Employee Retention Incentives: How Can We Implement Them Effectively?

Hi all,

I am working as an HR Exec. Trainee and would like to discuss Employee Retention Incentives. How can this incentive program be implemented effectively?

Please reply.

Thank you.

Dear Shell,

Employee retention has become very important for industries. You can implement retention incentives in the following forms:

1. By rewarding employees who have completed 3, 5, 7, or 10 years.
2. By awarding a special memento to each employee who completes 1, 2 years, and so on.
3. By sponsoring employees who have completed 5 years for higher/professional studies such as an MBA or other vocational courses.

I believe this may help you solve your problem. If you would like to frame a policy and need any help, feel free to ask.

Manoj Verma

Dear Shell,

Actually, I am not in HR. I work as Manager of International Alliances and Business Development at a software company in Mumbai. However, being in middle management and part of the decision-making group, I do formulate policies and discuss HR issues.

The subject you seek help in is one of the most challenging issues. People will always come and go, and there is no fixed policy for employee retention. Still, as an HR executive, you can take certain steps. Here are some suggestions:

1. Convertible assets, e.g., My company has provided me with a new laptop for use. After 3 years, it will become completely mine by paying a small amount.

2. Loan facility: After around 2 years, I can avail an interest-free loan from the company.

3. Shares/stocks: Providing stock options to employees can make them feel a sense of ownership and encourage them to work towards maximizing dividends on the shares.

4. Internal recruitment: When a vacancy arises within the organization, internal employees should be allowed to apply. This enables them to progress within the company according to their career growth plan. For instance, a senior developer could apply for a Team Lead position if one is vacant.

5. Bonds: Employees can be required to sign a contract with the company upon joining. This should be clarified during the interview process.

6. Retainer amount: A portion of the salary can be withheld and paid at the end of a specified tenure, along with interest. For example, if 4k out of a 50k salary is retained each month, the employee would receive the accumulated amount with interest upon completion of the specified period.

7. Bonus: Companies can offer a bonus equivalent to one month's salary when an employee completes a year in the company or a specified timeframe.

Feel free to share your own ideas on the matter. You can find valuable insights on CiteHR as well.

Please refer to #96972.

Take care.

Regards,

Debadutta Nayak

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Bonds/retainer amount and loans in excess of salary run a risk of the employer being branded with "forced labor" and not a legal and effective option as well. Stick to employee engagement methods:

Career planning: Do you really plot an employee's career? If a manager gets promoted further, do you have a succession planning in place?

Have a "fast track" option wherein star performers are given visibility, extra managerial responsibilities, and a roadmap e.g. 18 months to being a team lead/manager. Education also works wonders; if this doesn't work, then encourage dating and get the people married - then they will stick (on a lighter side). Stick to.

Appraisal has to be a transparent process. Fix Key Performance Indicators (KPIs) for every position, track weekly progress, coach employees every month/trimester, and at the end of the year collate 52 weeks of data. This will solve problems of lack of trust and fair opportunities for everyone. Start internal job postings. You may have a loyalty bonus; pay it in installments every quarter. Have an employee referral scheme and pay employees a sum marginally less than what a consultant gets. Every person has a different path in life and is motivated by different things at different phases in life.

Surya