Best Practices in Finding and Keeping Good Employees

Companies around the nation are developing innovative ways to attract and retain employees. Creative approaches to workplace management have allowed businesses to find and keep a qualified workforce, giving them the edge over competitors who are burdened with the costs associated with a high turnover rate. The following represents examples of policies and practices some have used to make their company an employer of choice.

POLICY: Have a recruitment/retention strategy. Think about the kinds of positions your company must fill, and the skills job applicants must have to fill those jobs. Identify sources of qualified candidates, paying special attention to groups in the community that your company has not reached out to in the past. Identify particular benefits or work opportunities your company offers that will have special appeal to jobseekers.
PAYOFF: When managers and other employees understand their company's recruitment strategy, everyone can play an active role in attracting and retaining qualified workers.

POLICY: Develop creative and flexible working schedules. Flex?time, job?sharing, compressed workweeks, telecommuting and adjustable hours will attract workers who want to balance professional and personal responsibilities.
PAYOFF: Flexible work arrangements attract workers who would normally stay away from a rigid work schedule, and accommodate employees who struggle to balance work and family life. According to an annual survey of employers, 69% offered some flexible scheduling arrangement in 1998.

POLICY: Reward employees for referring qualified job candidates. Current employees can be an excellent source of job applicants. They understand your company, and are less likely to recommend someone who will not work out. Determine how much you've spent on advertising, recruiting, etc. and set a "finder's fee" that reflects the significant savings an in?house referral represents. In other words, don't be cheap! Also, limit the time for employees to suggest names (30?60 days) to encourage a meaningful number of responses.
PAYOFF: Establishes an ongoing recruitment mechanism. Candidates referred by workers generally have more loyalty to the company.

POLICY: Concierge Services/Handyman on staff. Concierge services have become a popular employee benefit. In its simplest form, the service may involve a receptionist who calls to arrange appointments, obtain tickets to sport and cultural events, gather travel information and make dinner reservations. Some employers arrange for on?site dry?cleaning pick?up or laundry service, or hire a person to do free minor household repairs for employees while they are at work. If there is a major problem, the handyman charges it to the company and the employee pays it back a few dollars a month. Certain corporations even hire "house sitters" who wait for furniture deliveries or service calls at employee homes on days when they cannot miss work.
PAYOFF: Companies see workers spend less time in the office dealing with daily chores. One study estimates that for every dollar spent on concierge services, companies get back $1.75 in increased worker productivity.

POLICY: Support health care alternatives not covered by conventional insurance policies. Some companies pay for chiropractic care, herbal therapy and other forms of "alternative" medical care. One company offers monthly massages on company time.
PAYOFF: Most employees view health care coverage as a critical benefit, and will pay special attention to companies offering comprehensive plans.

POLICY: Consider employee rewards other than lump?sum raises. While pay is still the top incentive for employees, they also value other forms of compensation which enrich their personal lives or give them new skills. Instead of giving someone a $5,000 raise, for example, companies can have a greater impact by providing employees more in the form of educational assistance, child care assistance, health club memberships, etc. Certain benefits may still be taxed as additional income, but specific perks often make a more powerful impression on employees than a raise that is spread out over a year and taken for granted.
PAYOFF: More bang for your buck.

POLICY: Partner with banks to get low?cost perks for employees. For example, work with lenders to grant discounted and/or free banking services to workers. Arrange for a bank representative to hold information seminars for staff on financial topics. Or, use Internet consumer information to help do the legwork for employees looking for cheap rates on car, homeowners and renters insurance, mortgages, refinancing and home equity loans.
PAYOFF: The company strengthens its relationship with its lender and the low cost banking services help retain employees.

POLICY: Transportation assistance. Few people know of the new federally funded mass?transit benefit which provides workers up to $65 a month in tax free mass?transit benefits instead of wages. Previously, you could only offer vouchers in lieu of salary increases. The amount will increase from $52 to $100 by 2002. New Jersey employers should also investigate the state's "Smart Moves for Business" program. It offers tax credits and assistance from New Jersey's transportation management associations to help workplaces become more accessible through vanpooling and altered bus routes.
PAYOFF: Employees pay no federal income tax on the mass?transit benefit while your company pays no payroll taxes. Employees without cars find new ways to get to your workplace.

