The economy can’t stay bad forever, right? As it improves, there’s no doubt employees will be tempted by greener pastures. We talked to HR professionals across the country to find out what they’re doing to retain talent as more options become available.
Doug Alloway, vice-president of HR at the
Edmonton Economic Development Corporation
The not-for-profit organization has 300 full-time employees
Having worked nine years at the Edmonton Economic Development Corporation (EEDC), Doug Alloway says the not-for-profit entity has been relatively sheltered from economic downturns.
“The strong Alberta economy has really softened the effects of the recession felt in other parts of the country…. it’s like Alberta’s in its own little bubble,” he said.
As a result, the corporation, which is partly funded by the City of Edmonton, has not seen much of a difference with turnover rates, says Alloway, who is vice-president of HR at EEDC. At 15 per cent, the turnover rate is higher than he would like to see — but it’s a bit skewed as there are many part-time workers and students at the convention centre.
“We would like to get it down a little bit — you know, around 10 per cent would be healthy for the organization — but we don’t think of it as being abnormally high.”
If the economy continues to improve, it’s unclear what the impact will be and whether it will be “the free-for-all seen back in 2007,” says Alloway.
“Then it comes down to how strong the corporate culture is in each of the organizations. Company loyalty can run deep if you really like your work environment, the people you work with, your boss, so that can temper it but certainly it would stand to reason that as the economy heats up and there’s more choices, then you run the risk of more turnover.”
Even with a tough economy, the EEDC, which has 300 full-time employees, has not really faced tighter budgets or resources, says Alloway. But employee engagement is always a challenge and there are three key areas, he says: effective employee communications; a strong, immediate supervisor you like and respect; and executives acting in a consistent, supportive manner.
“If you can keep those areas quite strong, then you have a good chance of keeping your folks as long as you keep your table stake items competitive,” says Alloway, adding the biggest driver is the immediate supervisor.
“Often supervisors are made to be supervisors because they’re good technicians, and they’re not necessarily given the skills and the training to be effective managers, or maybe even just a good talk about what it means to be a manager, that ‘You have your own work to do but you are responsible for these people and these people look to you for guidance and direction and a clear path.’”
The EEDC has been very strong on managerial skills training, trying to reinforce those appropriate behaviours, he says.
“If you don’t like coming to work for your boss, then all of the other good stuff that a company does kind of falls by the wayside.”
When it comes to employee communications, the corporation holds all-employee monthly meetings where people provide updates on the corporation and various divisions, says Alloway. There’s also a sharepoint web setup that provides information and news feeds and encourages people to blog about their efforts.
“We just try and do as many things as we can so that the people feel they’re connected to the company and what’s going on in the company and the community.”
But does it make sense to change employee benefits, such as compensation levels or health-care, when the economy takes a turn for the worse? That’s always risky, says Alloway.
“The total rewards package is really table stakes for the most part in all economies… companies really just need to keep in step with the competition and, in better times, that may mean increasing your offering to make sure it stays competitive. Things like salary, benefits, perks — it’s all about their perceived value to the individuals receiving them. So… if you’re going to make changes to your program and you feel that you’ve fallen behind and you want to be at least keep competitive, check with your employees and ask them what sort of things they would like to see.”
Focusing on culture is a huge area for the EEDC, especially with a relatively young working population, says Alloway.
“We have to be tuned to the things that are important to those individuals. And that can be a changing dynamic over time but, you know, (it’s about) the importance of work-life balance, the importance of doing things that make a workplace somewhere they want to go. It ebbs and flows a little bit with generations and we have to be responsive to that.”
As for high-potentials, the EEDC targets them indirectly, he says.
“If we have people that show promise, we’ll ensure they’re well-paid and they will often get maybe more training opportunities in the course of the year as things arise maybe than some of the others. They may well be asked to get involved and/or lead special projects as things come up, as a developmental sort of activity, the idea being these people know they’re being given opportunities for development and future advancement, which hopefully they figure out will be a good thing and encourage them to stay.”
