In the midst of an ever-tightening labor market, employee retention is a hot topic once again.
Here are a few ideas about how you can boost employee morale and retention with just a few tweaks to your existing pay policies. (Let’s face it, your policies were probably written years ago and have nothing to do with the realities of today’s economics or workforce anyway.)
- Double down on loyalty on Day 1 — Let’s say you have a new hire budget of $9.50 an hour for a 40 hour week, but, you luck out and find a great candidate with superb references who accepts your first offer of $9.00. On the employee’s first day, when you spend some one-on-one time together, set clear expectations, and cement future loyalty by saying something along these lines: “I can see you’re going to be a real asset to our team and it’s clear to me you’ll be a great example of what dependability and customer care should look like. That’s why, instead of the $9.00 we previously agreed to, I’ve decided to start you at $9.50 instead. I know you’ll prove I’ve made the right decision.”
- Skip the calendar altogether — The systematic review and reward systems in place today were created for all kinds of sensible reasons, I’m sure, but things change faster and faster these days. Don’t let good people leave because they get a better offer before you’re scheduled to give them their annual performance review and merit increase. Give raises to your best people when they earn them – when they take on new responsibilities, when they save the day, when they clearly outperform most others. Don’t let the calendar undermine your retention efforts.
- The 90-day performance review — In this instance, you have a new hire who goes above and beyond to earn that 25 cents per hour raise new hires are eligible for after three months. How much more bang for your buck would you get if you told them instead: “You have so added so much real value by the way you [specific examples of attitudes and behaviors], that rather than just give you that 25 cents an hour raise starting tomorrow, I’m going to make it retroactive to your first day.” (Do the math; you just spent a whopping $120 “extra” to earn an even higher level of devotion to your cause.)
This originally appeared in Humetrics January 2016 Hiring Hints newsletter.