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Boosting Employee Retention: HR's Strategic Role

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It's the question that employers ask themselves again and again: How can I get my employees to stay long-term?

Employee retention is currently one of the top concerns for companies, which is due to three main factors:

  • A highly competitive job market
  • An uncertain economy characterized by sky-high inflation, causing nervous workers to seek better wages and benefits and greater job security
  • Lasting effects of the COVID-19 pandemic, such as: employees' desire for a change of role or industry, for a better work-life balance and for flexibility in the workplace (also known as "The Great Resignation")

To win the war for talent and encourage employees to stay at your workplace, you need a well-thought-out and effective employee retention strategy.

There are a variety of tips on how managers can retain their employees. But did you know that your HR department can be one of your biggest assets when it comes to employee retention?

Below are eight ways your company's human resources department can have a direct, positive impact on your employee retention strategy and serve as a valuable partner alongside management.

1.Hiring practices

If you want to have talented, productive employees with long-term loyalty to your company, it's incredibly important that you hire the right people for the right job from the start.

It's not just about an applicant meeting all the criteria in terms of training, experience and technical skills. It's also about finding the right culture for your company.

The HR consultants in your HR team can help your company:

  • Find candidates who match the job requirements as well as the company's values and culture.
  • Guide candidates through the application process and give an excellent first impression of your company.
  • You ask the right interview questions to determine whether an applicant is the best fit.

This can save your company from the worst effects of poor hiring decisions. After all, dealing with employee turnover and starting the hiring process from scratch because you hired the wrong person is time-consuming and costly. Hopefully, with HR's expertise and resources, you can hire once and then hire the right people.


The first days and weeks of a new employee in a company are crucial. During this time, employees can either get off to a good start and set themselves up for success, or they can feel lost, overwhelmed, or left out - and think they made a mistake in joining your company. Such negative thoughts will only become entrenched over time.

Through an informative and effective induction and orientation program, HR professionals can help you avoid the most common new hire mistakes so you can:

  • Introduce new employees to their new roles and initiate training
  • Introduce new employees to their team members and management
  • Familiarize employees with the mission, vision, values and culture of the company
  • Provide employees with a sense of belonging and purpose
  • Make sure employees know and understand everything that is available to them as part of your company's benefits package (the "total compensation," which includes, for example, health insurance, 401(k) retirement plans, paid time off, employee assistance programs, and wellness programs included)
  • Explain your company’s value proposition to employees

In this way, the human resources department makes a decisive contribution to ensuring that employees:

  • To feel comfortable at your workplace
  • To have a pleasant, positive start to their employment relationship
  • To get all your questions answered and to avoid misunderstandings or ambiguities

3.Pay and benefits

When employees leave a company, they often do so in search of better pay and better benefits. Therefore, employers should not only ensure that their employees are paid fairly, but also that they remain competitive.

The compensation and benefits experts on your HR team can set up a reliable, timely payroll process and:

  • Compensation benchmarking, regular, ongoing research, data collection and analysis to verify that your company's compensation is in line with industry standards, your competitors and local market prices
  • Support management in developing a compensation strategy - or at least help in developing it
  • Refine salary ranges for positions and effectively communicate this information to job candidates
  • Maintaining pay equity
  • Avoiding salary compression
  • Support in determining the content of service packages
  • Support in the development of bonus programs for employees
  • Establishing reward and recognition systems for employees

4.Training and development

To feel comfortable in a company in the long term, employees want to know that they have a viable career path there, with opportunities for internal mobility and continuous learning and development of their skills.

In this area, the HR team can collaborate with management and support their efforts by:

  • Supervision of training plans
  • Recommend or require specific training
  • Identifying future leaders and top performers who are eligible for promotion
  • Development of a human resources strategy for future planning
  • Support with succession planning

5.Employee experiences

A positive work environment or an employee's experience can determine whether they stay in the company. When we talk about “employee experience,” we mean what it’s like to work at your company day in and day out. For example:

  • How do the employees work?
  • How do colleagues interact with each other?
  • How accessible are HR and management?
  • Are the company values actively demonstrated from top to bottom?
  • Do employees feel comfortable expressing their opinions and being honest?

Everyone in a company, from leadership to entry-level employees, has the responsibility for maintaining the company's culture and values. However, HR can be a strategic partner to management in creating a desirable work environment.

Specifically, the human resources department can:

  • Communicate transparently with employees.
  • Establish an open-door policy and make it clear to employees that they can approach HR with their concerns and complaints at any time without fear of retaliation - and that they can trust HR to address these issues appropriately becomes.

Additionally, your HR team can make it easier for employees to access their benefits and complete HR-related tasks through a self-service portal. In this way, the human resources department can reduce friction that previously existed in employees' everyday work.

6.HR Compliance

Most people want to feel safe and valued in their workplace and want to be associated with a reputable company that is committed to high standards and values.

Your HR team can be very effective at retaining employees if they:

  • Ensuring your company complies with all labor laws
  • Set up company-wide training on compliance topics as well as ethics and values
  • Committed to the safety and well-being of employees
  • Enforce a zero-tolerance policy for violations such as discrimination and harassment
  • Fully investigate all allegations of non-compliance or violations of human resources policy and act quickly when necessary

7.Employee feedback

Once you have had a termination conversation with an employee, it is too late. While you can get constructive feedback about your workplace that you can use in the future, you've already lost the employee.

If only you could know in advance what issues an employee is having with your company before they decide to leave, right? As it turns out, you can.

Your HR team can help you take the pulse of your workforce by conducting periodic employee surveys to gather feedback about the company and then interpreting the data. With these insights, HR managers can work with management to identify potential problems or opportunities for improvement and create plans to implement changes.

Conversely, your HR team can also conduct interviews with long-time, high-performing employees to find out what works well to increase employee morale and engagement, and what your company should do more of.

8.Analysis of employees

Your efforts to understand employee mindsets and reasons for resignations don’t have to be limited to surveys and interviews. Many companies today are using HR technology, data analytics and artificial intelligence to get to know their employees better and more proactively.

People analytics is the process of collecting and examining people data to uncover trends and insights that can help HR teams accurately identify:

  • Which employees are most at risk of leaving
  • Why they could leave
  • What steps you can take to get them to stay

Don't have sufficient HR resources?

If your company doesn't have its own staff or has a small HR team that needs support, a professional employer organization (PEO) can improve your employee retention strategy. Here are some examples of how a PEO can help:

  • Access to high-quality benefits and benefits typically associated with large corporations for small and medium-sized businesses - at competitive prices
  • Advice from experts in the areas of culture, training, leadership development, team building, succession planning, benefits and compensation analysis - to name just a few topics
  • Conducting employee surveys and interviews
  • Providing best practice guidance on HR compliance
  • Implement employee recognition programs
  • Providing access to HR technology that enables advanced analytics

All in all

Employee retention is a major challenge for many employers due to the complex work landscape. Among their many valuable benefits, internal HR teams and PEOs play an important role in directly influencing some of the key factors that influence employees' decisions to leave or stay, as well as helping management implement one successful employee retention strategy.

In the battle for talent, HR stands as a strategic ally in retaining employees. Utilizing HR practices effectively can bolster retention efforts and foster a thriving workplace. Explore how HR software like IceHrm can streamline HR processes, enhancing employee experiences.

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