Work-Life Balance Effect on Employee Retention

Abstract

Organizations look for strategies for increasing employee retention. The current paper is part of a research project on the effects of work-life balance (WLB) on employees’ turnover. It presents a literature review of the impacts of work-life balance on the retention of employees. It identifies job satisfaction as an indicator of retention of employees, which is related to WLB. Job satisfaction reduces turnover and absenteeism, which affects the productivity of an organization. On reviewing the literature, the paper advocates for WLB practices in the effort to facilitate retention of employees coupled with increasing their performance. This situation calls for organizations to implement flexible work structures and other strategies for reducing personal life work conflict.

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Introduction

Organizations have an immense responsibility to ensure that top talents are retained. Employee retention is deployed as a measure of performance in many organizations. Retention rates measure any decisions of workers to remain committed to the work of an organization. Companies that have poor employee retention policies experience high rates of employee turnover. Beecroft (2008) defines labor turnover as “the movement of people into and out of employment within an organization” (p.41). This claim implies that people can choose to move or remain working for an organization involuntarily or even voluntarily. Consequently, management cannot be blamed for failing to retain people within an organization in some circumstances. Employee turnover is controllable or unavoidable in some situations. Turnover comprises one of the major challenges that influence all organizations negatively.

The issue of attracting and retaining top talents comprises a major priority for small, medium, and large organizations. Retaining employees determine the competitive advantage of an organization through the increased productivity and management of customer relationships. Employee turnover increases the cost of recruitment and training of new employees to fill gaps that are left by the outgoing employees. Studies on employee turnover present it as one of the issues that organizations that seek to exploit cost competitiveness as a strategy for success should address proactively. Considering the negative effects of high labor turnover, many organizations look for strategies for increasing employee retention levels. Work-life balance may constitute a mechanism for increasing employee retention. This paper presents a literature review on whether work-life balance (WLB) has any impact on employee retention.

Literature Review

Employee Retention

Retention refers to the maintenance of a work environment that supports the current employees to continue working for an organization. Various factors influence employees’ decisions to remain in an organization. However, different factors may have different effects, depending on the industry in which an organization operates. In the healthcare industry, Jones (2009) claims that the issue of recruitment and subsequent retention of nurses is influenced by factors such as earnings, the reputation of the health facility, the nature and status of unions, and job independence. From the paradigms of the factors that may influence the decisions of a given nurse to stay at a given facility, retention of nurses may be influenced by factors such as recognition and inclusion of an individual nurse in the decision-making process within a health facility. The nature of the workload and the interrelations of a nurse with fellow workers within the departments and even the entire organization also determine turnover rates in the nursing profession (Jones 2009).

Despite the discussion of the above factors by Jones (2009) in the context of hospital settings, they also apply to other disciplines such as human capital management and human resource management as essential factors, which enhance worker motivation. For example, Erskine (2012) asserts that workforce motivation is an essential element in any organization that seeks to use employee talent potential to yield success. Indeed, the department of human resources within an organization is established to ensure that an organization recruits the most productive workforce, remunerates them accordingly, and/or resolves conflicts between employees and/or with the business. The department also presents work concerns from employees before the organizational management and administrative teams. It ensures that employees remain committed to the business of the organization in a bid to foster their retention (Brockbank, 2007).

Recruitment and retention overwrap. In the nursing sector, Sourdif (2008) confirms this assertion by revealing how the concerns of the recruited nurses overlap with the decisions to remain employed. Carlson (2015) says that factors, which encourage registered nurses to join a health facility and their subsequent desire to remain in the employment, need to be given central consideration by any organization that wishes to attract and retain sufficient nursing staff officials. It is important to conduct a thorough scrutiny of employees before they are recruited into an organization in the attempt to find whether they will be retained and motivated while working under the existing working conditions within an organization. However, it is important to note that recruitment is an expensive affair. For example, Jones (2009) approximates that it requires about $62,100 to replace an existing registered nurse within a health facility. This cost immense, especially by noting that a single turnover of one employee creates a vacuum in terms of workload, which must be taken up by other employees.

