Netflix founder Reed Hastings on how to fire someone

March 01, 2024

Netflix is famous for its “keeper test”: If a team member was leaving for a similar role at another company, would the manager fight to keep them?

If the manager wouldn’t fight to keep them, the employee is given a generous severance package so the company can find someone even better for that position.

In the clip below, Reed is asked to demonstrate for the audience how to fire someone.

The whole video is worth watching, but the key takeaway is that Reed tries to treat the company like a professional sports team: “it really sucks to get cut from the team, but it’s not an ethical judgment or a moral judgment or a judgment of you as a person.”

He continues:

“What we’re trying to do is get away from ‘you suck.’.. and I’m being honest as opposed to being hurtful… The more it is socialized with all of you as if it was in sports—where it’s not as much a life kind of thing, it’s a performance kind of thing—the better.”