Why do you pay your employees?

Few management blunders have attracted as much attention as the one committed by the CEO of mortgage lender Better.com.

If you missed it, Vishal Garg fired more than 900 of his team members on a Zoom call by simply saying, “If you’re on this call, you are part of the unlucky group that is being laid off. Your employment here is terminated effective immediately.” (At least he didn’t add, “Happy Freaking Holidays!”)

Mr. Garg displayed a stunning lack of self-awareness and respect for his team. However, apparently this is nothing new for him. According to The New York Times, Garg previously told his colleagues they were “stealing from the company by working (out of their home offices for) only two hours a day — which…was contradicted by his team’s recent promotions and raises.” In addition, the NYT article stated that Mr. Garg’s rantings “had made it challenging for them (former employees) to apply for new jobs.”

Everyone needs to be rewarded and respected for the organization to excel — not just those in the office every day. Look at what happened when Vishal Garg sent his company into chaos if you don’t believe me. (The company’s Board of Directors have brought on a third-party firm to assess its leadership and culture, according to a copy of a memo obtained by The New York Times.)

There’s a lot to unpack here. One question we could consider is: what is the quality of management of a company that believes they can terminate a significant percentage of its employees — yet presumes they can deliver an equal quality of customer experience going forward?

This point also begs a larger question: Why do you pay your employees?

· Are you paying them for the hours they work?

· Or are you paying them for the results they produce?

Too often, we get wrapped up in tracking time. We think that if someone is “only working two hours a day,” they must not be doing their job. But is that really fair or accurate?

Obviously, there are certain businesses and industries where hourly compensation is perhaps the only way to deliver remuneration. For example, employees…