Employee turnover is a critical factor for organizations as it is concerned with one or more employees leaving the organization as a result of resignation, termination or discharge etc. Employee retention is a major challenge for all HR professionals. When the employee turnover ratio is less, the employee(s) leave the organization for some reason and whose replacement needs to be found so as to not affect the business in any means. This involves not only the loss of skilled resources, but also knocks increased cost on hiring, recruitment, training and development etc. Discussed in this blog are 4 factors affecting the employee turnover.
1. Paying less than the industry standards
With the help of popular websites like Glassdor and Payscale, every employee can keep themselves updated of the current industry standards. Evaluating oneself on the basis of these standards isn’t too difficult. Even the statistics of individual companies, their reviews, salaries etc. are wide and clear to employees for them to analyze where they stand as per the trends. When they realize that they are being underpaid they tend to seek for better opportunities, thus affecting the turnover ratio of their present organization.
2. Cutting pays
There might come a time when a particular company may not be making handsome revenues and would turn towards pay cuts of employees. This deeply discourages the employees and result into attrition. There are many other possible reasons for which organizations adopt pay cuts and to avoid any backlashes, it becomes important for companies to prepare HR policy and give employees the access to employee handbooks. This helps declare all clauses beforehand, promotes ethical practices on either sides and most importantly, controls attrition and turnover ratio.
3. Impractical and unfeasible expectations
Expecting productivity from a workforce is absolutely justified and for this managers and other authorities have the right to push employees to certain limits. But, this is acceptable only when the process is followed in an appropriate manner and that the objectives have been clarified in advance. Getting the best out of employees is way different that setting up impractical expectations for them. This will result in disappointments for the employee, managers and the company on the whole and will undeniably contribute in a poor employee turnaround ratio.
4. Lack of recognition and growth opportunities
It has several times been noted that money is not the only factor that makes employees satisfied or unsatisfied. Recognitions, appreciations, promotions and better career prospects are factors that build short or long term relationships between companies and employees. When employees are not appreciated for their works and achievements, there often breeds a sense of discouragement. Also, if they are not provided with enough opportunities to learn and grow in their profiles, they tend to feel insecure as their scope becomes limited. Consequently, resignations and job hopping follows, adding to the turnover/attrition rate.
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