Human Resource Management: Gaining a Competitive Advantage Chapter 10 Employee Separation and Retention Copyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin

Learning Objectives  Distinguish between involuntary and voluntary turnover and discuss how eachcan be leveraged for competitive advantage.  Listand apply major elements that contribute tothe perceptionof justiceto disciplineand dismissal.  Specify the relationship between job satisfaction and job withdrawal and identify sources of job satisfaction.  Design and use a survey feedback intervention program to promote retention of key personnel. 10-2

Introduction  To compete, organizations must ensure:  Good performers are motivated to stay.  Chronically low performers are allowed, encouraged or if necessary, forced to leave.  2 Types of Turnover:  Involuntary turnover—initiated by the organization (often among thosewho would preferto stay).  Voluntary turnover—initiated by employee (often those the company would prefer to keep). 10-3

Managing Involuntary Turnover  Employment-at-will doctrine- in the absence of a specific contract, either an employer or employee could sever the employment relationship at any time.  Violence in the workplace caused by involuntary turnover has become a major organizational problem in recent years.  A standardized, systematic approach to discipline and discharge is necessary. 10-4

Principles of Justice  Outcome fairness-the judgement that people makeregarding outcomes receivedrelative to outcomes received by others with whom they identify.  Procedural justice- focuses on methods used to determine the outcomes received.  Interactional justice- refers to the interpersonal nature of how the outcomes were implemented. 10-5

Progressive Discipline 2 Components of Discipline Programs DocumentationProgressive Punitive Measures 10-6

4 Determinants of Interactional Justice 1. Explanation 3. Consideration 2. Social sensitivity 4. Empathy 10-7

Peer Review Open Door Policy Mediation Arbitration 4 Stages of ADR 10-8

Employee Assistance Programs  EAPs attempt to ameliorate problems encountered by workers who are drug dependent, alcoholic, or psychologically troubled.  EAPs are usually identified in official documents published by the employer.  There are several issues in controversy regarding EAPs. 10-9

Outplacement Counseling  Helps displaced employees manage the transition from one job to another.  Services such as job search support, résumé critiques, job interviewing training and networking opportunities may be provided in-house or through an outside source.  Aimed at helping people realize that other opportunities exist

Managing Voluntary Turnover – Job Withdrawal  Progression of Withdrawal Theory-dissatisfied individuals enact a set of behaviors in succession to avoid their work situation.  3 categories: 1.behavior change 2.physical job withdraw 3.psychological job withdraw  Withdrawal behaviors are related to one another, and partially caused by job dissatisfaction

Job Dissatisfaction- Job Withdrawal Process Causes - Job dissatisfaction - Personal disposition - Tasks&roles - Supervisors& coworkers - Pay&benefits Manifestations - job withdrawal - Behavioral change - Physical job withdrawal - Psychological job withdrawal Job Dissatisfaction Job Withdrawal 10-12

Behavior Change  An employee's first response to dissatisfaction would be to try to changethe conditions that generate dissatisfaction.  When employees are unionized, dissatisfaction leads to an increased grievances.  Employees sometimes initiate change through whistle-blowing - making grievances public by going to the media or government

Physical Withdrawal  4 ways a dissatisfied worker can physically withdrawal from the organization: 1.Leave the job 2.Internal transfer 3.Absenteeism 4.Tardiness  Companies spend 15 %of payroll costs to make up for absent workers on average

Job Satisfaction and Job Withdrawal  Job satisfaction is a pleasurable feeling that results from the perception that one's job fulfills one's important job values.  3 aspects of job satisfaction: 1.values 2.perceptions 3.Importance  Frame of Reference serves as a comparison for other points and provides meaning

Pay and Benefits Tasks and Roles Sources of Job Dissatisfaction Personal Dispositions Unsafe Working Conditions Supervisors and Coworkers 10-16

Unsafe Working Conditions  Each employee has a right to safe working conditions under the Occupational Safety and Health Act of 1970 (OSHA).  Financial bonuses linked to specific safety related goals help keep employees focused and pay for themselves over time.  Firms that emphasize safety send workers a clear signal that they care about them

Sources of Job Dissatisfaction  Personal Dispositions  Negative affectivity is a dispositional dimensionthat reflects pervasive individual differences in satisfaction with any and all aspects of life.  Tasks and Roles  The nature of the task itself is the key predictor of job dissatisfaction.  Job Rotation  Prosocial Motivation 10-18

Sources of Job Dissatisfaction  Supervisors and Coworkers  A person may be satisfied withhis or her supervisor and coworkersdue to: –shared values, attitudes, and philosophies, –strong social support  Pay and Benefits  For many people, pay is a reflection of self worth, so pay satisfaction takes on critical significance when it comes to retention

Survey Feedback Interventions  Surveys:  emphasize overall satisfaction.  assess the impact ofpolicy changes.  allow the company to compare itself with others in the same industry.  allow the company to check for differences between units and benchmark “best practices.”  If people fail to see timely actions taken on matters identified as problems in the survey, satisfaction is likely to be lower than it would be in the absence of a survey.  Any strategic retention policy has to consider surveying people who are about to become ex-employees

Summary  Involuntary turnover reflects a separation initiated by the organization.  Voluntary turnover reflects a separation initiated by the individual. It can be minimized by measuring, monitoring and surveying, then addressing problems found in the surveys.  Organizations can gain competitive advantage by strategically managing the separation process.  Retaliatory reactions to organizational discipline and dismissal decisions can be minimized