From the perspective of human resource management, increasing the workload implies that employees who are left when their workmates leave are likely to be lowlily motivated due to the increased responsibilities, which they consider unfair. This situation may create imbalances between the employees’ life outside work and the job itself. DiMeglio and Piatek (2010) find a single turnover as having the capacity to lead to multiple turnovers due to work-life imbalances of the remaining employees. The only most practical way to deal with this self-replicating problem is to seek mechanisms for employee retention. The realization of the need to retain employees within an organization prompts management scholars to explore various theories that can provide a guide on how to accomplish the task. Some of the ways that are associated with the organizational theory include fostering motivation, mentoring, and even choosing a balance between employees’ life and work. Since this paper only deals with work-life balance, a discussion of the other factors is not warranted.

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Work-Life Balance

Inflexible work environments may increase employee decisions to leave an organization voluntarily. The changing workforce demographics lead to changes in people’s preferences for different jobs. For example, Moen, Kelly, and Huang (2008) observe Merrill’s 2005 survey that indicated how 16% of all baby-boomers sort part-time jobs. 42% of the studied baby-boomers preferred jobs that allowed time for leisure. This observation suggests an emerging workforce that values organizations, which provide flexible jobs to permit them to take charge of other equally important life aspects. In 2007 PEW research, 50% of all working mothers noted their full commitment to executing domestic chores while ensuring that they contributed to the family income kitty (Harzing & Pinnington, 2011). Such women preferred working on a part-time basis.

Although implementing flexible work policies to meet the needs of all people is impossible, the concept of work-life balance about its increasing effects on an organization’s capacity to retain employees attracts striking compromises. Organizations need to determine whether to lose their talented employees who look for flexible jobs to their competitors or retain them by ensuring a good work-life balance. Implementing good work-life balance structures requires organizations to develop policies for balancing professional and personal responsibilities of their employees. The necessity for such policies is clear upon considering the relationship between work-life balance and employee retention.

Relationship between Work-Life Balance and Employee Retention

Turnover and the intention of turnover are common, especially amongst recruits. Beecroft (2008) asserts that the turnover rate among first-year nurses is in the range of 35 to 60 percent in the US. Cognition of these outstanding rates calls for the deployment of imperative and effective employee retention strategies. Beecroft (2008) explains the causes of high turnover among recruits as being instigated by delegations of responsibilities to recruits, yet the people do not have the required experience. Delegating responsibilities to employees who have no experience makes them utilize excessive time in work-related chores at the expense of their personal life.

Although delegation constitutes an important strategy for increasing employee motivation as a way of reducing turnover, it fails to work well in situations that involve a new workforce due to work pressures while operating in unfamiliar environments. Chu and Price (2007) offer evidence that attitudes and work pressure incredibly influence employees in healthcare settings in the context of their job satisfaction and their commitment to organizations. Meeting high work pressures compels employees to neglect their life aspects at the expense of meeting their professional responsibilities.

A growing body of literature investigates the causes of employee turnover. Sourdif (2008) identifies communication, inspiration, delegation, and unsafe work environments as important causes of turnover intents. Amid the significance of these aspects, Lockwood (2010) asserts that work-life balance strategies are rarely emphasized in employee retention theories. This claim implies that supervisors in some organizations lack the cognition that they can also play a role in increasing organizational productivity through organizational commitment or reducing work absenteeism. Quoting a 2009 research that was published in the Journal of Training and Development, Lockwood (2010) says that 69% of total absenteeism in organizations occurs when employees skip work to attend to their personal needs, rather than because of sickness. This claim suggests the need to ensure that the work provides a room for employees to attend their personal needs. Employee absenteeism correlates negatively with organizational productivity. Organizations do not plan to replace vacant positions that are left when employees skip work. Absenteeism is important in establishing a link between work-life balance and retention since it encompasses a short-term form of employee retention.

Richman, Civian, Shannon, Hill, and Brennan (2008) study the relationship between flexible workplace and policies that seek to enhance work-life balance together with employee retention intentions. The researcher finds a direct relationship between work-life balance policies coupled with employee engagement and employee retention intentions. Consistent with the work of Richman et al. (2008), employees consider flexible work policies an important aspect of facilitating a good work-life balance, which is an important determinant of employee retention intentions. For example, as Kramar and Syed (2012) reckon, employees report how to wok flexibility influences their decisions for joining organizations they work for, job satisfaction levels, and their plans to remain working for the organizations. Indeed, organizations’ leaders now recognize the importance of a flexible work environment as an important policy framework for enhancing work-life balance in a bid to increase their employee retention rates (Hayman, 2009).

