In today’s episode of The Startup Chat, Steli and Hiten talk about making exceptions for employees.

There might come a time in your startup when a team member might ask you to make an exception for them either due to their performance or due to unforeseen circumstances. Deciding whether to give such exceptions to a team member can be tricky as you’ve got to consider how it will affect your workforce.

In today’s episode, Steli and Hiten talk about why you should always prioritize the group instead of a person, the mindset of an employer’s mind when they let go of a person, why exceptions are not the new normal and much more. 

Time Stamped Show Notes:

00:00 About today’s topic.

00:32 Why this topic was chosen.

04:33 Why you should always prioritize the group instead of the person.

05:08 The mindset of an employer’s when they let go of a person.

05:00 How companies can over-index on an individual’s needs versus the group.

05:35 How to approach a situation when a team member wants to be treated differently.

06:31 Questions to ask yourself before giving a team member special treatment.

06:39 Why exceptions are not the new normal.

08:44 The different way ways to make an exception for team members.

09:54 How to judge a team member’s performance.

3 Key Points:

  • When you let go of someone, there’s a lot of people who spend a lot of energy on the person being let go instead of the team that’s still there.
  • You’re over-indexing on the people leaving.
  • Ask yourself, if you’d do this for anyone else on the team if they were in the same situation.


Steli Efti: Hey, everybody. This is Steli Efti.


Hiten Shah: And this is Hiten Shah.


Steli Efti: And today on The Startup Chat we’re going to talk about making exceptions for employees. Is this a good idea, bad idea. How to approach this topic? Here’s why I want to talk about this with you, Hiten. So recently I was talking to a manager and she was describing to me kind of her team and team set up and some of the challenges that she has and she went through a list of like certain things that were challenging on one team member and challenging on another team member. Most stuff sounded kind of pretty normal. And then she talked about one of her direct reports who is this amazing human being. Great personality and person. Is bringing a lot of value to the plate but has this like very difficult life situation and all these things going on in her life and like it’s just very, very messy, very complicated stuff that leads this manager to make all kinds of exceptions for her. Right? There’s like, she might work less at times than her coworkers. She might get a whole weeks, where she does almost nothing. She might get special projects to work on versus the work that she was really hired for because she liked those special projects more and she needs something to support her emotional needs because she’s going through trauma in her life and other areas. And as we were talking about that, like I was very much reminded of the sales teams of the past. This is a very different example. If I could share the details, it will be very hard not to feel an insane amount of like empathy for that person that’s getting all these exceptions, but it reminded me very much of the sales teams of the past that will be built with these incredible assholes in them that would be crushing it when it came to their quota and just bringing in revenue and customers and just destroying it in terms of the amount of money that would bring in for the company, but just be terrible to their coworkers. Just crush morale, be terrible to new sales reps. Just be super toxic employees. Right. And I would always tell sales managers that they need to cut them loose. Like nobody is important enough, no matter how much value they bring in. For them to be basically, fucking up the entire culture of your whole team and for them to stop you from being able to scale and grow because all the new great people leave again because they don’t get the oxygen to grow because these people with all the exceptions you make for them are really ruining the foundation of your company and your team. And I talked to her about like how … I didn’t want to presume that that was the case. So I started asking questions. How are these exceptions affecting other people? How are these exceptions making you feel? And a whole massive bag opened up with all kinds of problems. And that made me go, you know what, this is not that uncommon and might be a really interesting topic, messy, interesting topic for the two of us to quickly unpack and explore for the founders and entrepreneurs that are listening to our podcast. That either have already been in a situation like this, are in a situation like this right now or if they are not, they will be at some point where you’re wondering if you should make exceptions for an employee. What’s reasonable, what’s not? When should you do them? When shouldn’t you do them? Let’s talk about that. I’m dying to hear your opinion on this.


Hiten Shah: Yeah. So to me it’s related to this one other thing that I find really interesting, which is when you let go of someone on the team. There’s a lot of people who spend a lot of energy on the person being let go instead of the team that’s still there.


Steli Efti: This is so good. Say it again.


Hiten Shah: Right? There’s a lot of energy being put on the person being let go and so the team that’s still there.


Steli Efti: Yes.


Hiten Shah: And my recommendation is make sure you think of both parties. In fact, I would overemphasize the group versus the individual. And that’s what doesn’t happen. Like I hear this so much. I’m like, “Oh, we want to take care of this person. They’re going, they’re leaving or we need to let them go. Like, yeah, sure.” But what about those like, double digit or more number of people who are still there and what’s in their heads and what’s going to happen to them? How are they going to think when we let go of this person? And that is not what most people think about when they’re letting go of somebody. They index on the negative essentially, right? Which is a person that’s leaving. En other cases, they’re like, “Oh, this person’s leaving. What’s everyone going to think?” Right. I’ve seen that too. When it’s like a really important person and they feel weird about it because this person wants to move on or whatever, but they’re a really good culture fit. This, that and other, and you’re not necessarily letting them go. And then there’s an over-indexing on that side sometimes. But really the common one when I see as you over index and the people leaving, so in this case it’s really tough because it’s likely that the companies that find themselves in this position to provide special treatment to a specific individual are over indexing on that individual and that individual’s need, versus their needs versus the group’s needs. And I think that there is a way to talk to someone if they’re requesting special treatment, to explain to them that like, look, “If we treat you in a certain way when someone else has a situation like you’re in, in your life or whatever, we’re going to have to treat them the same way.” And most of these kinds of treatment things are usually in smaller companies where there’s no policies. Right?


Steli Efti: Hmm.


