Hi All ..
I am facing old employees retention problem in my organization ...Whenever i hire any new employees and if i take them at more salary than the salary of the old employees ...what happens in the bargain ..the old employees resign ..last week i got three resignations ..And how much ever the salary factors are confidential i dent know how they come to know ..Also i tell the old employees that salary depends on the market value and since you were hired before the salary range was less ..but it doesn't work out ..
Also to retain them i have given them a reasonable hike in their salaries too but still this problem is increasing and because of this i am afraid to take new employees on a higher salary scale which i am forced to take because now the market value has increased ..
Please HR Experts give your suggestions as to what shall i do in this dilemma...
Regards
Roop.
From United Arab Emirates, Dubai
1I am facing old employees retention problem in my organization ...Whenever i hire any new employees and if i take them at more salary than the salary of the old employees ...what happens in the bargain ..the old employees resign ..last week i got three resignations ..And how much ever the salary factors are confidential i dent know how they come to know ..Also i tell the old employees that salary depends on the market value and since you were hired before the salary range was less ..but it doesn't work out ..
Also to retain them i have given them a reasonable hike in their salaries too but still this problem is increasing and because of this i am afraid to take new employees on a higher salary scale which i am forced to take because now the market value has increased ..
Please HR Experts give your suggestions as to what shall i do in this dilemma...
Regards
Roop.
From United Arab Emirates, Dubai
Dear Roop,
You are talking about the Market value, Is it not applicable for the Old Employees?
Its better to satisfy old employees first, as they are having experience, loyal to the company and we can trust them. If you are forced to hire new employees, then you need to raise the salary of older ones also according to the market value.
This is cost effective because:
You will lose an old and experienced one with a lower salary range and you need to hire a new and lesser experienced for higher salary (As at the point of hiring, the market will raise). (Double Loss)
You can satisfy your older employee, and increase his productivity by linking the raise in salary with performance.
You can avoid groupism among old & new employees, thus increase in Team work which increased productivity.
You can avoid recruitment costs for replacing an old employee.
Remember, They are resigning because they are getting hike as per market value, then why can't we retain them by doing so?
WHAT YOU SAY???
From India, Mumbai
You are talking about the Market value, Is it not applicable for the Old Employees?
Its better to satisfy old employees first, as they are having experience, loyal to the company and we can trust them. If you are forced to hire new employees, then you need to raise the salary of older ones also according to the market value.
This is cost effective because:
You will lose an old and experienced one with a lower salary range and you need to hire a new and lesser experienced for higher salary (As at the point of hiring, the market will raise). (Double Loss)
You can satisfy your older employee, and increase his productivity by linking the raise in salary with performance.
You can avoid groupism among old & new employees, thus increase in Team work which increased productivity.
You can avoid recruitment costs for replacing an old employee.
Remember, They are resigning because they are getting hike as per market value, then why can't we retain them by doing so?
WHAT YOU SAY???
From India, Mumbai
Thanks a lot Mr Kadam for your suggestion ..
You mean to say we have to hike the salaries of the old employees as per market values ..but if the market values are too high then in that case we would be in a soup ..
Also ..employees take advantage of the same and ask for unrealistic figures ..So we too want to retain them ..but we cannot give the same salaries same as of the new employee because this process will be continuously on and on ..
For example ..if A is getting increment in the month of jan ...and if i am hiring B in the month of April then do i again have to hike A 's salary at par of B's Salary ?Coz this is what is happening in our company ..and i really want to come out of this ..
Please suggest ..
Thanks and Regards
Roop..
From United Arab Emirates, Dubai
You mean to say we have to hike the salaries of the old employees as per market values ..but if the market values are too high then in that case we would be in a soup ..
Also ..employees take advantage of the same and ask for unrealistic figures ..So we too want to retain them ..but we cannot give the same salaries same as of the new employee because this process will be continuously on and on ..
For example ..if A is getting increment in the month of jan ...and if i am hiring B in the month of April then do i again have to hike A 's salary at par of B's Salary ?Coz this is what is happening in our company ..and i really want to come out of this ..
Please suggest ..
Thanks and Regards
Roop..
From United Arab Emirates, Dubai
Hi
Even we have the same problem. Our Communication plays an imp role. In our salary revisions every year, we inform the employees that the revised salaries are based on the market pay/compa ratio, tenure etc. I am not sure whether you have the same policy.
From India, Bangalore
Even we have the same problem. Our Communication plays an imp role. In our salary revisions every year, we inform the employees that the revised salaries are based on the market pay/compa ratio, tenure etc. I am not sure whether you have the same policy.
From India, Bangalore
Dear Mr. Roop,
As an Hr Personnel you must be aware about the fact that Hr is management of Manpower. To manage all this is required a study of Man Power planning. In manpower planning so many issues are invoved therefor it requires the study of not only Human psycchology but it also needs to have through knowledge of Indusrial psychology. Mearlly finacial aspect may not helps us to retain employee or to reduce the tuneover of manpower in an organisation. Tried to dig out the problem where the shew is pinching by making scientific study of the working environment, motivation aspect, opportunity for advancement, motivation factors exist, pay package, recognistion of an employee.
