CompLogix Blog

How Compensation Affects Employee Retention

At Harvest HCM, we understand how important employees are to a successful business. The very idea of Human Capital Management is that the most valuable resources an organization possesses are its workers, who ensure that it functions smoothly and efficiently. You want to be sure, then, that you’re taking care of your employees in order to ensure their retention. Here are a few ways to help ensure that your employees are satisfied with how they’re compensated, and how our compensation management solutions can facilitate this.

A key way to keep employees happy is to make sure that they feel that their hard work is being rewarded. If they feel as though they’re not receiving the proper recognition for their hard work, employees may become restless and look for other opportunities where they feel they’ll be more appreciated.

Keeping track of succession is another important factor in employee retention. A large factor of work satisfaction is a sense of progression, and of opportunity. Employees will feel more motivated if they have something to work towards. That’s not to say you should be promoting those who don’t deserve it, but you should keep track of how long each employee has been in their current position, and whether or not their performance and experience qualify them to move up that ladder another step. Stagnation is something which leads to restlessness, which leads employees to look for something else.

You should also give those employees who may not be performing as well as expected a chance to excel. If you notice that certain employees consistently perform below expectations, or aren’t improving, it’s a good idea to let them know constructively where their performance may be lacking. The key word here is “constructive,” though – as is common practice, it’s a good idea to not just mention their faults, but to also include their strengths and recognition of the areas in which they perform well.

Finally, providing your employees with a Total Rewards statement allows them to know exactly how (monetarily) much they’re valued by your organization by laying out exactly how much your organization provides them with. Going beyond simple salary and compensation information, a Total Rewards statement includes items such as health insurance, retirement plans, paid time off, and any other benefits they may be receiving. Making these details known to your employees informs them all of the ways your organization provides for them and their families, including in ways they may not otherwise have been as conscious of.

We here at Harvest provide compensation management solutions which can help you in properly rewarding (and thus retaining) your top performers. Our software allows you to plan out merit increases and bonuses, as well as offering succession planning options. We also can integrate with your current performance management systems, letting you keep track of how each employee is performing as you’re completing the salary planning process for your organization. And our solutions allow you to automatically generate Total Rewards statements, making it fast and easy to provide your employees with the knowledge of the full extent of their compensation.

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