Chapter 3

Employee Retention

Tasnuva Rahman
EASTERN UNIVERSITY
“High performers are like frogs in a
wheelbarrow they can
jump out at any time.”
Components of Individual Performance
 Absenteeism

• Controlling Absenteeism
Types of Absenteeism
- Disciplinary approach
- Involuntary - Positive reinforcement
- Voluntary - Combination approach
- No fault absenteeism
- Paid time-off programs

Number of person - days lost throu gh job absence during period

 100
(Average number of employees)  (Number of work days)
 Employee Turnover

• Voluntary versus Involuntary

• Functional versus Dysfunctional
• Controllable versus Uncontrollable

Turnover rate =
Number of employee separations during the month
 100
Total number of employees at midmonth
 Turnover Costing Model

• Job title: ______________________

A. Typical annual pay for job: $ 20,000
B. Percentage of pay for benefits (40%): $ 8,000
C. Total employee annual cost(A+B): $28,000
D. How many employees voluntarily quit in this job in the past 12 months: 20person
E. How long does it take for one employee to become fully productive(in months): 3months
F. Per person turnover cost: (E/12*C*50%):
G. Annual turnover cost for this job(F*D):

* Assume 50% productivity throughout the learning period(F)

 Retention of Human Resources

• Why People Stay

– Great company
• Value and culture, well-managed, and offers exciting challenges
– Great job
• Freedom and autonomy, exciting challenges, and career advancement and growth
– Compensation and lifestyle
• Differentiated pay package, high total compensation, geographic location, and respect for
lifestyle
Retention Determinants
The Retention Management Process
 Employee Retention & HRM

Performa Engage
nce &
Motiva Commi ment &
Job
tion Satisfacti tment Retenti
on on
Thank You