Retaining a dissatisfied employee: Is it worth it?

Employees may quit even after being offered a promotion or pay hike

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Ramnath, a financial analyst with one of the top ranking global banks of the world, was not really happy with his job. It was not as if he wasn’t getting paid well or was facing any culture-related issues. He wasn’t in conflict with his manager either. In fact, he really respected his manager for mentoring him throughout the three-year tenure he had spent with the firm.

However, somewhere, Ramnath was unable to strike the right work-life balance. The job was quite demanding and he spent several hours working on his projects, unable to give much time to his family and friends. This resulted in dissatisfaction with the job, and one day, Ramnath decided to quit taking his manager by surprise.

Being a top-notch performer in his team and a valuable employee for the company, his manager wasn’t letting him go. He offered to promote Ramnath, and even gave him a substantial pay hike. The offer was irresistible, and Ramnath happily accepted it.

“Sometimes, it is difficult for certain employees to settle down. And if it appears like too many things need to be changed for a single employee, it is better to let that employee go”

Uma Rao, VP-HR, Ashok Leyland

Three months later, Ramnath again put in his papers! Why? After the promotion, he became busier than before with more projects and even lesser time for his family. He realised that a pay hike or a promotion was not what he needed. He simply wanted some time off work.

Ramnath’s employer, however, could not really understand what Ramnath wanted.

The organisation had invested in retaining this talent, yet, eventually, he left.

There are many such Ramnaths out there and as many employers wondering where they went wrong.

Should a dissatisfied employee be retained?

There is no straightforward ‘yes’ or ‘no’ answer to this question, admit HR leaders to HRKatha.

Before we get to the point of retaining the person with pay hikes or promotions, we should first analyse the reason for the person’s dissatisfaction. “First ,we should investigate and find out exactly why the employee is dissatisfaction,” says Rattan Chugh, HR leader.

There can be many reasons for an employee’s dissatisfaction. “As HR professionals, it is up to us to investigate and find out. Whether it is about compensation, or a misunderstanding between the employee and his manager / colleagues or whether the person is finding it tough to settle into a new culture or setup, it is up to us to find the root cause,” shares Uma Rao, VP-HR, Ashok Leyland.

Only after investigating and discovering the reason for resignation, can the next course of action be decided.

“The cost of hiring a new employee is two to three times higher than retaining one”

Rajesh Balaji, CHRO, Matrimony.com

The general belief amongst HR leaders is that if a higher performer is not satisfied with the salary, the organisation should always try to retain that person by offering a hike or other benefits. “We can look at giving a new role to the person, a salary hike or even ESOPs in case of a critical talent,” says Rajesh Balaji, CHRO, Matrimony.com.

If the person is facing problems with his manager or colleagues, the matter should be sorted out. “We should have a dialogue with the employees and their managers and colleagues and try to sort things out. Taking them into confidence, we should assure the outgoing employees that things will get better in the coming future,” recommends Rao.

What if the employee is getting an excellent offer elsewhere?

“If you can match it, well and good. If not, it’s better to let the employee go,” advises Rao.

When is it better to let the employee leave?

In cases where there may be some behavioural issues with the employees wanting to leave, it is ideal to just let such employees go. “Sometimes, it is difficult for certain employees to settle down. And if it appears like too many things need to be changed for a single employee, it is better to let that employee go,” says Rao.

“In fact, if there are behavioural issues with the employee, then we should definitely introspect and find out why the person was hired in the first place,” suggests Chugh.

In most cases, the experts believe that it is better to retain employees because hiring new employees is more expensive than holding on to old ones. “The cost of hiring a new employee is two to three times higher than retaining one,” points out Balaji.

“There can be situations where the employees may be highly skilled and extremely competent, yet low on motivation. In such cases, we can analyse what drives such employees and retain them”

Rattan Chugh, HR leader

Should low performers be retained?

Most companies would not want to retain low performers. It would be best for such employees to move on and take up another opportunity.

However, sometimes, even low performers can be highly competent. “There can be situations where the employees may be highly skilled and extremely competent, yet low on motivation. In such cases, we can analyse what drives such employees and retain them,” says Chugh.

Balaji also agrees that when it comes to low or average performers with rare skills and high levels of competence that are tough to find in the market, it is better to retain them.

It all depends on the concerned employees and the value they add or will add, if they stay on. After analysing this, a decision can be taken whether to retain them or let them go. Getting to the root cause of the person’s dissatisfaction may be the key.

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