Job satisfaction constitutes an important factor that determines the intentions of employees to continue working for an organization. Cegarra-Leiva, Sanchez-Vidal, and Cegarra-Navaro (2012) assert that the factor encompasses a parameter for work-life balance. This claim suggests that work-life balance policies that seek to enhance employee job satisfaction also correlate directly with employee retention. Job satisfaction is among the most investigated subjects in the field of institutional workforce management. Research on job satisfaction provides amicable evidence that occupational fulfillment is not only crucial for the employees, but also the organizations’ performance and success in terms of productivity. Therefore, policies that enhance a good work-life balance are also important for organizations, especially upon recognizing that job satisfaction correlates with work-life balance policies.

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Work-life balance influences retention in large, medium-sized, and SMEs. Cegarra-Leiva et al. (2012) define work-life balance as “the ‘individual’s ability, irrespective of age and gender, to find a life rhythm that allows people to combine their work with other responsibilities, activities, or aspirations” (p.92). In case of failure of employees to discover the balance between professional responsibilities and their personal life, personality conflicts arise. Work-life balance literature defines the conflict as a crush of work and family roles. The conflicts arise from incompatible pressures that are exposed by work and family roles (Moen et al., 2008).

In the effort to minimize work-life balance conflicts, organizations introduce policies that seek to improve employees’ working experience by balancing their personal life and work demands. The objective of such policies entails permitting employees to have a quality life through their devotion to conducting different activities outside the work environment. Hughes and Bozionelos (2007) identify such activities as increasing employee education skills, participating in social life, and leisure among others. Cegarra-Leiva et al. (2012) assert that employees may leave their jobs to attend to personal matters such as maternity, additional training, and/or taking a break from monotonous work. This situation implies that where an organization does not provide a room for employees who seek time to attend to these issues among others, workers will likely consider leaving it. Guided by these concerns, organizations implement flexible job policies such as allowing telecommuting, videoconferencing, offering recreational jobs, and reducing their job duration (Cegarra-Leiva et al., 2012).

Organizations encounter the challenge of retaining employees as one of the major strategies of workforce management. Addressing this challenge is essential to enhance competitive advantage (Harzing & Pinnington, 2011). In this effort, the satisfaction of employees through WLB is essential. Without the creation and maintenance of programs for WLB, organizations are exposed to the risk of employee conflict. This conflict entails family roles and interference with work-life issues, which create challenges or tensions for employees to operate smoothly. Such conflicts create inconsistencies between individual life and family life. Personal conflicts that relate to WLB challenges within an organization create organizational and workforce psychological distress, which increases turnover intentions (Harzing & Pinnington, 2011).

Lewis and others, as discussed by Kramar and Syed (2012), study WLB by conducting interviews with participants from Japan, South Africa, and India. Lewis says that the new economy emphasizes work intensification as an emerging global phenomenon (Kramar & Syed, 2012). This observation suggests that working for long hours equates to employee commitment to an organization. For instance, one of the participants from South Africa informed Lewis and others that working for long hours meant that one effectively contributed to creating organizational differences (Kramar & Syed, 2012). According to the researchers, a management consultant in India also asserted that working for long hours “had become so entrenched…especially in the new economy…we have got to work hard and…literally give up our personal lives” (Kramar & Syed, 2012, p.388). This scenario creates a personal-life conflict.

Japan echoes a similar concern that has resulted in a work-life imbalance. The nation is also working on mechanisms for engaging men in domestic and childcare work. However, the concern remains that men dominate full-time jobs while women dominate part-time jobs such that they (women) do not gain from the benefits that are associated with full-time jobs. As Lockwood (2010) observes, more women than men prefer part-time jobs such that they can attend to their domestic responsibilities. Where an organization does not offer flexible jobs to such women, they are likely to have lower retention levels.

