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8 Factors That Could Be Affecting Your Employee Retention

Employment laws and regulations lay the foundation for fair and equitable treatment in the workplace. However, savvy employers recognize the value of exceeding these minimum standards to cultivate an environment where employees feel respected, engaged, and loyal. National Employee Appreciation Day serves as a timely reminder for employers to not only celebrate their workforce but to also critically examine existing strategies for boosting employee satisfaction and retention. This introspective process is crucial for fostering a workplace where employees feel valued, motivated, and committed to the organization’s success. Here’s why this evaluation matters:

  • The Cost of Turnover: High employee turnover disrupts operations, strains productivity, and leads to significant financial losses due to recruitment and training expenses.
  • Enhanced Sense of Trust: When employees feel valued and supported, they are more likely to proactively address workplace concerns directly with their employer. This fosters an open communication channel for potential issues like discrimination or harassment, enabling employers to resolve them swiftly and internally, potentially preventing costly and damaging lawsuits.
  • Competitive Advantage: Companies known for prioritizing employee well-being have a distinct edge in attracting and retaining top talent. This positive reputation improves brand image and bolsters long-term success.

Factors Affecting Employee Retention

Several factors influence whether employees stay or leave an organization, including: 

  • Pay and compensation: Competitive salaries and benefits are essential for attracting and retaining talent. This point is particularly salient given Washington’s recent laws requiring employers to include the offered salary and benefits in all job postings. This transparency may cause existing employees to regularly evaluate whether they are fairly compensated.
  • Work-life balance: Offering flexible work arrangements, remote work options, and encouraging breaks can help employees maintain a healthy balance between work and personal life. For example, employers can make the most of protective employee leave laws, and Washington State’s PFML program, by proactively implementing legally compliant family leave policies and encouraging employees to take advantage of these programs to demonstrate a genuine interest in employee satisfaction.
  • Job satisfaction: Employees who find their work meaningful, challenging, and enjoyable are more likely to stay. Regularly conducting “stay interviews” with valued employees helps an employer understand their concerns and preferences and identify areas for improvement. This also provides an employer an early inside track to potential hostile work environment, harassment, or discrimination concerns in the workplace that may otherwise go unreported.
  • Company culture: A positive, inclusive, and supportive work environment is essential for employee engagement and retention. Employers may benefit from reviewing existing anti-harassment and discrimination policies for currentness and ensuring they accurately address modern employees’ concerns. For instance, employers may want to consider updating policies to speak to transgender employees (i.e., handling private health information, what name will appear on legal documents, bathroom usage, etc.).
  • Management and leadership: Effective communication, fair treatment, and manager support significantly impact employee satisfaction and retention. Again, employers should encourage management to be open and inquiring to the workforce to ensure that minor workplace problems are not allowed to fester and spread in costly litigation down the road.
  • Recruitment: Hiring people who align with the company culture is crucial for long-term retention. An employer may want to update its hiring policies to ensure its hiring team has a clear path to hire a qualified workforce while complying with all laws regulating discrimination during the hiring process.
  • Training and development: Investing in employee training and development shows the organization’s commitment to their growth and keeps their skills relevant.
  • Benchmarking: Comparing your organization’s retention rates and practices with competitors can provide valuable insights and identify areas for improvement.

In short, exceeding legal mandates isn’t just a matter of good practice; it’s a strategic investment benefiting both employees and the organization as a whole.

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