POLICY: Help low?wage employees take full advantage of Earned Income Tax Credits. Employers can help low?wage, entry?level workers take advantage of the Internal Revenue Service program to provide extra income through the Earned Income Tax Credit. Visit the IRS web-site for details: www. irs. gov
PAYOFF: Helps employees achieve a wage level that allows them to stay working.

POLICY: Support your employees' desire to learn new skills. Education and training assistance is a major attraction for employees. Send your employees to seminars and conferences, teach computer skills and encourage continued education.
PAYOFF: Investing in worker education can boost employee loyalty as well as company profits.

POLICY: Help finance home computers. Offer workers cash advances to buy a home computer. Workers can repay the cash advance within a two-year period through payroll deductions.
PAYOFF: Helps improve employee computer skills, and makes it easier for employees to work from home.

POLICY: Expand Tuition Reimbursement. In addition to providing tuition assistance to employees, some companies have extended this benefit to children and spouses of full?time workers.
PAYOFF: Employees may be less likely to leave an employer if special tuition assistance would be lost in the process.

POLICY: Home-buying help. Some companies offer first-time homebuyers who have worked for at least five years up to $2000 to put toward a new home. Others help employees connect with the home loan options offered by Fannie Mae (www.fanniemae.com).
PAYOFF: Employers demonstrate a commitment to the employee and his or her family, and a desire to help them stay in the area.

POLICY: Have Frequent Employee Recognition/Rewards. Don't make employees wait for their annual review to get any positive feedback. Small gestures or unexpected "prizes" can go a long way toward making employees feel valued by the employer. Give employees their birthdays off as paid holidays, allow them to bring their pets to work, give a savings bond to new parents in their baby's name, implement casual dress in the office.
PAYOFF: Little benefits go a long way. For small companies that don't have the financial resources to offer big bonuses and rewards, there are inexpensive ways to recognize employees throughout the year.

POLICY: Develop a partnership with your local schools. There are many opportunities to develop a relationship with your local schools. School to work partnerships and internship programs are a great way to bring new people and skills into the workplace while introducing a student to your industry or trade. Some employers advise school districts on curricula changes that reflect workplace trends, or offer employees as tutors and guest lecturers. Others host site visits and field trips to help teachers demonstrate how science is used in everyday business.
PAYOFF: Internships bring students into the workplace for little or no cost to the company (develop a class credit arrangement with the institution.) For companies looking to hire full time workers, extending offers to your interns from the previous summers decreases training costs for new employees.

POLICY: If you cannot find qualified US workers, investigate foreign workers. Employers must show they have made a good faith effort to hire American workers before they can help obtain employment visas for foreign workers. The annual quota for specialty occupations (H 1?B visas) is filled quickly by hightech workers, but employers should also consider H2?B visas for temporary help, TN visas for professionals from Canada and Mexico, L visas from a company's overseas employees with specialized knowledge of the firm and Q visas for exchange students. (www.ins.usdoj.gov).
PAYOFF: A shortage of skilled labor in the U.S. may not mean the end of your potential labor supply.

POLICY: Reach out to non- traditional sources of labor. There are potential employees in every community that employers have overlooked in the past. Today, employers are reaching out to local community based organizations (CBOs) to establish new ties with minority groups, retirees, the disabled, and people making the transition from welfare.
PAYOFF: There may be unexpected sources of new workers in your area.

POLICY: Longevity rewards. Give special rewards to employees who have been with your company for a long time. Some companies give money, trips, show tickets and gifts to workers who have remained with them for 10 years.
PAYOFF: Rewards dedicated employees and encourages new hires to stay with the firm.

POLICY: Install a revolving door for good employees who leave. No matter what you do, some valuable employees will want to move on. Be supportive of their goals and make them feel welcome to return.
PAYOFF: They will be more likely to return or to send potential employees your way.

NOTE: The following resources were helpful in this compilation of best practices for hiring and keeping good workers.

The Kipplinger Letter Forecasts for Management Decision?making 1729 H St., NW Washington, DC 20006

Forbes Online www.forbes.com April 12, 2000

National Institute of Business Management Success in Recruiting and Retaining 1750 Old Meadow Road McLean, VA 22102

US News Online wvvw.usnews.com November 22, 1999