No raises this year? Secrets to employee retention in difficult times

Dr. Rhonda Savage

Around the world, employers and employees alike are still struggling.

Many are flat in growth or have declined, and employers are faced with these tough choices:

• Lay off employees or cut hours
• Decrease benefits
• Reduce pay
• Freeze salaries

By far, the most appealing of the four is freezing salaries. The problem is, no hard working employee wants to hear these words “times are tough…no raises this year.” The question is, how do you keep employees happy and productive during tough times? In addition, key employees may have the opportunity to move to another company. How do you retain, challenge and motivate these key people to stay with you during the hard times?

Pay and benefits are not the number one motivational factor for employees.

While important, most rank the need for praise and appreciation the highest, closely followed by the need to belong to a close-knit team. Team members also need to have responsibility and feel like their voice matters in an organization.

Use the following tips to keep employees happy, employee turnover down and productivity up, despite “no raises this year”: 

Look towards the future

Ask your employees what skills or training you can give them to better do their jobs, and help them set short-term personal goals that are business-oriented. Work with your employees to outline the steps necessary to accomplish the goals, and provide encouragement and guidance throughout the process. This gives employees a sense of pride and responsibility for the future success of the company, and will motivate them to help the company get through tough economic times.

Have efficient systems in place for accomplishing tasks

If team members don’t fully understand how to get things done, morale will go down. Work on systems like team training, follow-up calls with clients, collections, stocking and ordering, and letters to clients. Focus on improving communication and customer service. Train your employees on the behind the scenes duties that are critical to a well run business.

Hold regular staff meetings

Staff meetings improve communication, goal setting and accountability. Through team meetings, you can keep your staff informed, motivated and involved. This forum gives staff members the opportunity to discuss the problems they are having or any concerns they have about the company, allowing leadership to solve small issues before they turn into bigger ones. When employees feel their contributions are valued, they will have a higher tendency to stay with an organization, even if times are tough.

Be a good leader

What employees want from leadership is that you’re fair, consistent and apply the same office policy to everyone. Make decisions and stick to them. Avoid wavering, but know that if you and your team try something and it doesn’t work, it’s okay to change it. When you make a decision and stick with it, not everyone will agree, but they’ll respect you for making a decision and moving forward with it.

Promote a positive work environment

As a leader, if you consistently have a positive attitude in the office, employees will mirror that attitude. If you sense gossip or issues among team members, take steps to resolve these things before they become an issue. Acknowledging and rewarding team members for accomplishing goals can also contribute to a positive environment. When employees feel appreciated, they are happy and motivated to continue doing a great job.

Be sure each employee has a copy of the office policy manual

Be sure the manual is current and that you stick to the guidelines. If team members learn and understand the office guidelines upfront, they are less likely to break the rules, resulting in less conflict between leadership and the team member.

Do things with your team outside office hours

Scheduling regular outings with team members outside of the office improves morale and encourages friendship between employees. In addition, respect increases between your team members. When team members get along, they work together better and are more productive.

Involve your team in the decision-making process

Gather input and ask questions, but as the leader, you should make the final decisions, even if you have an “office manager” or “practice administrator” on the team. Involving your team in this process helps show that you value their opinions, giving them a sense of pride.

Most importantly, as a leader, stay positive at all times

Make the changes that are needed and be the leader that your staff needs. Speak in positive terms about the company, its leadership and the colleagues who are not in the room. Say thank you more often. When something does go wrong, work through the issue and encourage everyone to move on. Acknowledge people who are accomplishing their goals and encourage those who are not. Show interest and get excited about your employees, your business and the future. 

In this economy, encouraging employees to work harder, quicker and more efficiently can be difficult without being able to offer raises. An overworked employee can easily become resentful, negative and walk away, which will affect the rest of your staff. Following these guidelines will help you keep your staff happy, motivated and productive, ultimately helping your business come out of the recession on top! 

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Reprinted with the permission of , an internationally acclaimed speaker and CEO for a well-known practice management and consulting business. Dr. Savage is a noted motivational speaker on leadership, women's issues and communication. For more information, visit www.DentalManagementU.com or e-mail [email protected].