The quarry that you have raise is required to given a due wattage. Let me study first whether I can find out some solution to this problem
Janardan Bhatt
From India, Ahmadabad
As an Hr Personnel you must be aware about the fact that Hr is management of Manpower. To manage all this is required a study of Man Power planning. In manpower planning so many issues are invoved therefor it requires the study of not only Human psycchology but it also needs to have through knowledge of Indusrial psychology. Mearlly finacial aspect may not helps us to retain employee or to reduce the tuneover of manpower in an organisation. Tried to dig out the problem where the shew is pinching by making scientific study of the working environment, motivation aspect, opportunity for advancement, motivation factors exist, pay package, recognistion of an employee.
The quarry that you have raise is required to given a due wattage. Let me study first whether I can find out some solution to this problem
Janardan Bhatt
From India, Ahmadabad
Mr Janardan Bhatt
Thanks for your reply ..
We all here know the fact that we have to do manpower planning and understand the psycology of HUMANS ..and i believe thats the reason we all are in HR ..but if nothing works out that is the reason i am asking all the HR experts here ..So please give a solution if you can rather than finding out deficiencies with the HR .
Regards
Miss Roop.
From United Arab Emirates, Dubai
Thanks for your reply ..
We all here know the fact that we have to do manpower planning and understand the psycology of HUMANS ..and i believe thats the reason we all are in HR ..but if nothing works out that is the reason i am asking all the HR experts here ..So please give a solution if you can rather than finding out deficiencies with the HR .
Regards
Miss Roop.
From United Arab Emirates, Dubai
Hello Roop. There are two parts to my answer about your problem in retaining existing workers. Firstly, what are the facts? How do you know that people are leaving for higher salaries elsewhere? Do you conduct exit interviews? Or employee satisfaction/engagement surveys? They may be leaving for any number of reasons related or unrelated to salary? So, first ensure that you are “fixing” the right problem.
Secondly, once you determine for a fact that they are leaving for higher salaries, review your work culture. Money is just one retainer. Other job factors that lead to job satisfaction and retention are:
-meaningful work
-challenging goals
-treated respectfully
-involvement in decision-making
-having friends at work
-honest and helpful performance feedback
People do not just work for money. Beyond a salary that is not too far below market expectations, these are the factors that keep people turning up for work each day. Find out from your existing employees what they like about their jobs (and do more of it) and what they don’t like. Conduct individual interviews or run a survey. Look up the work of Towers Perrin. They have done a lot of work in the area of employee retention. You can also find our more about how to motivate employees at our HR web site at http://www.businessperform.com/html/...anagement.html
To finish off, some level of turnover is unavoidable and is in fact a good thing as it introduces new ways of thinking and doing to the organization. Find out what level of turnover is typical for your industry. Is yours higher or lower? If it turns out that your level of turnover is detrimental and is caused predominantly by poor salary relativities, then have a strategy for moving salaries in the right direction. First tie salary to performance with a well designed and implemented performance management system that rewards teamwork and high performance. There is no point in trying to keep existing workers that are not performing.
Secondly, have a strategy for moving existing workers incrementally to market rates (redlining) and communicate this well to all workers. With large salary discrepancies, keeping salary levels confidential takes a lot of work and only breeds an atmosphere of suspicion and distrust. By tying salaries to performance, you will be able to pay for the increasing salaries through greater efficiencies and output. The two systems (redlining and pay for performance) will need to be well-integrated. For example, pay for performance will need to be less lucrative for new employees until the salaries of existing employees catch up.
I hope this is of some help to you.
Les Allan
Business Performance P/L - HR Resources
http://www.businessperform.com
From Australia, Glen Waverley
Secondly, once you determine for a fact that they are leaving for higher salaries, review your work culture. Money is just one retainer. Other job factors that lead to job satisfaction and retention are:
-meaningful work
-challenging goals
-treated respectfully
-involvement in decision-making
-having friends at work
-honest and helpful performance feedback
People do not just work for money. Beyond a salary that is not too far below market expectations, these are the factors that keep people turning up for work each day. Find out from your existing employees what they like about their jobs (and do more of it) and what they don’t like. Conduct individual interviews or run a survey. Look up the work of Towers Perrin. They have done a lot of work in the area of employee retention. You can also find our more about how to motivate employees at our HR web site at http://www.businessperform.com/html/...anagement.html
To finish off, some level of turnover is unavoidable and is in fact a good thing as it introduces new ways of thinking and doing to the organization. Find out what level of turnover is typical for your industry. Is yours higher or lower? If it turns out that your level of turnover is detrimental and is caused predominantly by poor salary relativities, then have a strategy for moving salaries in the right direction. First tie salary to performance with a well designed and implemented performance management system that rewards teamwork and high performance. There is no point in trying to keep existing workers that are not performing.
Secondly, have a strategy for moving existing workers incrementally to market rates (redlining) and communicate this well to all workers. With large salary discrepancies, keeping salary levels confidential takes a lot of work and only breeds an atmosphere of suspicion and distrust. By tying salaries to performance, you will be able to pay for the increasing salaries through greater efficiencies and output. The two systems (redlining and pay for performance) will need to be well-integrated. For example, pay for performance will need to be less lucrative for new employees until the salaries of existing employees catch up.
I hope this is of some help to you.
Les Allan
Business Performance P/L - HR Resources
http://www.businessperform.com
From Australia, Glen Waverley
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Retention of Employees.doc
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