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  • Chetan Parikh

Why are your employees leaving?

Updated: Jul 25, 2022

This is a major problem, which is not only faced by startups and MSMEs but is also faced by large companies. Today's generation of young employees, especially Gen Z, have great potential to add value to your business but at the same time most organisations fail to understand what is really required to attract and retain top talent.

Surprisingly it is not money, perks, recognition, or job security. Then what do younger generation employees expect from the employer? It is freedom to decide what they want to do with their time.

Several years back, during the Industrial Revolution, employees worked for survival. They needed to work in order to be able to afford the basic necessities of life - food, clothes and shelter. In the last decade, until the pandemic, employees worked to be able to improve their standard of living. They worked at jobs which would help them pay EMIs for their houses, good education for their children and probably a car. However, the very recent generation of new employees are choosing to work for companies providing work for home, flexible working hours, or as gig workers (freelancers) who can decide to choose their clients, nature of work and working hours.

Unlike the previous generations which worked for survival and necessities, the current generation is working in jobs where they can learn, have freedom to express themselves, and more importantly towards something that they believe in. The following age-old tactics of retaining companies are less likely to work now:

  1. Employment bonds - employees today know to a large extent that these bonds are not enforceable. In our experience, as much as 50% of the candidates will refuse to even interview with companies which ask them to sign a bond. It is not that they are thinking of switching jobs, it is more about not having the constraint.

  2. Retention bonus - it is very clear with a line item of “Retention Bonus paid after ‘X’ months’ that the company is trying to ask employees to stay longer. However, companies need to understand that this is not a ‘candy’ which the employees will take. In all likelihood, the employees, if approached by another company, will ask for compensation to cover the retention bonus which they might miss out on by leaving their current company.

  3. Typical classroom training - all companies get the time management, stakeholder management, business etiquette, compliance training etc. done for their employees. Employees undertake these because they are mandatory, not because they are interested in them. Most likely, the employees aspire to learn skills which will help them grow in their role or make a career move.

  4. Annual appraisals - if yours is one of the companies which undertakes performance reviews and appraisals once a year, you are already behind the curve. To retain employees, you need to continuously benchmark their salaries and be proactive to offer mid-cycle corrections and promotions.

  5. Compulsions on working hours / styles - if you are expecting the employees to punch-in before 9am and punch-out after 6pm; rest assured that your employees are already aspiring to join their friends’ companies which have no punch-in/punch-out restrictions.

So far we listed down practices which employees don’t like. But then, what will work? We believe that companies which are able to align the aspirations of the employees to their missions will see the highest retention. Companies can think on the following lines to be able to attract and retain the top talent:

  1. Work from home - we understand that this is not possible for some companies, but even allowing employees to work from home for 2-3 days every week will go a long way.

  2. Flexible working hours - allow your employees to work at their own pace. Some like to work early in the morning while others like late nights. Giving employees flexibility goes a long way. You will most likely notice that employees become more responsible to get the job done with flexible hours.

  3. Empowerment, not SOPs - employees don’t like to be told what needs to be done. You need to build a culture to empower them to get the results you want. For this, you need to be able to align them to the organisational objectives, give them the room to explore and allow them to ask questions when they need help.

  4. Frequent evaluations of performance and salary - if you hire someone at a salary higher than others, try to give the additional salary as an increment to other employees. If someone gets another job offer and you retain them by offering some perks, try to offer the same perks to others as well. With this, you can stop the employees from getting dissatisfied and looking out for other opportunities.

  5. Rewards and recognition - reward employees with certificates, trophies or gift vouchers, and recognise them for their achievements in front of their peers. This makes the employer-employee relationship non-transactional. It also helps employees take pride in their work. On the spot verbal appreciation works wonders.

  6. Work culture – a culture of accountability in your organisation with least favouritism, nepotism and unfair performance reviews. Having an Individual Development Plan (IDP), especially for the second and third lines, helps bring down attrition.

  7. Induction system – a robust induction process wherein a new employee walks in the desired culture, is excited to join your organisation, and gets familiar with other colleagues, products, services, systems, processes within a couple of weeks. During the induction process, explaining the basic rules, guidelines and giving a copy of an employee handbook with clearly defined HR policies helps the existing and potential employees have clarity on what is expected from them and what they can expect from the management.

  8. Employer brand - build a strong employer brand which is recognised by existing as well as potential employees. This can be done by tracking certain KPIs like attrition rate, application rate, source of hire, and employee satisfaction which help manage your internal employee brand. For potential employees, you will have to constantly update content on social media, Glassdoor and LinkedIn by sharing experiences of satisfied employees, company events, and regularly responding to critical reviews.


At Tamãrõ HR we partner with firms to help them manage their HR functions in the right way. The team at Tamãrõ HR has experienced professionals to help you with all your HR needs from Consulting, Recruitment to HR Operations. To know more contact mail to -


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