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Why most of Three Square Market's employees jumped at the chance to wear a microchip

  • 50 of the 80 employees at Three Square Market, a provider of self-service breakroom vending machines, voluntarily agreed to be "chipped."
  • "It really doesn't hurt at all," CEO Todd Westby told CNBC.
  • A future version of the microchip could include GPS, and if an employee leaves the company, it won't be removed.

A Wisconsin company is offering its workers the chance to toss their employee ID card and chuck all their passwords. If that sounds appealing—especially for people who frequently lose or forget those staples of modern-day office life—it comes with a catch.

In exchange, each employee will insert a tiny microchip: Under their skin.

As it happens, 50 of the 80 employees at Three Square Market, a provider of self-service breakroom vending machines, voluntarily agreed to be "chipped." Those employees appeared to brush aside many of the concerns shaping this debate since it began.

"It is really convenient having the chip in your hand with all the things it can do," Three Square Market CEO Todd Westby told CNBC's "On the Money" in an interview recently.

"If you're a technology company, things like this are actually exciting," Westby said. "We don't look at it as being too weird. We initially decided to do it just because we thought it was…I guess you could say 'cool, something different'."

On August 1st, the River Falls, WI company held a "chip party," where many employees let the company insert a $300 microchip, the size of a grain of rice, into their hand between the thumb and forefinger.

"As far as it hurting," Westby said, describing the implantation process, "it feels like basically somebody stepping on a pinky toe with a dress shoe on. It really doesn't hurt at all."

Many workers, he said, decided to have the device implanted "because they were informed and told exactly what it can do and can't do, and what it does do and doesn't do."

At the Three Square Market workplace, the device allows door access to enter the building, sign into their computer, and pay for snacks — all with a wave of their hand on a sensor. The microchip replaces passwords, ID badges and even credit cards.

"They made the decision for themselves," Westby told CNBC. "The people that did decide to do it really were looking forward to convenience that it does bring to the everyday life."

But not all employees agreed. Marketing executive Katie Langer was among the holdouts refusing to implant the device.

"I still haven't seen a lot of research on long term health effects. It kind of freaks me out a little bit. It's still a foreign object going in your body," Langer told NBC News in an interview.

A GPS for children?

In 2004, the FDA approved the implantable RFID chip Three Market is using. RFID stands for "Radio Frequency Identification" which uses electronic tags placed on objects, people, or animals to relay identifying information.

Despite the government's backing, the chip remains a polarizing subject, and the source of conspiracy theory and speculation.

Westby says this "particular chip" does not have GPS on it, but he said that could change. "We are developing a chip that will be able to use as a GPS device."

The company says future uses of the microchip implant could include holding your passport and travel information, medical history, and GPS to safeguard children.

"You would not believe since this chip came out all of the interest there is in the GPS chip for children and so forth," the executive said.

Yet what happens if the worker leaves the company? Who owns the microchip?

"It was never designed to be our property," Westby told CNBC.

"We decided to put it in employees as a form of convenience for them. When employees leave, we actually consider it an employee retention tool," he said. "We do not plan on taking it out. You know, it's up to the employees."

On the Money airs on CNBC Saturday at 5:30 am ET, or check listings for air times in local markets.