Employee Retention Program - Stage 2

Summary

These projects have arisen as a consequence of growing concern within the meat processing industry regarding employee retention and turnover. In 2005, Meat & Livestock Australia conducted a number of Industry Forums on Retention, the results of which were summarised in a report entitled Retention: Exploring the Issues (MLA, 2005). This report stated that the increasing difficulties in retaining skilled, effective workers amounted to a looming crisis within the industry, and called for the development of effective workforce retention strategies within the industry.

The research found that turnover for the 12 months prior to data collection had increased significantly in all plants, with annual estimates ranging from 37% through to 90%. For a medium-sized plant, costs associated with this degree of turnover were estimated to be between $650,000 and $1.3 million per annum.

The project found that there was considerable variability in the manner in which data on employee voluntary turnover information was recorded and stored. This severely limited the degree to which plants were able to use this information to accurately monitor turnover trends and to diagnose factors underlying poor employee retention. Some plants collected exit interviews, but the information they generated was not regarded as being particularly useful or useable in most cases.

Measures obtained from a sample of nearly 600 employees indicated that there is considerable scope for firms to improve employee job embeddedness, a factor linked to employee retention, by adopting measures designed to increase employee fit, strengthen links, and intensify sacrifices both on- and off-job.

Links refer to the formal or informal connections people have, both on and off the job, either between themselves and institutions (e.g. sporting or community organizations; work project teams; financial commitments; home ownership; schools) or with other people (e.g. family, friends and co-workers).

Fit is defined as a person's perceived compatibility or comfort with an organisation and with his or her environment.

Finally, Sacrifice is defined as the perceived cost of material or psychological benefits that may be forfeited by leaving one's job.

In addition to a number of specific recommendations made to individual plants, following generic retention strategies were proposed for meat processing plants:

• Improve collection and analysis of turnover data
• Modify use of exit interviews
• Setting targets and establishing managerial accountabilities in respect of retention
• Developing and communicating an employee value proposition
• Step up community-based activities in relevant labour markets
• Select more rigorously, based on fit to the organisation
• Emphasise teamwork and employee engagement
• Train more intensively and broadlyIncrease organisational communication
• Offer employment security guarantees
• Reward based on organisational performance
• Improve job design and working environments.