As freelancing and the so called 'gig economy' grows, some young companies are actually making it more lucrative for employees to prove their loyalty and commitment.
Since its launch two years ago, Managed by Q has raised $25 million for its on-demand service which start-ups use to clean and maintain their offices. Instead of matching offices with available freelance cleaners, the employees are classified as employees, not independent contractors. The cleaners gets benefits like health insurance and a 401(k).
In March, the company announced it would give five-percent of equity to its workers, a move that U.S. Labor Secretary Tom Perez praised.
Dan Teran the co-founder of Managed by Q said the decision to give employees equity made sense both to his conscience and the bottom line.
"We know that taking care of our team not only makes them feel great about Managed by Q, it also makes them feel more invested in the company's success," he told CNBC. "It's a long-term investment and we've seen in other companies with a similar mindset, (Costco, Trader Joes and Starbucks, to name a few), make this translate to ROI."
Chobani, the yogurt company, recently announced something similar, saying it would give its 2,000 full-time employees an ownership stake in the company. Hamdi Ulukaya, its founder, said he'd giveaway up to 10% of the company when it goes public or is sold. The move, could make some employees millionaires.
Teran said much of his company's growth in both sales and employees comes from referrals.
"We are a rare case in that our cost to acquire new employees has actually declined considerably as we've scaled and leveraged referrals and partnerships with amazing nonprofits and government entities to place great people in great jobs," Teran said.