Exactly my first thought. Here in Germany Amazon gets negative press for their employment conditions, too. How does that fit together? Differences between countries? Just biased press?
This would obviate amazon of paying unemployment & health insurance. So, at one level its a dollars and cents decision. So, if you have x% voluntary turnover and it cuts in half the number of people that they need to "let go" involuntarily, the ROI on the strategy is likely breakeven.
And it would seem that from a morale perspective, everyone is better off. The managers can probably still goove good word about the employees etc because the conflict is probably easied and both sides save face.
Makes sense to me. Could even potentially save money in the long run, since employees would be leaving at an anticipated time, instead of a random 2 weeks notice.
I think you're right that the timing will be important. For example, by providing employees an incentive to stay through the holiday season and leave before the seasonal lows that follow it.
Over time it should get rid of those that value money more than the specific job; that should avoid mass actions that would force the company to increase wages. The people who remain are those who're (or who've learnt to be) content with what they got.
http://blogs.hbr.org/2008/05/why-zappos-pays-new-employees/