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Top Tips to Reduce Employee Turnover

June 7, 2012

By: Omnia Group

No, we're not talking about a few extra pounds gained from a tasty, fluffy pastry...the effect of employee turnover hurts! Whether it happens when a good employee pursues an opportunity elsewhere or when a not-so-good one is “encouraged” to find an opportunity elsewhere. After congratulations are delivered (or the whispering stops), your company has to scramble to regain lost footing.

It’s easy to underestimate the overall effects of employee turnover on your company. Although the financial cost is pretty well documented, there are other intangible factors you should consider.

Measurable Costs

The actual dollar impact of turnover is measured anywhere from 3 to 6 months of the now ex-employee's salary.

Expenses to consider:

  • Loss of training and information
  • Time cost of the exit interview
  • Final paychecks and vacation accrual
  • Replacement recruiting, interviewing, and training.
  • Price of overtime or temporary help to cover work


Lower Morale.

If a beloved staff member moves on to greener pastures, the remaining employees need time to respond and recover. They might have lost a leader, mentor, or friend in the office, and the time it takes to move on can impact overall productivity numbers. But even if the person leaving was not all that popular, your remaining employees are still affected. Someone has to pick up the slack, and the added workload can lead to resentment or resistance.

Uncertainty or Insecurity

When someone leaves, there is always the possibility that those left behind will begin exploring their options, too. They might wonder if there is something better out there...maybe the grass really is greener?   They could follow that someone to the new office or use time better spent on work considering these possibilities. If the turnover was not voluntary, the rest of the team could begin to worry about their jobs.

Also Popular: How Personality Tests Help Reduce Employee Turnover

4 tips to avoid employee turnover, or deal with it if it happens:

1. Hire Right the First Time
Ensuring the right cultural and vocational fit from the start can keep people on longer. Do your homework when hiring: Order your behavioral assessments, review the resumes, do background checks, have in-depth interviews, and call references.
2. Fire Quickly
Yes, it may sound a bit harsh...but if it is clear someone is not working out, don’t let them hang around, pouring more money into extra training or closer management to try to force it to work. The longer the problem lingers, the greater the expense to your company. Do yourself a favor, fire quickly, and move on.
3. Use Turnover as a Learning Experience
Have an employee exit interview and learn from it. Although many companies don't take advantage of this opportunity, you will probably never have a better time and a more honest employee than the one leaving your company. Ask, “What would have made you stay? “ It might not be easy to hear, but pay attention to what they have to say and act on it if you can.
4. Talk About It
Transparency is key. Tell your employees as much you deem appropriate about the separation. Remind them of the great points about working for you and your company and reassure your star performers that they are safe and valued.


Omnia Group

For over 30 years, we’ve helped organizations across the world improve and optimize their workforce operations and company cultures. While we take a unique, scientific approach to hiring, development and retention, we also believe every business is a people business. Our passionate advisors always put people first.

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