Hiten Shah: So you start having to think through what’s our policy for this and not even policy. Would we do this for anybody on the team if they were in this situation. That’s the key. If the answer is yes, then go ahead and do it. If the answer is I don’t know or no, be careful what you do for that person. Find the answer where it’s yes, we would do this for anyone else on the team, if they were in the same situation. Then you can sit there and honestly speak with your team about it. So to me it has a lot to do with can you honestly speak with your team about it and say, “No matter what this aligns with our values or you know, this is so important to us that no matter who you are, if you find yourself in this similar situation, we’re going to treat you in a similar way that we’re treating this person cause that’s who we are. That’s how we do things here.” That’s what it boils down to for me. I don’t think people think about that. They think a lot about solving a problem with that person right now. Instead of worrying about what are we going to do next time? Are we treating people equally? If not, can we explain it to the team? Why we’re not treating this person the same way we would treat someone else if they were in the same situation? Because if not like you’re going to … There will be problems. I can almost guarantee you. So it’s really about can you explain this to the team? Will they understand, will they feel like they will be treated the same in a similar situation or not? And if not, like you really need to think hard about what you’re about to do or what you’re doing.


Steli Efti: I fucking love this. So this is so important. So valuable. I’ll just add one more thing to this, which is, exceptions by definition or an exception by definition is not a recurring thing. It’s not the new normal. It’s not an exception. If there’s a big-[crosstalk]


Hiten Shah: You’re right.


Steli Efti: If there’s a big life event, and, and we talked about this on this podcast and I’ve actually had just recently a conversation with somebody who applied for job at Lowe’s. That said, “Part of why I applied was this one episode on the Startup Chat where Hiten and you talked about somebody on your team that had a parent die and how you treated that person. Because that made me really feel like, wow, you know, whatever, this is a company, this is somebody I would want to work for.” When some big life event happens, there’s going to be exceptions. Once in a while you’re going to have to give somebody a break or support somebody in an unusual way, because they deserve it, right? And because life is messy sometimes, but there’s a difference between making an exception within reasonable boundaries and then going back to the normal. And there’s a difference between creating an exception that’s now the new normal. That’s not an exception anymore, right? You’ve now created this new type of work relationship and job position and job responsibilities that you would never hire people for with those kind of exceptions build in as new normal. So it’s one thing if this person had like some kind of life challenges that were like a one time thing for a week or two, you needed to cut them a break. That’s fine. I think that, that’s not that crazy, but this was much more of a … This is the new normal, this person is dealing with so many things for the last whatever year or so. They’re just doing their own rules, right? They just work sometimes. Sometimes they don’t and sometimes more, sometimes less. Sometimes we change what work we give this person that’s not an exception and it creates so many, so many problems. It creates a problem for you because you are now going to have to … You cannot really say if they’re doing well or not because their performance is up and down because you’re giving them all these new things and all these like … There’s these new rules. So how do you judge their performance if they only work for one week, that month. Do you just judge what they did in that week? Yeah, one of the things that that manager told me is like, “Yeah, you know what’s crazy is for a month this person only worked for a week, but that week they really crushed it for the company. Well, okay.” Right, but how do you judge that overall four week period? Like it makes it really impossible for you to manage. You’re going to have to spend so much more time and energy to now, babysit that employee and come up with new rules every time and work around their issues that’s going to drain you and take away all your energy. It’s creating issues for their coworkers because their coworkers will see this and ask themselves, “Well, why am I not getting these exceptions? Can I really a trust my team member? Why am I carrying more weight than this person?” Right? It’s going to create issues within the team. It’s going to create issues with new people, right? To hire a new employee. That employee will orient around the existing employees in terms of what excellence looks like. What is accepted and what is, what is behavior that is tolerated. And so they see this employee that comes and goes and does whatever the hell they want and they’re like, “This is totally cool. I can-


Hiten Shah: This is okay.


Steli Efti: This is okay here. Right? And it’s also bad for the employee you’re making exceptions for because that employee has now this idea that this is okay. The way I behave is okay, and the way this entire company or entire team works around my personal needs is fair. So now you’re creating a new expectation that’s totally wrong in their mind on how life should work and work should work, right? Which, is also not cool. It’s bad for everybody. It is bad for everybody. If you make exceptions, make sure it’s one time events that’s short lived and that are as reasonable as possible. And that are investing in people that have earned, to get an exception once in a while. But it’s like, in five years this happened once. Not every quarter this happens once or every month this happens once. It’s not and exception anymore. It’s a new rule, and it’s a rule that needs to then apply to everybody, and everybody you hire, everybody that’s in that team. For them, for you, and if you’re honest, in most of these cases, people would be like, “Hell no, this is the new rule. This can’t be the new rule. If this was the rule. The business would collapse. Well, if everybody did this, the business would collapse.” You cannot have one person do this because if one person does it, it’s going to affect other people. It’s going to be two at some point, four at some point, eight. It’s going to create issues. And it’s also not fair to allow one person to do something that you would like fire other people over. That won’t work. So make an exception for people is something that I think is part of life. But I think way too often we get tricked into a situation where we make these exceptions that become the new rule and then things start to unwind and to collapse. And we create all these problems and issues just to help one person or to make one person’s life easier. Now we’re creating all these unintended consequences. So be very, very wary of this because this is a very common mistake.


Hiten Shah: Yeah, I mean that’s what we got.


Steli Efti: That’s what we got. All right. If you’ve made any exception for anybody that you are now like freaked out about and you want to talk about it, you can always get in touch with us,, Just let us know and until next time we’ll hear you very soon.


Hiten Shah: Later.