Employees Have Options, Treat Them Well!

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As is normal in a longer-term healthy economy, we have seen the job market get ever tighter for employers searching for qualified applicants for key positions. As is also normal in this type of economic cycle, we have seen that employees are much more comfortable quitting their positions to look for something that better fits their needs when they become uncomfortable with some facet of their work environment. While some turnover can be beneficial in that it brings in fresh perspectives, often turnover causes problems within an organization as you struggle to not only find the right replacement for the position, but also to get the new person up-to-speed quickly.

The key to keeping your employees longer is to treat them well. Some ways in which to ensure you keep those key individuals that you want to keep include the following:

  • Yes… fair compensation is important. I wouldn’t be honest unless I mentioned the obvious. Yes, it’s important to pay fairly. If you pay dramatically less than prevailing market rates, you leave yourself open to losing an employee for reasons that could have been prevented. You don’t necessarily have to pay the highest compensation in the market, but you do need to at least come close to whatever the market pay is for similar positions. It’s not always simply an economic decision for employees; sometimes is a matter of whether or not they feel respected by their employer, and if that shows in their paycheck.
  • Reasonable workloads. Everyone wants employees that will go “above and beyond” when needed, but if that need occurs over and over, you leave your team with a feeling of burnout. In some cases, employers will even begin to think it’s not an issue because the team continues to get the work done even though additional effort is needed practically all of the time. This can lead to an even bigger issue – multiple resignations. Make sure you assess the reasonableness of the workload periodically to make sure you are not taking advantage of your team. They may put in extra effort for a while, but if the need becomes never-ending, you will find yourself with openings to fill.
  • Flexibility around family needs. Another area where there needs to be give-and-take is in the area of flexibility. Do you expect your employees to “pitch in” and help in other areas when necessary? Do you expect them to stay after hours when there is a deadline to be met? That is the case with most employers. If it holds true for you as well, then some flexibility on their side is generally appreciated. Giving additional flexibility to employees that have family-related demands on their time goes a long way towards building goodwill. Yes, if it becomes detrimental to getting goals accomplished, then something has to change. But if the job still gets done in the end, then a little flexibility really doesn’t have any downsides.
  • Adequate benefits. This is another area where you don’t have to necessarily be the best, but it’s important that you do at least try to provide something that is comparable with the market. Some provision for medical insurance and some paid-time-off are generally expected. You may not be able to cover all of the associated costs, but having some type of reasonable medical coverage is practically an assumption for professionals in today’s market. Vacation and sick leave, or PTO, is also expected, and frankly not that costly. At a minimum, these two benefits should be offered. Not doing so leaves you exposed to the probability of quick turnover. It’s easy in today’s market for your employees to find another employer that offers these basic benefits.
  • Know them personally. This is a touchy area, but deserves some discussion. Is it possible to go too far in getting to know your employees on a personal level? Of course it is. However, is it also possible to alienate your team because you don’t express any concern about them outside of work? Definitely! Make sure you at least have casual conversations with your team members about safe items outside of work. People are less likely to resign when they feel that they work with a friend, versus simply working for a boss.
  • Understand what they value. This is perhaps the most important factor. Understanding what is truly important to each of your team members, and then acting on it, is the best way to ensure low turnover. It’s easy to assume that we know what an individual employee will value, or even worse make broad-based assumptions based on what others value. However, all employees are unique and while some may highly value one aspect of the job, others may find no value at all in that same benefit. We all know this, but given our busy schedules, we frequently fall into the mistake of depending on an assumption without taking the time to get to know each individual. The better you know each individual team member, the longer they will stay with your organization.

While some turnover is inevitable, and can even be healthy, excessive turnover definitely will cause severe issues within your company. The first step to decreasing turnover is to realize that your team members really do have options. However, if you treat them well, they are much more likely to stick around.

I hope these tips have been helpful for you, and as always, I wish you the best in all your endeavors.

Mark Goldman CPA