Ways To Prevent High Turnover Rate: The Cost Of Replacing Staff

There are different kinds of industries in the world today. They may be different in their products, services, and functions however they may share one thing in common. This is the employee turnover rate. According to business professionals, this is the largest costs of all kinds of industries however it’s costs are unknown. However huge or small its cost may be, one thing is for sure, as a business owner, you are certainly losing money if this happens to you.

 

Understanding the cost of replacing staff can be complicated. For those people who are totally clueless about the cost of replacing staff, here is a brief information on the extent of this ordeal.

For starters, companies shell out money and resources to recruit, interview, hire and train people. They invest in this even without a complete guarantee that he will eventually gain from it. If you calculate this, this would involve a huge amount of money from the company.

Plus this involves the severance packages for employees who are exiting the company. It certainly involves money. When the employee leaves, he is entitled to additional payment based on his months of service, payment for unused vacation or leave, payment with regard to required notice period, dental, life and medical insurance, retirement benefits, stock options, assistance in searching for new work. This may be good news for the employee leaving however for the company, it is a complete loss.

With employees leaving the company, it is not always a smooth-sailing ride. There are complicated situations like the cases where it involves legal battles in court. At times, the company has to pay for the employee’s legal fees.

Experts suggest to spare you from having to go through this rough ordeal, you need to get and implement employee retention strategies. It should be at all time that the employees are acknowledged for their hard work to make them feel they are valued. This way they don't give any reason to leave.

You could commend them for a job well done or to make it more effective, you could go for tangible rewards just like enhancing their work conditions. As simple as changing their hard chairs to ergonomic chairs, it is already a source of motivation. Or giving out gift cards to wellness centers. They would certainly appreciate it.

And there is a lot more of these benefits and rewards programs that are made available for companies to implement in their own businesses. All you have to do is choose which strategy would bring greater results.