They Paid a Third of Their Staff to Quit Over Politics at Work
Almost a third of the 60-person staff took the money, and the founders call it the best money they ever spent on culture.
David Senra · DHH: How to Build a Profitable Company Without Losing ControlDHH, co-founder of the software company 37signals, says he came close to retiring in 2021 from work he loved. He liked the business, the technology, and most of his coworkers. But a fight over politics at work that had built over a few years had made the job miserable, and walking away began to look easier than fixing it.
The first signs had appeared around 2018, in his account, when a small activist group inside the company began pressing political demands and deciding what was acceptable to say. He and Jason Fried, his fellow co-founder, first saw good intentions where he now says there were none, and let the effort roll. By 2021, they feared it could take over the whole company and leave them with a business they did not want to run.
This is the story of how they stopped it with a work rule and a buyout, which they later described as fixing the culture after a rough stretch. The rule barred political talk from work channels. The buyout offered up to six months of pay to anyone who disagreed.
They started with a hard stop: no more discussing politics in work channels, including in the same space where staff discussed features for Basecamp, their project management software. They said that mix was divisive in a professional setting, and put the decision in a memo saying it was over.
When protests followed, they added the buyout. Anyone who could not accept working under the rule could take up to six months of salary and leave. With tech hiring booming, leavers could collect the payout and start a new job quickly.
About 20 of 60 employees took the offer, about one in three people on staff. DHH said the departures removed more than the small core of critics, taking a wider circle with them, and left a culture he described as completely cured of the conflict. He called the payouts the best money they had spent on culture, though the company then went through a rough stretch with so few people left.
At that point, Tobi Lutke, the Shopify chief, connected DHH with venture capitalist Marc Andreessen, who had seen similar disputes at other software companies. Andreessen told them they were not alone, offered reassurance while they faced criticism on social media, and lined up contacts for programming and operations help that they ended up not needing.
With that backing, they decided not to grovel, not to apologize, and not to reverse the policy.
Questions people ask
Did 37signals survive losing so many people at once?
Yes. 37signals continued as an independent software company selling Basecamp and Hey, its email service. After the departures, it hired again and has remained small, profitable, and remote.
Can a company legally ban politics at work?
In the United States, a private company can generally keep internal work channels focused on business and ask employees to take political debate elsewhere. Problems arise mainly when a rule is enforced unevenly, so employers are advised to apply it consistently and put it in writing.