Employee turnover is a natural aspect of any business, but high turnover can be a challenge for any Human Resource team. Every employee that leaves takes a significant chunk of your time to process. By using a pay-for-performance system it prevents taking awaying time to find new employees by compensating the right employees with the correct amount of STI (short term incentive) ultimately creating a lower employee turnover.
Better Employee Retention Helps you to Maintain an Optimal Workforce
High employee turnover can be bad for business. It can create unease, affect morale and cost a company in both time and recruitment fees to find a suitable staff replacement.
Retain your Employees with Pay-for-Performance
The time required to find and interview new staff can be costly to your business. Reading through CVs, using a recruitment agency and conducting multiple interviews can take hours away from production time.
The secret to retaining the best and most effective employees is recognising your top performers and compensate them accordingly. According to Giga Information Group, retention can be improved with pay-for-performance – by up to 27%.
Employees are in retrospect able to control their financial situation. This enables managers to avoid overcompensation of under performers, a mistake that frequently leads to top performers leaving with complaints of unfair treatment.
