and adapting practices to match Birchbox’s culture and val- ues. Development Opportunity is one of their top-rated engagement factors, and Birchbox actively cultivates a continued culture of learn- ing and growth through its various programs.
25 of 29 “This program
gives employees the landscape to understand the impact they can and will have at the larger company and team level. Its larger reason for being is that we are a learning culture and this program is all about offering an open book to understanding SocialCode.” SocialCodeLearn the Code THE COMPANY 196 employees, founded in 2010 THE POLICY Every 8 weeks, SocialCode requires all new employees to attend a 3-day training that delves into the ins and outs of the company and industry. Each cohort graduates from the program with an understanding of how they fit into the big picture. The session culminates in a “forget the code” happy hour with the local office so new employees get to know their hosting office as well. HOW THEY DO IT The program is led by SocialCode’s training team. Their advice: don’t aim to make your grassroots training program perfect, get it started and iterate. Employees are hungry and engaged, so feed them with your mission, vision and know-how.
26 of 29 “It is
critically important that everyone in the organization understand what goes into making our clients happy to keep us aligned as an organization and empathetic to the needs of our colleagues who work in the field.” Managed by QEveryone Cleans THE COMPANY 400 employees, founded in 2013 THE POLICY At Managed by Q, everybody cleans. Whether joining as a software engineer or an office cleaner, the first week on the job begins with learning how to clean an office late into the night. This policy ensures that the entire com pany, regardless of position, stays aligned and acutely aware of the hard work required of their field operators for Q to succeed. HOW THEY DO IT Management has embraced this policy as central to the company culture. They also put a big focus on promoting from within: all of Managed by Q’s supervisors have been promoted from entry-level roles, and it’s not unusual for cleaners to move up the ranks.
Bibliography Benefits Design “How Google
weighs all of its crazy- awesome perks,” Business Insider. Jillian D’Onfro, 04/07/15 Allowing for Life “The Return of the nine-to-five,” The Economist, 11/10/14 “Silicon Valley: Perks for some employees, struggles for parents,” New York Times, Claire Cain Miller, 04/04/15 “An unusual new policy for working mothers,” Washington Post, Jena McGregor, 03/06/15 “Work Hard, Live Well,” Medium, Dustin Moskovitz, Dustin Moskovitz, 08/20/15 “A Toxic Work World,” New York Times, Anne-Marie Slaughter, 09/18/15 “How our Small Startup Affords to Offer Paid Maternity Leave,” Mary Ellen Slater, 03/18/15 “Beyond doing half the Parenting,” Anil Dash, 09/28/15 “The Great Divide in Workplace Benefits,” New York Times, 09/23/15 “Getting Creative About Benefits for Parents with Midweek ‘Playdates,’” David Zax, 10/02/15 27 of 29
Bibliography(cont’d) Diversity “Managing unconscious bias.”
Facebook Managing Bias. “Silicon Valley leaders, new to social issues, come together over Indiana law,” New York Times, Nick Wingfield, 03/31/15 Career Trajectory “Why Top Fund Managers Want Better HR,” WSJ, Lauren Weber, 09/08/15 “Digital Taylorism,” The Economist, 09/12/15 Compensation “Pinterest removes golden handcuffs,” Business Insider, Jillian D’Onfro, 04/02/15 “Starbucks to revise policies for its 130,000 baristas,” New York Times, Jodi Kantor, 08/14/14 “Behind the hype over Aetna’s minimum wage boost,” Fortune, Barbara Dyer, 01/20/15 “Corporate America strikes a liberal note on wages,” Politico, Brian Mahoney, 04/02/15 28 of 29
thank you partners We’d like
to thank the individuals and com- panies who made The Human Company Playbook, v1.0 possible, as well as our partners NY Tech Meetup and The Muse. photo and design Thank you to the artists below, who provided the images for the book under the Creative Commons License on Flickr: Loren Kerns, flickr.com/photos/lorenkerns Jonathan Rieke, flickr.com/photos/jonathanrieke highlights6, flickr.com/photos/highlights6 Design by Dorothea Lee, farthermore.com 29 of 29 Interested in contributing to v2.0? Write us: firstname.lastname@example.org | #humanco