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Retention Tool Kit Ideas - Part 3
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July 08, 2008
In the last part, we talked about Employee Relations tools. A second way to differentiate you from other employers is through your Compensation programs. Many times we believe that employees want more money for less work. In fact, more often than not, money is not the motivator. However, if you cannot offer top dollar, due to market or other constraints, then you must find other ways to compensate your employees.
Again, you need to show your employees WHY working for you is the best choice in town. This is where your tool kit will help you. Use Compensation tools to prove that you are an EOC! Below are some tools that you could use along with brief explanations:
Compensation:
•Competitive salary structures: Obviously this is very important and pretty self-explanatory. Base your salary on marketplace movement, competition, workforce supply, and other economic factors in your area. Check your market at least once a year.
•Sign-on bonuses: This will attract people, but not necessarily keep them. The quality of candidates you get by using this strategy isn’t always good. Make sure that you protect your investment in the person – they are eligible to receive the sign-on bonus after x-number of hours worked or days.
•Retention bonuses: You can be creative with this one and apply it to things like college tuition, training programs, etc. A suggestion here is that you entice the candidate to stay on by spreading the payment of these bonuses over time – not in a lump sum. Reimbursement programs or monthly bonus payments after a specific period is more likely to keep employees who appreciate your investment in helping them achieve their goals.
•Retention contracts: "Golden Handcuffs" where the employee agrees to remain with the company for a set period of time in exchange for a monetary award; provided that misconduct, poor performance or litigation will nullify the contract. Be reasonable in determining your time period as your business dictates and allows.
•Pay-for-performance programs: This can be applied to training or continuing education courses, as examples. Offer a pay increase for every course or a certain group. Be reasonable with the raise. Show appreciation to the employee’s time, effort, and willingness to go the extra mile.
•Promotions: Succession planning is a good tool to show investment in your employees. Promoting someone to team lead, mentor, or supervisor (with support) will add value in many ways.
