How to reduce employee turnover
Employees leave an organisation for different reasons.
They could be:
- Being dismissed
It is an accepted way of life for businesses that people come and go, but if you are experiencing a high employee turnover, you need to assess the reasons for their departure and take steps to minimise the disruption to your organisation.
What are the costs of a high employee turnover?
- Finding a replacement can involve a long and expensive process of advertising the role, sifting through applications and going through rounds of interviews and selection tests.
- While you are finding the replacement, you may end up having to shell out on overtime for current employees or hiring a temporary worker.
- The new worker may need some training to get up to speed with the job’s responsibilities and how your organisation works, which takes time and money.
- It can have a negative impact on other colleagues, who see a conveyer belt of old faces going and new faces coming in. If they have to deal with extra work because someone has left or to train the person who has just come in, this can affect their productivity and motivation.
- If the employee who is leaving feels that they have been treated in an unfair way, they may raise grievances or submit claims in an Employment Tribunal. This could be something only a HR expert could cope with.
- They may also say unflattering things about your organisation to their friends and online.
The UK's highest court, The Supreme Court, has ruled that Employment Tribunal fees are unlawful. This means the financial barrier to putting in a claim has been removed.
Why are people leaving?
Reasons could include they:
- Want a new challenge
- Are not enjoying the job itself
- Don’t feel like they have good career prospects within the company
- Want to leave for family, personal or care reasons
- Are experiencing issues with a manager or colleagues
- Don’t feel their work is valued
- Feel underpaid
- Don’t agree or feel comfortable with recent or upcoming changes in the organisation
- Feel stressed at work.
In reality, it is probably not just one reason, but a combination of factors.
How can I find out why people are leaving?
An exit interview is a good opportunity to understand why someone is leaving. While some people may be reluctant to spill the beans on the real reason for fear that there will be some type of retaliation, others may be only too happy to harp on as they feel angry or emotional about their situation.
Other ways to find out how people are feeling is through individual appraisals, group meetings, employee surveys or intranet discussions. These can all help you establish if there are things within your organisation that are causing people dissatisfaction. If you are not comfortable doing these, a HR consultant can run these independently and advise on the results.
In any case, you should monitor the employee turnover rate and keep accurate records to see if you can identify specific trends or patterns. Once you know what is going wrong, you can take action
What can you do to manage a high employee turnover?
There is no crystal ball to see how well someone will fit into your organisation, but it is important to ensure that your recruitment and selection processes are fit for purpose and that you are looking to recruit with a view to retain, not just meet short-term needs.
Ask yourself, are you accurately representing the job to the applicant? Are you managing their expectations? Can you deliver on what you have promised?
It is essential to get staff settled in quickly by giving them a comprehensive induction. The induction should provide a good overview of the role, team, managers and business goals, and answer any questions they have.
You can read our top tips for inductions here.
You should have frequent meetings with employees to see whether they are coping with their workload, have any workplace issues, what personal goals can be set and if there are any training or development opportunities.
If they are doing good work, give them praise. If they are not doing good work, address the issue. On completion of work, give them feedback. All of these things help them feel motivated and help retention.
You will also need to look at your management style and your organisation’s culture.
Are grievances being taken seriously? Are disciplinary issues resolved? Do employees feel supported if problems arise? Is there good camaraderie between teams? Is there conduct that is tolerated which shouldn’t be? Are steps being taken to reduce stress? Is there a good work-life balance? Are you as an organisation open to flexible working? Do you consult and communicate with employees about change?
It is useful to have contingency plans so if someone does leave, you are not left in the lurch.
Investing in training can help employees feel more equipped to do their job and more motivated to take on new challenges.
Make sure the costs are reasonable and the training suits your needs.
Pay and Benefits
Pay structures need to be reviewed to see if they are in line with the industry and your competitors. You should also think about employee benefits and incentives. Are they what employees want? Are they fit for purpose? Are the terms and conditions making people unhappy?
Are people being promoted from within? Are you giving people the tools, resources and opportunities to progress? Do employees understand their career pathways?
By tackling the issues, you can lower your employee turnover rate and all the costs involved and ensure a productive and efficient workforce.
For more information on HR and Employment Law challenges, give your Employment Law Adviser a call to get tailored support.