Suzanne Hyatt, vice-president of
human resources at Rebellion Media
The Waterloo, Ont.-based digital media company has 150 employees
Until recently, the local technology sector has been relatively insulated from the impact of the struggling economy, according to Suzanne Hyatt, vice-president of HR at Rebellion Media in Waterloo, Ont., a digital media company with offices in Toronto, Seattle and Denver.
“Where there have been restructurings or people that might have been laid off, we’ve tended to do a good job locally of absorbing talent into companies that have continued to hire through challenging times. But, that said, you may see higher turnover rates in a booming economy just by the nature of the fact the industry’s hot and the economy’s improving.”
There’s always going to be natural attrition in the tech sector, says Hyatt.
“In many cases, employees are looking for an opportunity to be a part of building a company — they like the opportunity to see the direct impact of their work and they want to work with smart, passionate people who they can learn from. And then you see a lot of that work hard, play hard attitude,” she says. “As the economy improves, so do these types of opportunities that may be attractive to employees.”
People early on in their careers often have a shorter tenure and it’s more acceptable for them to move around.
“As they gain experience, then you’ll see that those positions they’ll hold will lengthen over time, though I don’t think younger generations or even the mid-generation now definitely don’t have the length of employment that we would have seen in older generations.”
While budgets and resources can be more limited during a recession, many technology companies always have limited budgets, she says. And in that scenario, it’s about the basics: Communications and defining a corporate culture that employees want to be a part of.
“You can do a lot to make your workplace an enjoyable place to work without having to spend a lot. Of course, that gets easier as you have money to put into a budget to work towards those types of things... but you can do a lot just in terms of defining your culture and keeping employees engaged.”
That can include regular or ad hoc staff events, says Hyatt, to boost corporate culture.
“Buying the team ice cream on a hot day doesn’t cost a lot, that’s more of a fun thing to do as opposed to a big expense.”
And when it comes to retention, changing compensation levels or benefits plans isn’t always the answer.
“If someone is set on leaving the organization, they’re going to leave regardless of whether you offer them a richer benefits plan or if you increase their salary by x per cent,” she says.
There’s typically another driving factor behind a person’s desire to leave, such as a better opportunity or lack of growth in his current role, says Hyatt.
“In a strong economy, where business is thriving, you’ll have more freedom... You can offer an enhanced benefits plan and you may just want to build on things that you’re already doing, but it’s important to make sure it’s sustainable because you would never want to give something and be in a position where you have to pull it back, because that’s never received well.”
And if an employer is seeing a higher turnover rate, it should look at the reasons behind the increase, says Hyatt.
“In a hot market, where it might be natural attrition is expected, you would continue to focus on being an employer of choice... create an enjoyable work environment. And then if there is some natural attrition, you’ll continue to attract top talent at the same time.”
And if it’s a matter of higher turnover because an organization is going through challenging times, then it should focus on increased communications to employees and how to ease any employee concerns while emphasizing the need for their continued commitment, she says.
Mike Burgess, director of HR at Xplornet Communications
The Fredericton-based rural broadband provider has 540 employees
With the recent downturn in the economy, Xplornet Communications saw pockets of lower turnover rates — such as in Ontario, where there weren’t a lot of job opportunities. But, overall, attrition rates have stayed more or less the same, says Mike Burgess, director of human resources at the rural broadband provider based in Fredericton.
“The younger generations switch jobs every three to four years, but there’s regular attrition that is bound to occur, especially where it’s been stagnated,” he says.
The company, which has 540 employees, is trying a variety of initiatives to enhance its environment so employees don’t want to leave, he says. These include a comprehensive communications program that has been updated and enhanced over the last four years.
Xplornet has regular contact with employees through a monthly “all-hands” call where the organization is “extremely transparent” about the company’s overall performance, strategy and direction it’s going towards.
“What we’ve found, by providing this transparency to our employees, is there’s a greater sense of trust and loyalty within the organization, especially when they compare and talk to friends at other companies,” says Burgess, who has been at the company six years.
The telecom also puts a big focus on career development and has an internal promotion rate of 76 per cent.
“We work very hard in regards to building programs and setting up opportunities for employees to develop from a career perspective,” he says.
Xplornet also offers an online university, giving employees access to 350 courses in a variety of different topics, along with leadership programs and job shadowing.
