Employee retention is discussed a lot these days because the labor market for certain types of employees, especially tech and other high-skilled workers, remains competitive and attrition or turnover is costly for the organization in many ways. For example, the cost of replacement, lower workforce morale, training costs, lost productivity, to name a few. It’s been proven through many studies that companies with low employee engagement have higher attrition rates, making the company more susceptible to unionization. In fact, at UnionProof, we think of it as a domino effect that, in reverse, goes like this: improving employee engagement improves employee retention, which significantly improves the chances of staying union-free because it means you’re doing something right.
Quality of Effective Leaders is Not Strained
Attrition refers to employees who voluntarily leave. Turnover encompasses people who voluntarily leave, and those involuntarily laid off or terminated. The interesting point to keep in mind is that even a high rate of involuntary terminations can be due to much more than someone proving to not have the right skills or not able to reach productivity standards. Managers may be doing a poor job of recruiting the right people. Still, it could also be due to low morale in the workforce leads people to let their productivity fall, which results in termination, or they become agitators who try to convince others the management doesn’t care about them.
So, though attrition and turnover are technically different in definition, the same workplace issues impact both. Catalyst assembled some statistics from various sources and for the United States and found:
- Talent shortages will affect the financial and business sectors by as much as $435.7 billion by 2030
- Total quit rate in 2019 was 27.9% and has steadily increased since 2015
- 15% of the total turnover was voluntary
- Half of all employees have thought about leaving their employer
- Negative workplace culture contributes to turnover, and 75% of workers surveyed said management is responsible for setting the tone in the workplace
- Estimated cost of voluntary turnover was $617 billion in 2018
- The estimated cost of turnover due to workplace culture for the past five years is $223 billion
A Sense of Belonging Can Improve Employee Retention
Catalyst research on inclusive leadership also found, “Managers who practice both leading outward, demonstrating accountability, ownership, and allyship, and leading inward, demonstrating curiosity, humility, and courage, may increase retention.” The research reported in the Harvard Business Review found that workers who feel like they belong are linked to a 50% drop in turnover risk. Improving retention comes down to the quality of leadership and how well your managers and supervisors engage employees. To take liberties with Shakespeare’s line, effective leaders’ quality flows freely with transparency, emotional intelligence, and a genuine desire to help employees meet their personal goals.
Why Are You Leaving?
The Work Institute’s 2019 Retention Report offers insights gleaned from more than a quarter-million employee interviews as to why people leave their jobs or the factors influencing the employee retention rate. The report contains statistics that show employers directly influence whether employees stay or go. Following are a few of them:
- 22 out of 100 employees left for career development
- 11 out of 100 left for work-life balance
- 11 out of 100 left for manager behavior
- 9 out of 100 left for compensation and benefits
- 8 out of 100 left for the well-being
- 8 out of 100 left due to job characteristics
- 5 out of 100 left due to the work environment
Retention Directly Impacts Union Vulnerability
The factors influencing attrition or the employee retention rate are the same factors affecting your ability to stay union-free. Matching the factors one-by-one to identify how the causes of attrition are related to the causes of unionization yields the following:
- Management biases influence employee career development and promotion opportunities, or there is a lack of job security
- Employees are unhappy with work schedule demands or lack of scheduling flexibility
- Managers lack practical leadership skills
- Compensation schedule is not competitive, equitable or fairly administered, or benefits don’t meet employee needs
- The workplace is stressful and causing health issues
- Employees receive poor training, have limited resources, have job overload or are not a good fit for the job due to poor selection during the hiring process
- The organizational culture is toxic, and/or the work environment is unsafe
Organizations that are claiming any of these reasons for attrition has left itself vulnerable to unions. Often, a business that can claim one factor can claim multiple factors, but poor leadership skills are woven through all the reasons. For example, a lack of effective leadership means managers don’t know how to handle conflict to minimize employee stress or fail to do a good job of balancing workloads or figuring fair work schedules. An ineffective leader doesn’t know how to develop positive employee relationships, which support a positive organizational culture.
Beyond the Illusion of Communication
Communication is central to employee engagement, making it one of the most critical employee retention strategies. Per the Retention Report, 38.6 percent of new employees quit within the first year, and lack of communication was vital. Employers are not communicating details of the job, schedule, or pay, or are hiring employees who are not a good fit just to fill a vacant position. Ensuring the quality of onboarding, orientation, and early training is one of the best steps an employer can take to become an employer of choice and stay union-free.
