14 employee retention incentives to strengthen your company & reduce churn

Retaining employees is a challenge because there are two dimensions to the problem: You have to put energy into keeping your best talent, but you also need to create a bigger-picture strategy that leads to more loyal, committed employees. In light of that, it’s not enough to invest in one-off employee incentives to reduce attrition. Rather, consider how you can make your organization a place where people want to work in the long term.

And since the problem of turnover isn’t going away any time soon,* the time to start rethinking your employee incentive programs is now. 

We’ve put together a comprehensive list of employee retention incentives for executives, HR professionals, and managers looking to build a stronger work culture that leads to greater employee loyalty.

‍*McKinsey, 2022
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1. Create a culture of feedback & recognition

If you think performance reviews are the only time you should give employees feedback and guidance, think again. There’s a strong correlation between employee satisfaction and frequent, constructive feedback. 

Employees not only need continuous feedback to feel valued and grow as professionals — they also want it.

Here’s how that works in practice:

• Share feedback a few times a week — Communicate positive or constructive feedback directly after an employee completes a task or action. You can also offer praise and recognition during your informal 1:1 check-ins and at the end of team meetings.

💡 How do you create a culture of continuous feedback when your teams are spread across multiple cities and countries?

‍Use Leapsome’s Instant Feedback module, which also integrate with Slack and Microsoft Teams.

• Pair every piece of feedback with an action or goal — Telling an employee they need to work on their communication skills isn’t specific enough. Offer suggestions on how they can practice better communication and give them a target. For example, encourage your report to send a follow-up email or Slack message summarizing lengthy conversations or meetings.
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• Connect constructive criticism with your team member’s professional goals — If an employee wants to become a team manager, make sure your feedback helps them develop soft skills that are relevant to leadership positions, like listening, prioritization, coaching, and problem-solving.
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• ‍Listen to employees — To create a robust culture of open communication and employee recognition, feedback needs to be a two-way street. That means managers should keep open minds, as they have to be receptive to constructive criticism from their reports. The insights they gather from those conversations will help them learn how to better support their team.

 “There have been times in the past where I’ve thought of ideas that might be helpful for boosting well-being and retention, only to discover they weren’t successful in practice. By asking the right questions and really listening to the answers, I was able to identify exactly why these initiatives weren’t working. 

For instance, one well-being benefit I initiated was a subscription to [a meditation tool]. I had anticipated lots of engagement and positive feedback and was surprised to discover this wasn’t the case. While my employees appreciated the opportunity, it was becoming another pressure to add to their already full to-do lists. I learned what they really needed was more flexibility in their schedules.”

‍— Alex Mastin, CEO and founder of Home Grounds

2. Allow for flexible work schedules

A recent study from Slack’s Future Forum revealed just how valuable flexible work schedules are to employees. Professionals with full flexibility say they’re 29% more productive and have 53% better focus. They’re also more likely to feel connected with their manager and team members than their in-office counterparts.

If you want to take advantage of the benefits flexible working arrangements can offer your company, here are some things to consider:

• Employee preferences. Some people prefer hybrid work arrangements for in-office interaction and accountability, while others enjoy working completely from home with no distractions. Survey everyone at your organization to see what works best for them.
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• Your business needs. Depending on your industry and internal requirements, it may occasionally be necessary for your entire team to be in the office. In that case, set up one or two ‘in-office’ days a week where staff meets in person.
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• Where employees live and work. Considering where team members live and what time zones they work in will help you determine when they’ll be available to collaborate and communicate.
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3. Provide helpful tools & technology

Technology exists to simplify the ways teams collaborate. The right tools make data visualization, reporting, and communication easier. 

Your tech stack can also play an important role in enhancing the employee experience and boosting retention. But you should consider software solutions beyond those that streamline collaborative work, like project management or messaging platforms.