To stay on top of employee engagement, the company does a large annual survey along with a scaled-down monthly “pulse check” with about 15 questions, says Burgess.
“We build action plans that are department-specific as well as company-wide, and that way we’re always working on improving certain things to be able to make that difference.”
In a competitive marketplace, up against the likes of Bell, Rogers, Cogeco and Telus, it’s a challenge for Xplornet, he says, but the company tries to provide employees with non-traditional benefits such as career development.
And when the struggling economy made for tighter budgets, the company decided to develop programs internally, with about 12 courses conducted each year by internal subject matter experts.
“We’ve built it so it’s customized to Xplornet, so when we’re talking about a certain topic such as conflict resolution, it’s really tied in with our business — and the company’s employees have really responded well to that,” says Burgess.
“What we’ll do now, as the economy’s improving and the budgets in all areas start increasing, we’ll now layer those opportunities on top of a couple of our existing programs.”
A lot of competitors, especially the new entrants in the market, go with very aggressive compensation programs, particularly on the base salary side of things, he says.
“It’s important that we’re always providing them with well-rounded total compensation, so we do annual merit increases, we review the external market utilizing national surveys to ensure that if there’s any adjustments necessary, we do those as well,” he says.
“And we continue to enhance our benefits program and adding new things in there to provide the coverage so it’s a more valuable component of compensation.”
High-potential employees are also on the radar, not necessarily with more money or more training but with development opportunities and chances to work outside of their traditional roles, says Burgess.
“The profile of employees we’re hiring is they’re really keen in terms of developing themselves to the next step in the organization.”
Rhonda Lawson, senior vice-president of HR and facilities at Genworth Canada
The Oakville, Ont.-based company has 250 employees
Arriving at Genworth Canada early in 2013, Rhonda Lawson took the time to look at key HR trends at the 250-employee organization. And despite the economic downturn of 2008, she found it has had pretty consistent turnover rates, running about four per cent on average per year.
“We didn’t go through the pain that some of the other insurers and financial services companies did in downsizing. We kept a pretty stable environment and we’re very pleased that we didn’t have a lot of turnover in the tough years and we continue to have pretty consistent turnover,” says Lawson, senior vice-president of HR and facilities at the mortgage insurance company in Oakville, Ont.
While the economic crisis certainly called for tightening belts, Genworth has staffed to its levels and used natural attrition to manage staff levels, she says, which has meant no major recruiting or layoffs.
But, as the economy improves, that might change for a niche industry such as mortgage insurance, particularly in functional areas such as underwriting and claims, involving specialists with experience and knowledge.
“Where we might see increased turnover as the economy starts to improve and opportunities become more available is in the areas that support that core business — you know, finance, risk, IT, HR — so very transferable skills.”
But Genworth is a well-managed company, with long-tenured management, experienced managers and a 91 per cent employee engagement rate, she says. “People tend to like to work here.”
“We have very high engagement scores because we get our employees involved in our business. Being a small company, you walk through the office and the CEO’s office is always open, employees can sit and talk with any of the executives. It’s a very collegial and tight-knit little community, so we definitely don’t see a lot of voluntary turnover in this organization and we expect that will continue because we have such an exceptional work environment.”
While the company doesn’t target certain groups, such as high-potentials, it looks at risks and opportunities when it comes to retention efforts, says Lawson.
“We make sure that we have competitive wages, that we benchmark salaries on an ongoing basis with the external marketplace, that we provide a balanced work life environment for employees.”
Like all companies, Genworth has had to “really watch the pennies,” she says, but it’s managed to maintain the same level of compensation and benefits for employees.
“We would rather change other areas of our expenses and our expense management than focus on employees and employee compensation and benefits.”
That means there are still Christmas parties for staff and for kids, along with engaging staff through employee meetings, regular town halls and bringing every employee from across Canada to employee meetings in the New Year.
“We treat employees extremely well and I believe that’s one of the reasons why we have high engagement scores and low turnover,” says Lawson.
“Employees definitely have a voice here.”
Communication with employees is another way to combat higher turnover, especially when it comes to managers, she says.