Walter Orechwa, CEO and Founder of UnionProof and A Better Leader, explains, “Retention begins with hiring – consider a Pre-Hire Orientation video that honestly describes the company, the job and the expectations for the position. Crucial to any business is the retention of its workers. Care must be given to provide the proper wage, benefit, and career growth opportunities to all employees. Your onboarding of new hires should include an orientation video with the company’s union-free philosophy as a part of that consistent message.”
Conduct Surveys to Measure Employee Satisfaction
Employers should identify where they are not meeting employee expectations or needs, which they can achieve through surveys. It’s also a good idea to conduct an employee survey(s) before and after you execute any form of training, to get an accurate depiction of how effective it is. This is an excellent indicator of your ROI. Engaged employees are more likely to be productive consistently– which leads to more revenue.
George Bernard Shaw said, “The single biggest problem in communication is the illusion that it has taken place.” Many managers tell themselves they communicate with their employees, but are they? Are they sharing the information employees need to do their job to the best of their ability? Is management transparent in decision-making? Do employees have a voice? Is management routinely giving feedback?
Discovering the Real Reasons
Giving employees a voice is another one of the most important employee retention strategies that leaders can employ to learn about employee needs and concerns, in order to address them. It’s a way to find the real reasons people quit and the best path to improving the employee retention rate. Regularly get employee feedback, analyze it, and develop the appropriate responses, which could range from explaining management decisions with honesty to making significant changes to company policies and procedures.
Good leadership skills clearly have a direct and positive impact on attrition rates, and low skilled leaders have the opposite effects. Poor manager and supervisor behaviors (leadership skills) include poor communication, lack of manager competence, unprofessionalism, and lack of support for employees. This type of management will inevitably lead to high attrition or high turnover because employees, as the saying goes, leave managers and not their jobs. However, poor leadership skills also contribute to low employee morale and low employee engagement in the remaining workforce.
An Opening For Unions
It’s a perfect opening for unions looking for disgruntled employees. Unions target the working people and their reasons for leaving but not the people who leave.
Retaining your leaders is just as important as retaining their employees. When you consider the cost of losing just one of your managers and the amount of time it could take to train a replacement, leadership training that focuses on lowering your turnover rate and increasing Retention would yield a high ROI.
Pay Now or Later
The Work Institute’s survey also learned that 3 out of 4 employees who quit could have been retained. Looking at it from a different perspective, 77% of the reasons employees left were preventable. Attrition costs companies more than $600 billion annually. It gives a new perspective on the cost and ROI of initiatives like leadership training. It is reminiscent of the 1972 FRAM oil filter commercial’s expression, “pay me now or pay me later, pay me you will.” The implication is that, if you don’t pay now, you will end up paying more later.
Companies that fail to invest in leadership training resources, add equity to compensation schedules, address workplace safety issues, strive to create a positive organizational culture, or invest in resources to stay union-free will end up paying much more due to attrition and unionization. It’s fair to say the cost of unionization is an ongoing financial burden on businesses during the length of the union contract.
Investing in the right resources ranks high among employee retention strategies. A key takeaway is that you must invest resources to improve engagement, which leads to good things like lower attrition and lower risk of unions finding a means of leveraging employee dissatisfaction, something they are very good at doing. You must invest in leadership training and development, so they learn practical listening skills, how to receive and give feedback, how to manage change (a fact of life today), and more. Your managers need emotional intelligence and soft skills, as well as hard skills. Anyone can develop policy, but not everyone knows how to communicate the policy’s reasons and how it benefits employees.
The Big Picture is in the Details
Developing communication skills is stage one of improving employee engagement and Retention. The next stage is implementing a strong communication system so your managers can reach all employees on the devices and platforms that meet their individual needs. This includes communicating via social media, emails, face-to-face, and videos. Many companies now ensure their communication processes are accessible via multiple devices, including desktop computers and mobile technologies (smartphones and tablets).
Invest in Tools to Improve Employee Retention and Stay Union-Free
Finally, invest in union-free tools, which include training modules and a union-free website (dark website). UnionProof developed a full range of products, tools, and services to stay union free or work towards decertification if already unionized. They were designed based on decades of experience with unions and deep research into union behaviors, from the initial recruitment of an employee through the union campaign to negotiations. It’s a quagmire of aggressive behaviors that can catch your leaders off guard if they don’t have high employee engagement or know how to recognize the signs a union is active.
You can rely on UnionProof, A Better Leader, and Projections to offer all the leadership and employee training resources you need to ensure you are doing everything you can to begin improving employee engagement and improving employee retention. Pay attention to the details of training and communication, and you’re also much more likely to stay union-free.