Employee Retention: A Guide
There is not a single sector that has been spared from the onslaught of the COVID-19 pandemic. While the mobilization against the pandemic is quite relevant, one cannot shy away from the number of livelihoods that have been directly impacted by this outbreak.
With economies dwindling, even major players of multiple sectors are struggling to stay afloat. Small size business, medium-size operations, sales, aviation, travel, lodging are few of many sectors whose numbers have an all-time low. Slowly but surely, the long-lasting repercussions of countries going into lockdowns are seeing the light of the day, with job security bearing the brunt first.
If numbers are to be cited, more than 22 million Americans have lost their jobs in the past month alone. Mitigating these trying times whilst concentrating on employee retention is the area we will focus on in this article.
The relationship between employer and employee is not an extension of just monetary benefits that come with the job description. More often than not, it transcends to smaller and more vital elements of world culture, built through the team and colleagues contributing to that environment, the ability to grow as an individual in terms of honing skills to add to the growth of the organization and of course inculcates a routine and discipline (which is a factor open for debate).
When hit with a pressing situation like one at hand with COVID-19 the organization, tends to fall down the rabbit hole of
- Cash crunch
- Pressure from Investors to minimize the losses or increase the profits
- Unavoidable cash outflows
- Shortage in demand for company’s products and services
which inadvertently causes this dynamic to shift. Ideally, given an opportunity, both employee and management would like to continue with the current employer/employee. Following are the alternatives that the organization can imbibe at the entity level to weather this storm
Telescopic payment
Employees tend to save a portion of their earnings, for a rainy day. This may range from 0% to 50% depending on the earnings, commitments, lifestyle, spending habits, other income, family background etc.,. Taking this into consideration, there can be an offer by the employer to accept part payment of salary for a deferred period. The company may offer to compensate for the payment foregone during the period with an incentive in the form of interest, additional increment in the subsequent performance review, among many alternatives.
Company Ownership
Accountability yields results. Employees can be offered to accept the company’s options/stocks at a discounted price to compensate for the payment foregone for the predetermined period, leaving them with a sense of loyalty and purpose towards the organization.
Loyalty Incentive
Incentives lead to productivity. The easiest way to give back the sense of security to an employee is by considering the employee’s loyalty and trust in the organization. The additional incentive offered to the employee after a said period, without any conditions attached to it, creates that environment of a satisfied employee.
Priority
Employees opting for it shall have priority over non-opting employees for company schemes announced in the future, and a portion of the new scheme allotments shall be earmarked for such loyal employees.
Flexibility
Employees may opt for any of the above initiatives and may switch to other options partially or fully after the said period, at their discretion, to their satisfaction.
Last Resort — Leaders First, Benefits, then Jobs
It is important to note that Employees have first preference over the company’s debtors, shareholders, and other dues, in case of company liquidation and winding up in a worst-case scenario. Given the crises the industry is going through, there is a need to seek relaxations from level up and then move down the hierarchical pyramid to tide over the bad times.
One of the hardest questions in economics is mobility versus stability. What happens to workers who are displaced by recessions, technological and industrial change, regional shifts, or corporate failure? Can humans move fluidly from occupation to occupation, industry to industry, and city to city, like interchangeable parts in a well-oiled economic machine, always going to where their contributions will be most rewarded and their talents utilized most effectively? Or would workers be better off if the government and corporations helped them weather the economy’s ups and downs by staying in place?
There’s no good single answer to this question. Maybe the answer lies in that optimal mix of stability and mobility that doesn’t go to either extreme.