Explore people-centric software that focuses on:

• Employee engagement — A platform like Leapsome, for example, lets you run pulse and 360° feedback surveys. You can also use our tools to determine your employee Net Promoter Score (eNPS), which tells you how likely your staff is to recommend your company as a great place to work.
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• Rewards and recognition (R&R) — R&R tools can help you design incentive compensation plans and policies based on employee input as well as real-time internal and market data. They also let you automate the process of celebrating birthdays, employee milestones, and achievements.
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• Employee development — Employee development software helps managers and team members track performance and collaborate on individual goals. Development software lets you create structured plans, so people know exactly what to do to move up the ladder or get a raise. 
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4. Offer more opportunities to upskill & grow

‍Employee training and development opportunities factor heavily into job seekers’ decisions. In a 2022 SHRM research report, 48% of employees reported that training opportunities influenced their job choice. But development is even more impactful for your current workforce, with over seven out of ten participants saying they’re more likely to stay in their current position if they have access to ongoing training.

But today’s professionals aren’t just interested in onboarding videos and one-off training courses. They want their development to be current and relevant to their individual roles and value methods tailored to their learning styles.

Update your training and development program by:

• Presenting information in a variety of ways. Consider blending self-paced online courses with instructor-led courses and webinars.
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• Incorporating coaching and mentorship. Integrating a coaching or mentorship element into your training program can be a low-cost yet highly engaging way to reinforce learning, bolster professional relationships, and put lessons into practice.
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• Giving employees a stipend to learn on their own. Provide staff with a personal learning budget to use in a variety of ways: books, coaching, external webinars, and more. You can also implement a tuition reimbursement program to compensate team members for any courses or classes they take outside of work.
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5. Take care of your remote workforce

Remote work gives employees the autonomy and freedom they desire over their working hours and location. That’s why it’s growing in demand — 87% of employees choose remote work when it’s an option. Knowing this, how can future-oriented organizations ensure they don’t treat their remote workforce like an afterthought?

• Take advantage of technology — Encourage managers to set up regular check-ins with their direct reports via video chat. While there’s so much we can do asynchronously now, employees still need face-to-face interaction to build trust and connection.
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• Overcommunicate expectations — Don’t worry that you’ll sound like a broken record when articulating your values, providing context, or describing how to follow workplace procedures. Consistent communication across different platforms and channels ensures everyone is well-informed and on the same page.
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• Champion work-life balance — Working from home can blur the lines between people’s professional and personal lives, and burnout is still very much a reality for remote workers. Training remote and hybrid employees to create and maintain boundaries can help your organization avoid losing people to disengagement and fatigue. 
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6. Focus on diversity, equity & inclusion (DEI)

Did you know DEI efforts can help recession-proof your company? According to recent research into the recession of 2007 to 2009, workplaces with a diverse workforce outperformed those without by 400%. 

Make your DEI strategies count with a holistic approach that strives to make inclusivity part of everything you do. In particular, do an in-depth audit of these areas:

• Company culture — Ensure employees belonging to underrepresented groups have dedicated channels and spaces to share their thoughts, feelings, and experiences regarding inclusion. A DEI survey is one approach among many to achieve this. But you should also ensure your company leadership has access to resources and training on ways to reduce unconscious bias and facilitate more inclusive work practices.
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• Pay and opportunity equity — Conduct a salary review, assess your training and incentive programs, audit your benefits packages, and study recent promotion data. Look for any disparities between team members that belong to underrepresented groups and their colleagues.
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• Recruitment — Source candidates from varied backgrounds with lived experiences that may differ from yours. For example, post open positions on sites specifically dedicated to BIPOC job seekers, and create an internship program for graduates from underrepresented groups. You should also encourage team members from diverse backgrounds to make hiring recommendations and refer candidates from their networks. 

7. Let employees with disabilities know about workplace accommodations

15% — or around one billion people — of the world’s population experience some form of disability. And thankfully, the expansion of remote work has opened up more opportunities for workers with health conditions or impairments.

But accommodations for people with disabilities aren’t a perk or a convenience — access to them is a legally protected right in most countries. 

And yet, many employees either don’t fully understand these rights or don’t take the initiative to investigate them. Some employers are even reluctant to provide this form of support. 

