Employee Retention Rate can also be known as Employee Turnover Rate. When Employee Turnover Rate is used as a KPI, basically, you WANT some turnover, and whilst you don’t want to REWARD a manager for firing people, you don’t want to penalize them for the poor performers leaving. The formula to calculate annual rentention rate or employee turnover rate is:
Sum of staff departures over the year divided by Sum of Monthly Staff Headcount
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Autumn Jane