- At least 18 Basecamp employees have resigned after the company made sweeping policy changes.
- It barred politics, cut benefits and ended committees, which sends a negative signal, experts say.
- Basecamp’s move reflects the cofounders’ resistance to dissent, an employee told Insider.
- See more stories on Insider’s business page.
The tech industry is well known for its abundant perks — laundry service, fitness rooms, and an abundance of snacks — geared toward supporting employees’ full lives, even outside of work.
Basecamp’s recent policy changes, including a ban on political discussions and the end of wellness and education allowances, go against the grain. The aftermath of Basecamp’s announcement bears that out: Roughly a third of the company’s 58 employees have decided to leave after the cofounders offered severance packages to those who disagreed with the changes, a source told Insider. At least 18 of them have announced their departure on Twitter.
The company is striving to separate work from personal life, in part to avoid a clash of dissenting opinions, according to writings from Basecamp’s cofounders and statements from employees, including one who spoke with Insider. But it’s a move that’s risky, experts told Insider, as employees grow accustomed to having a bigger say in the culture of their workplaces.
On Monday, Basecamp cofounder and CEO Jason Fried announced that the productivity software company was making a series of sweeping changes to its workplace policies. In addition to banning “societal and political discussions” at work and ending “paternalistic benefits” like wellness perks, the company disbanded its workplace committees and ended 360 reviews, in which employees receive evaluations from peers and subordinates in addition to their bosses. The changes unleashed a torrent of criticism on social media, including from Basecamp employees.
Though the decision to bar political talk closely resembled Coinbase’s ban on discussing social issues, the end of wellness benefits has less of a precedent. Most tech companies are adding such benefits, said Christina Sullivan, principal and vice president at Sequoia Consulting Group, which advises companies on benefits packages. Attention to employees’ emotional well-being has especially ramped up in the past year as the pandemic upended people’s work and personal lives, she told Insider.
Yet the move is in line with the desire of Basecamp’s cofounders, Fried and David Heinemeier Hansson, to separate other aspects of employees’ lives from the company’s day-to-day work. “We’re in the business of making software, and a few tangential things that touch that edge,” Fried wrote in his blog post announcing the company’s new policies. “We’re responsible for ourselves. That’s more than enough for us.”
‘Bullying behavior’ and low tolerance for dissent
As with benefits, Fried cited a desire to focus on work as the impetus behind banning political discussions. But that particular change also reflects a founder-driven culture in which others’ opinions are not always welcomed, according to current and former Basecamp employees. “There’s always been this kind of unwritten rule at Basecamp that the company basically exists for David and Jason’s enjoyment,” one told Platformer’s Casey Newton.
One former employee who spoke with Insider pointed to several instances of witnessing “bullying behavior” from Basecamp’s cofounders. The company’s short-lived diversity, equity, and inclusion council got started, the former employee said, after a conversation in December about fear among employees, especially those of color, that they might lose their jobs if they publicly disagreed with the cofounders, particularly Hansson.
“There’s a history of David’s behavior toward employees when he disagrees with them,” the former employee said.
Basecamp did not respond to a request for comment from Insider.
Fried has said that Basecamp’s DEI efforts will continue despite the disbanding of the council, and he has written about the importance of diversity in the past. But ending collaboration with employees sends a negative signal even if the company intends to continue such work, according to Mimi Fox Melton, CEO of Code2040, a nonprofit organization focused on racial equity in the tech industry that works with companies such as Dropbox and Intuit.
Inclusion by its nature requires soliciting an array of opinions, Fox Melton told Insider, and leaders have to be prepared for discomfort and conflict. Appealing to the authority of a single manager, by contrast, signals to others that their input isn’t valued, she said.
A changing definition of happiness at work
While companies can — and should — create etiquette guidelines around addressing thorny topics, barring discussion outright only serves to bury those issues, said Ian Schafer, CEO of Kindred, a network of executives from companies such as Facebook and Twitter that is focused on social responsibility.
Schafer told Insider companies have to get comfortable addressing social issues, just as they had to adapt to the internet economy. Those that struggle with the shift will have a harder time attracting talent, he said.
“What it means to be happy at work has changed over the past few years,” he said.
Basecamp’s new policies, and others like them, are a clear signal to would-be employees that such companies are not welcoming places to work, Fox Melton told Insider.
“I actually think that it’s a really good sign that the work that’s being done around racial equity in the tech industry is shifting conditions,” she said. “It is forcing leaders to say whether or not they’re truly willing to do the work it takes to lead diverse companies.”
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