How to Reduce Employee Turnover?

How to reduce employee turnover

Most companies find that employee turnover is reduced when they address issues that affect overall company morale. By offering employees benefits such as reasonable flexibility with work and family balance, performance reviews, and performance based incentives, along with traditional benefits such as paid holidays or sick days, companies are better able to manage their employee turnover rates. The measures the company will take to retain its employees depend on employee replacement costs, but also on overall company performance. It is relatively rare for people to leave jobs in which they are happy, even when offered higher pay elsewhere.Most staff have a preference for stability of job.Company may reduce the employee turnover by facilitating money item and communication item.

Money Items


By providing handsome salary the organization can keep their employee. Employees care about being paid equitably with others in similar positions making comparable contributions.

From the survey it is found that when two or more employees perform similar work and have similar responsibilities, differences in pay rate can drive lower paid employees to quit. In a like vein, if the organization pay less than other employers for similar work, employees are likely to jump ship for higher pay, if other factors are relatively equal. The organization must make sure they are offering competitive compensation package.


The survey is showing that employees find the process of appraisal more satisfying and credible when it is directly linked to award a bonus or reward outcomes. Bonuses may be awarded to recognize the accomplishments and contributions of individual employees. Every separate Bonuses payment is a reminder to the employee of the value of his or her personal effort, and serves to encourage the type of behavior that leads to superior job performance. While Bonus payment is given towards the employee, they contributions more to increased organizational productivity. It becomes easier for the managers for the development and implementation of improved work processes, exceptional customer services provide by the employee, other specific contributions to the success of the organization. The organization should try to set up bonuses based on performance. The extra pay for performance set up a competition that would get out of hand with work done in haste and the workers abusing other workers to gain the upper hand . Maybe just a surprise of occasional bonuses could motivate employee which leads lower turnover.


The organization has to establish a vacation policy to prov ide full-time employees with a period of rest and relaxation without loss of payor benefits. All regular fulltime employees begin accruing vacation benefits beginning on the date of hire.

Regular part- time employees working a minimum of 20 hours per week accrue vacation on a pro rata basis. Temporary employees and employees who work less than 20 hours per week do not accrue vacation benefits.

Other Benefits & Perks:

The benefits the organization provides should be based on feedback from workers. The organization develop an overall strategic compensation package that includes gain-sharing plans, benefit plans to address the health and welfare issue of the employees, and cash rewards and perks. To be competitive in today’s labor market, the organization must find it necessary to offer a standard benefit package, including health, dental, and life insurance, and investment and retirement plans. These benefits often prove exceptionally attractive to employees and can be great tools for reducing turnover.