Don’t wait for employees with disabilities to ask for reasonable workplace accommodations, which is any support that helps them complete their tasks. Instead:

• Put an internal policy in place — Make sure it addresses how to talk to staff about their condition in a way that’s both sensitive and legally compliant. For example, in the US, it’s illegal for employers to ask a job candidate if they have a disability. So, your policy should discuss how conversations about accessibility can go, and specify which HR professionals are responsible for handling accommodations.
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• Let employees know how they can request an accommodation or alternative work arrangement — Create a standard operating procedure (SOP) for requesting an accommodation and make sure all staff knows where to access it.
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• ‍Follow up with the employee — Even after you approve an accommodation request, continue checking in with the team member to see if it’s been effective. Let them know you can always update their accommodation if their health or needs change.
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8. Conduct ‘stay’ interviews

‍Exit interviews can yield helpful data and insights that managers and HR professionals may not otherwise have access to, but they come at the unfortunate cost of losing staff. ‘Stay interviews,’ on the other hand, provide an opportunity for people to be honest about why they might leave or stay in their current role.

Managers should set up ‘stay’ interviews with their direct reports and ask:

• If you could change something about your job, what would it be?
• What makes you feel recognized and appreciated?
• What about your current position motivates you? What demotivates you?
• What do you enjoy most about working here? What do you enjoy least?
• What would prompt you to leave the company?
• What can I do to support you better? 
• Do you feel any of your skills have been undervalued, and if so, which ones?
• What kinds of training or learning opportunities would interest you?
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9. Give your employees resources for burnout prevention

At the beginning of The Great Attrition and Reshuffle, over a third of employees who left their jobs said it was because they felt their employers didn’t care about their well-being. If you want to establish a psychologically safe work environment for everyone at your company, prioritize addressing burnout preemptively and create a burnout protocol. 

HR professionals and team leads can work together to develop an informal procedure that tackles workplace stress and answers these questions:

• How can we allocate tasks in a way that prevents overwork?
• How will we monitor employee workload across the company?
• How will we monitor time off?
• How will we make sure employees take time off?
• What measures and actions will managers take to address burnout?
• Who should employees talk to when they feel overworked or depleted?
• What will you do when your employees report burnout?
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10. Update your personal time off (PTO) policies

Many companies’ PTO and sick leave policies adhere to outdated practices that, while still legal, aren’t convenient for the employees who use them.

For example, an organization may ask that staff provides a doctor’s note for any sick days. While this is not only inconvenient for the member of the team who’s unwell, it can also put others at risk of infection for teams that work together in office environments. Employees may come to work despite feeling poorly, which can not only make their colleagues sick but also prolong their own health and recovery due to a lack of rest. Requiring doctor’s notes for all sick days can also place an unnecessary burden on healthcare providers.

Before updating your policy, here’s what to take into account:

• What works for your employees. Review engagement survey feedback, talk to team members, and consider manager insights before re-drafting your policy.
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• The need for managerial approval. Decide the process managers will go through when approving or denying time off. For example, will there be a defined limit on how many people from the same department can be on vacation simultaneously?
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• The deadline for submitting a PTO request. How much advance notice do employees need to provide before taking time off? And what will you do in exceptional circumstances?
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• Whether all employees have the same PTO deadline. You may decide that managers need to put in PTO requests at least a month ahead of time to make sure someone will be able to cover their work while they’re gone.
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• Your sick day policy. Can employees ask for a sick day on the same day, or do they need to notify someone the night before? And can they take sick days if their kids or family members are ill?
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11. Expand childcare options

A 2021 survey found that over 50% of employees who are parents have a hard time finding childcare. So it should come as no surprise that offering staff more childcare options can increase retention by an astonishing 60%. Here’s how that can look in practice:

• Increase your parental leave options. This varies a great deal around the world, but research how much parental leave is legally required in your country or region. Then, make it your company benchmark to offer at least a couple of months on top of that.
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• Offer flexible spending accounts (FSAs). FSAs allow employees to pay for daycare or childcare expenses.
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• Provide childcare subsidies. Unlike an FSA, a subsidy lets you pay staff a non-taxable childcare allowance for each of their children.
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• Institute a backup childcare program. In cases where an employee’s childcare arrangement falls through, some companies may reserve places in nearby daycare centers for emergency use. They can also contract a third-party nanny or childcare agency to come to an employee’s home.
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12. Create a rewards program that actually benefits employees

A great employee rewards program is key to improving productivity, engagement, and, ultimately, retention. And your organization might already have a rewards program in place to reduce employee turnover and make people feel appreciated. You may, for example, offer a performance bonus or other financial incentives for meeting goals and milestones. 

