In recent times, the workforce has witnessed a monumental shift often referred to as the “Great Resignation” or “Great Attrition”. This phenomenon described the mass exodus of employees from their current jobs, as they sought greener pastures or explored alternative career paths. While this seismic change in the employment landscape has largely fizzled out, there are many lessons to be learned from the reasons behind the movement and employees would be wise to take heed of these lessons for the future.

One significant factor behind the “Great Resignation” was the collective reevaluation of work-life balance. The pandemic highlighted the importance of flexibility and remote work options for many employees. As a result, individuals were increasingly unwilling to sacrifice their personal well-being for the sake of traditional work structures. This has led them to seek out employers who prioritize flexibility and offer a healthier work-life balance.

Moreover, the pandemic served as a catalyst for introspection, prompting many workers to reassess their career goals and priorities. Some realized they were no longer fulfilled by their current roles or company cultures, leading them to seek new opportunities elsewhere. Others were inspired by the upheaval and pursued entirely different career paths that align more closely with their passions and values.

While the above reasons for the upheaval of the employment landscape were undoubtedly contributing factors, compensation and financial benefit arrangements, particularly for executives, will always be an important element is keeping and retaining key employees.

For employers looking to attract and retain top talent, strategic planning is essential. Here are some planning tools and strategies they can employ to improve employee retention:

• Flexible Work Arrangements: Offering flexible work hours, remote work options, or hybrid models can be incredibly attractive to employees seeking a better work-life balance. While many businesses, especially those burdened by building leases and high overhead costs are forcing employees back to the office, employers should assess the feasibility of accommodating hybrid work environments.
• Career Development Opportunities: Employees are more likely to stay with an employer who invests in their professional growth and development. Providing opportunities for training, upskilling, mentorship programs, and clear paths for advancement can foster a sense of purpose and progression, encouraging employees to remain with the company.
• Cultivating a Positive Work Culture: A supportive and inclusive work environment is paramount in retaining talent. Employers should prioritize fostering a culture of trust, transparency, and respect, where employees feel valued and appreciated for their contributions. Regularly soliciting feedback from employees through engagement surveys can help identify areas for improvement and gauge overall satisfaction within the organization. Employers can use this data to implement targeted initiatives aimed at addressing concerns and enhancing the employee experience.
• Financial Retention Strategies: Employers should consider implementing personalized financial retention strategies that could involve offering customized benefits packages, such as:
  • Executive Bonus Plans: In its most basic form, an Executive Bonus plan helps your key employee protect his or her family, and build up supplemental savings for retirement, college funding, or for a large purchase. Each year, provided that the employee meets the high-performance standards expected, the employer provides an additional compensation bonus in the form of a premium payment for a cash value life insurance policy owned by the employee. The life insurance death benefit helps to financially protect the family while cash value accumulation can be utilized as supplemental savings.
  • Retention Bonus Plans: A Retention Bonus or Stay Bonus Plan is a relatively simple concept and strategy. In consideration of your employee staying for a predetermined period of time (e.g., 5 or 10 years), when that time period is met your employee will receive a substantial lump sum bonus. If they don’t stay for the time period required, they don’t get the bonus. This plan is offered very selectively.
  • Non-Qualified Deferred Compensation (“NQDC”) Plans: NQDC Plans are popular to recruit, retain, reward and retire top-level and highly skilled employees. These plans are only available to “select management or highly compensated employees” who may not be able to save enough for retirement in a traditional qualified retirement plan such as a 401(k) plan, because of various legal limitations placed upon the retirement plan. NQDC Plans provide key employees with additional retirement benefits not available to rank-and-file employees, provided conditions of the plan are met.

While the changes in the employment landscape during the past several years presented challenges for employers the effects of the upheaval appear to be long lasting. For business owners willing to adapt, it also offers an opportunity to reassess priorities within the company and invest in the professional development, positive work culture and financial benefits necessary to not only retain top talent, but also attract new recruits in an increasingly competitive job market.

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