From the above discussions, the growing scholarly consensus reveals that WLB practices are significant in enhancing organizational performance. For instance, in empirical research that seeks to relate WLB and variables of job characteristics, Hayman (2009) finds how flexible work schedules have a direct relationship with individual life balance. The study finds that providing flexible work schedules plays a central role in integrating individual life with work and family life. The applicability of Hayman’s (2009) findings to all organizations has limitations. The study only draws 56 percent of its participants from administrative staff in a single university. The variables that are used in the study are also not exhaustive. This observation means that some essential variables, which may contribute to the found relationships, may not have been reflected in the results of the empirical study. Nevertheless, work-life balance is an important determinant of employee retention levels in an organization.

Conclusion

To compete with other organizations, operational efficiency is important. The efficiency cannot be achieved with conflicts between work and employees’ personal lives. The literature on work-life balance emphasizes the need for increasing people’s productivity by ensuring a good fit between work and their personal lives. This situation opposes the approach to increasing working hours as a mechanism for increasing employee productivity. From a wide body of literature on WLB, the paper claims that WLB is necessary to induce worker motivation and job satisfaction as important pre-determinants of turnover and employee retention. The benefits of the direct relationship between WLB and retention are important to both employees and organizations. In the developing or emerging economies, the prevalence of exploitation of employees to increase organizational productivity still prevails. This approach not only wears them out to the extent of leading to burnout but also establishes conflicts between work and the employees’ personal life, which may lead to high labor turnover. Organizations can overcome the problems of labor turnover by establishing policies for increasing their employee work-life balance.

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Reference List

Beecroft, D. (2008). Turnover Intention in New Graduate Nurses: A multivariate analysis. Journal of Advanced Nursing, 62(5), 41-52.

Brockbank, W. (2007). If HR Were Really Strategically Proactive: Present and Future Directions in HR’s Contribution to Competitive Advantage. Human Resource Management, 38(4), 337-352.

Carlson, J. (2015). Factors Influencing Retention among Part Time Clinical Nursing Faculty. Nursing Education, 36(1), 42-45.

Cegarra-Leiva, D., Sanchez-Vidal, E., & Cegarra-Navaro, G. (2012). Work-Life Balance and Retention of Managers in Spanish SMEs. The International Journal of Human Resource Management, 23(1), 91-108.

Chu, H & Price, L. (2007). Job satisfaction of hospital nurses: An empirical test of a causal model in Taiwan. International Nursing Review, 50(11), 176-182.

DiMeglio, P., & Piatek, C. (2010). Group cohesion and nurse satisfaction: Examination of a team building approach. Journal of Nursing Administration, 35(3), 110-120.

Erskine, M. (2012). Human Capital Management. Management Services, 1(1), 12-13.

Harzing, A., & Pinnington, A. (2011). International Human Resource Management. London: Sage Publishers.

Hayman, J. (2009). Flexible work arrangements: exploring the linkages between perceived usability of flexible work schedules and work/life balance. Community, Work & Family, 12(3), 327-338.

Hughes, J., & Bozionelos, N. (2007). Work-Life Balance as Source of Job Dissatisfaction and Withdrawal Attitudes: An Exploratory Study on the Views of Male Workers. Personnel Review, 36(1), 145–154.

Jones, B. (2009). The Cost of Nurse Turnover. Journal of Nursing Administration, 35(1), 41-49.

Kramar, R., & Syed, J. (2012). Human Resource Management in a Global Context. London: Palgrave Macmillan.

Lockwood, N. (2010). Work-Life Initiatives Impact Employee Retention. HR Magazine, 48(6), 29-30,

Moen, P., Kelly, E., & Huang, R. (2008). Fit Inside the Work-Family Black Box: Ecology of the Life Course, Cycles of Control Reframing. Journal of Occupational and Organizational Psychology, 81(3), 411–433.

Richman, A., Civian, J., Shannon, L., Hill, J., & Brennan, R. (2008). The relationship of perceived flexibility, supportive work-life policies, and use of formal flexible arrangements and occasional flexibility to employee engagement and expected retention. Community, Work and Family, 11(2), 183-197.

Sourdif, J. (2008). Predictors of nurses’ intent to stay at work in a university health center. Nursing and Health Sciences, 12(6), 59-68.

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