“A lot of choices to leave, decisions to leave, (are) based on the relationship you have with your peers and/or one-on-one manager. It’s important for management to reflect that culture of the organization, to understand what their role is communicating to employees about strategies, about goals, about objectives, about what we believe as an organization,” says Lawson. “We spend a lot of time communicating to our employees.”
Genworth also takes an “active, aggressive” interest in corporate social responsibility, supporting charities such as Habitat for Humanity, which fits nicely with its vision and values, she says.
“Going forward, you’ve got to have that employee value proposition — why would someone come and work here, what is the reason? It has to have all those components: A culture that people can believe in, a vision that people will aspire to, good marketable compensation and benefits programs, and allowing that employee to engage in the business, not just on a workday basis but an after-work basis as well, through corporate involvement, community involvement and having the organization they work for strongly represented in those spaces as well.”
Amanda Rosychuk, senior vice-president of HR and information services at Epcor
The power and water utility is based in Edmonton and has 2,800 employees in Canada and the U.S.
Voluntary turnover is not a problem for Amanda Rosychuk, senior vice-president of HR and information services at Epcor — she has been at the power and water utility for 21 years.
More broadly, the company’s voluntary turnover rate was highest in 2007, then dipped and in 2012, has started to rise again.
But part of that is explained by an increased number of retirements, says Rosychuk, who is based in Edmonton.
“We do have a very good mix of ages and so I would have to say about one-third of our employees are in that baby boom generation, about one-third of them are like the gen-X and one-third gen-Y, so we’ve got a really good mix. We’ve been planning for some of these demographics for a while,” she says.
But, generally, the power and water industry is quite stable, says Rosychuk.
“Because we are a regulated utility, we tend to have a fairly constant workload and I think employees value the stability that we bring… employees really appreciate that at a time when people they know in other industries don’t have a job anymore. So I wouldn’t say it’s affected us in a large way.”
When the labour market starts to heat up as the economy starts to improve, employers have to be a bit more flexible in terms of thinking of multiple ways to keep employees engaged, says Rosychuk.
That includes recognizing that the next generation has different expectations — they want to deal with their manager differently, they want to be communicated to differently and they expect training and employee development.
“That’s one of the things that we really focus on is making sure that we have strong managers in place and that we have strong programs to develop our employees and keep them engaged,” she says.
Research has shown it’s not so much compensation that sees people leaving but their relationships with managers, says Rosychuk.
“We strongly believe that if we make sure we have great leaders and managers, that’ll set us apart from our competitors in terms of our ability to attract and retain talent, so we have had a number of initiatives aimed at raising the skills of the managers, and our job is really to make sure that those managers have the tools necessary for them to improve their own performance as leaders in the company.”
And while compensation isn’t the only answer, it’s important to be competitive, she says.
“Our experience has been that as the economy heats up, you may have other companies offering slightly higher compensation. But generally we’ve found that you can’t be completely out of the ballpark, as long as your compensation is competitive, if you’re a good place to work.”
And while Epcor is keen to retain all employees, it does put a special focus on high-potential employees, through initiatives such as external educational opportunities and mentoring programs, says Rosychuk.
“It’s very important for us to keep that funnel of talent going, so as the economy gets hotter, those are also the people who tend to be in high demand, so we put a little bit of special effort on those folks,” she says.
“It’s actually largely not (about) compensation — it’s the training, the career development, the mentoring — just that more personal touch.”
And the company has other retention efforts that help reduce turnover, such as one Friday off per month, a flexible benefits program, wellness program, pension plan and a savings plan where the company matches a portion of the employee contributions.
An after-hours personal development program also assists employees in taking training on their own, funding up to $1,500 per year or $750 for part-time employees. And Epcor contributes to charities chosen by employees who do a certain amount of volunteering in their community.
But as the economy improves, there could be a slow increase in the voluntary turnover rate for one group of workers, says Rosychuk.
“One of the things we saw is that when the economy was struggling, some employees who may have chosen to retire ended up working longer because their retirement savings were affected… we’ve got people who have delayed their retirement who might now be thinking, ‘It’s a much better time (to leave)’ as their stock portfolio has improved again.”
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