But have you considered giving staff monetary rewards that aren’t based on performance? For instance: 

• Cover commuting costs. You could pay for your employees’ public transit fees or reimburse them for gas.
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• Profit-sharing. In a profit-sharing plan, companies regularly pay their people a certain percentage of their profits. While this depends on your organization’s profitability, it’s a great way to motivate and retain employees.
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• Holiday or scheduled bonuses. Employers may pay out bonuses to all staff around the winter or summer holidays to show their appreciation and cover higher expenses at those busy times of the year.
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• Stock options. Stock options give employees the opportunity to buy a certain number of company shares at a pre-set price, often at the time of hiring.
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13. Make transparency a core value

Transparency is central to building trust, and it’s especially paramount in the face of change. Unfortunately, a 2021 Gallup report revealed 74% of global employees believe corporate corruption is a pervasive problem. And only a third of working professionals agree their employers would never lie to their customers or withhold information.

People are asking for more honesty from their employers, and they want to feel leadership considers everyone in the organization before making major decisions. Here are some ways your company can live out a commitment to transparency with more intention:

• Always explain the reasoning or ‘why’ behind big decisions — Whether you’re changing your logo or declaring bankruptcy, giving the context behind a major move is essential to building employee confidence in your company.
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• ‍Be open to comments, questions, and constructive criticism — Let staff know how they can voice concerns as well as who they can reach out to with their feedback. And don’t just listen: follow up. Tell team members you’ve heard them and explain what you plan to do with their suggestions.
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• ‍Share regular updates and learnings with everyone — While it may not be the best channel to communicate more delicate matters, a weekly newsletter can be an effective way to relay regular news and company happenings.
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• ‍Maintain a central, easy-to-access repository of essential information — Employees should know exactly where to review policies, guidelines, and updates. For example, store your standard operating procedures (SOPs) in a shareable Google folder and link to it in your company intranet or project management software.
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14. Structure career paths

New hires and senior staff members alike want to know your company offers advancement and internal mobility options. They want assurance they won't stagnate in the first role they landed with your organization. But it’s not enough to show them your org chart and share job descriptions for every role in the company — give them the right steps to move forward.

The best way to accomplish this is by creating a competency framework that defines skills and expectations for each of your company’s seniority levels.

We designed our Competency Framework at Leapsome to integrate with:

• Performance reviews — Our Competency Framework helps managers identify where their reports need to improve. Then, they can tailor their feedback according to the skill level assigned to that employee and show them where they need to improve.
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• ‍Instant feedback — Managers can write comments based on how recent employee performance connects with framework skills. For example, if someone met their recruitment targets for a month, their team lead could comment with praise and give them a high rating on the “delivers results” skill.
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• Individual goals and OKRs — Our Competency Framework makes it easy to identify areas of growth and what personal objectives your direct reports should set for the quarter. 

Incentivize employee retention with Leapsome

While we’ve created this in-depth list of retention incentives for managers and HR professionals to consider, there are ultimately two factors that should influence what tactics you implement: employee needs and business priorities. 

That’s why, as a holistic people enablement platform, Leapsome offers customizable tools and workflows to create more resilient teams. With our platform, you can:

• Gather engagement data with surveys and build a culture of continuous feedback
• Run performance reviews focused on skills development and employee growth
• Align your entire organization with goals and OKRs‍
• Promote and compensate your employees based on objective internal data
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🔥 Build loyal teams who are proud of where they work

Leapsome combines tools for employee engagement, performance management, goal tracking, promotion, and compensation in one intelligent platform. 

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