Struggling with Employee Turnover in Manufacturing: Is Holding Certificates a Fair Solution?

We are a steel manufacturing unit in Maharashtra. There has been a significant employee turnover in our company. After valuable training, employees are leaving our organization and joining other companies, even though our compensation policy is reasonable.

Employee Retention Strategies

In order to retain such employees, can we keep their original certificates in our custody until the fulfillment of the contractual agreement? I kindly request experts here to advise me or provide an alternate solution to this perennial problem.

Thank you very much.

Regards

Dear Prashant, thank you very much for your instant response. In regards to your question regarding the exit interview, no, we did not have an exit interview. As you suggested, we will start with this. To date, our understanding is that they have been offered a better position and compensation due to their training and experience.

As additional collateral, can we take custody of their original certificate, which will be returned once they fulfill their contractual agreement?

Thanks once again.

Bonded Labor and Employee Retention Strategies

Bonded labor is prohibited in India. Be careful before starting any such activity. If employees leave for a better position and better compensation, do you have any plan regarding "Succession Planning"?

Yes, I believe there must be other factors; we are also trying to identify the concrete reasons. Thank you for the response.

Certificate Custody Practice in India

There is a practice in India where IT companies take employees' certificates into their custody at the time of appointment. If this is the case, why is it not common in other industries? When you have a fair contract as per the law of the land, the question of bonded labor does not arise. Can you please clarify your stand on the certificate custody issue?

Thanks, Jagdish and Prashant.

Please find attached the document on retention policy.

Thank you.

As an HR professional, I have also worked for 1.5 years in a large steel industry. Based on my experience, you may consider the following points:

1. Revise your appraisal policy.
2. Implement the promotion policy as suggested by Prashant.
3. Increase the level of employee engagement with the firm.
4. If possible, try to implement a flexible and wide overtime policy.
5. Identify areas of high employee turnover in operations. If feasible, have discussions with a few former employees over the phone on their day off.
6. Ensure there is no workplace bullying resulting from supervisory bureaucracy.
7. Organize employee welfare activities such as family get-togethers.
8. Ensure that the organization's vision and mission are clearly known to all employees. If not, arrange seminars to highlight the management's vision.

I believe these suggestions may be helpful for you.

Regards,
Mangesh Wakodkar
Aurangabad

Keeping the original certificate of an employee as security is illegal, and you cannot mention it anywhere as a valid document. Please try to understand what I want to state. Do not waste your time by thinking about the security policy by which you can keep an employee with you. There is no provision in the Constitution of India by which we can detain an employee without his/her wish.

Understanding Employee Turnover

It will be better if you give importance to understanding the reasons why employees are not willing to continue in your organization. You will definitely get the reasons.

Psychological Changes in Employment

You can notice a significant psychological change among the employment class which has greatly affected organizations in the last decade. Nowadays, employees are more aware of their job security than money. Employees can compromise with salary if they are getting a good professional environment that can provide them with good exposure in the future.

Regards

Employee Retention Strategies

Firstly, I am fully satisfied with Prashant. You need to start exit interviews at your organization to identify the background factors contributing to the turnover ratio. Secondly, you need to review your compensation policy because money plays a vital role in motivating employees to either stay in a job or consider a change.

Regards,
Sunil Sharma

Retention of Employee Qualification Papers

Retention of an employee's original qualification papers is highly illegal, apart from being immoral. I would definitely suggest obtaining a bond from the employee, duly countersigned by a family member or a net-worthy person. This is a compulsory method.

Alternative Methods for Employee Retention

There are other methods. You may yourself chalk out a future development program for the employee. This may include not only the scope of climbing up the ladder in your own organization but also other market futures.

One needs to look at the employee's point of view also, and the solution lies in the development of a long-term strategy.