General Inquiries

Key Personel - Employee Retention Policies

  • 1.  Key Personel - Employee Retention Policies

    Posted 01-24-2020 11:00
    In an effort to retain a key employee for many years to come, we would like to offer an employee something to be given to them down the road.  The initial thought was to offer them an amount of money after 5 years of employment, another amount of money after 10 years or employment, etc.  This would not be tied to job title changes or performance (these would still be given on annual reviews) or company performance for that matter, but strictly for staying with the company.  We are trying really hard not to lose this employee. Is there any sort of standard to this?  If an amount of money is chosen, what should it be and how long should the vesting period be? 20% per year over 5 years, 10% per year over 10 years, 0% until the  5 year mark or 10 year mark, etc?

    Thanks in advance for help on this.

    Jordan Davidson
    Accounting Manager
     
    1033 Lafayette Ave
    Terre Haute, IN 47804
    812-232-3700 Office
    812-235-6757 Fax


  • 2.  RE: Key Personel - Employee Retention Policies

    Posted 01-24-2020 11:08
    We have just initiated a plan to give employees additional PTO for years of service. Every 5 years of service they will receive an additional 8 hours.
    For an example 5 years-88 hours, 10 years-96 hours, 15 years-104 hours

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    Mary Bohm
    Staff Accountant
    General Air Control
    Tucson AZ
    (520) 887-8850
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  • 3.  RE: Key Personel - Employee Retention Policies

    Posted 01-25-2020 13:13
    I was one of those key employees and ended up leaving after 18 years. Here's the thing -- if you want to keep them, have honest conversations with them. Make it safe for them to tell you what they like about their job, as well as what they don't. Get to really know them and find out what motivates them. One size does not fit all in this area. It may be a flexible schedule, it may be the monetary reward you are thinking about. It may be the company culture. It is said most employees leave a job because of their supervisor, assuming they are paid a fair wage. If you do go with monetary, make sure it's enough to entice them. But in the end, who wants an employee sticking around (even if they're awesome) for a monetary reward? Wouldn't you rather have them stay because they love it, are engaged in their position, feel like they are contributing, as well as being taken seriously and are appreciated? 
    Deborah Congden





  • 4.  RE: Key Personel - Employee Retention Policies

    Posted 30 days ago
    This may be non-traditional thinking but I am not a fan of the "golden handcuffs" approach to employee retention.  If someone is unhappy with their job and want to get out of there and the only reason they are sticking around is to get a reward at 5, 7, or 10 years (or whatever period is chosen), all you do is have an unhappy employee on the team while they wait for the specified period so they can get their money, bonus, 401(k), or whatever the "carrot" is and then bolt somewhere else.  Unhappy employees can ruin a company culture fast if the attitude spreads, so I do not believe it is healthy to retain unhappy people on the team.  My belief is you need to take a look at why this person wants to leave and use that as a tool to evaluate the company culture, benefits, compensation programs, etc. and see where you can improve.  Sometimes people leave and there isn't anything you can do but I believe the right culture is a bigger retention tool than a financial reward that keeps an unhappy person coming to work each morning.

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    Ben Curtis CPA
    CFO
    SIRQ, Inc.
    Lehi UT
    (801) 828-8307
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