Employee retention: what tools can you use to boost employee loyalty?

In these times of war for talent, finding qualified employees has become a challenge. Against a backdrop of increasing competition in the labour market, retaining those employees once they have been hired has become a strategic priority.

Certain labour law tools can help achieve this objective. Here you'll find an overview of some of them.

(Intelligent) remuneration to build loyalty

Attractive, tailor-made remuneration packages

Attractive remuneration is an effective loyalty-building tool. Numerous salary packages now include (in addition to the fixed salary) a variable salary and various benefits (car or other mobility solution, meal and eco-vouchers, various insurances, mobile phone with subscription, etc.). Many companies are also moving towards ‘cafeteria plan’ type solutions, giving employees greater choice in the composition of their remuneration.

Well thought-out variable pay can also help to retain employees.

Well thought-out variable pay can also help to retain employees.

It is possible to include a ‘presence’ clause in the employment contract or bonus plan: payment of the bonus is thus conditional on the employee still being in service at the end of the reference period (generally the calendar year), or even on the date of payment of the bonus (generally March or April of the following year). Without such a clause, the employee is in theory entitled to a pro rata temporis payment at the time of departure.

Spreading the payment of bonuses over time can increase this retention effect: in such a scenario, part of the annual bonus is deferred (e.g. 25% of the annual bonus payable after 3 years). The employee is thus encouraged to remain in service to receive the balance of his or her bonus. If this mechanism is applied to the bonus granted each year, a recurring loyalty effect is created.

This approach can be further developed: while many bonus plans reward the achievement of objectives over a one-year period, there is nothing to prevent this timeframe being extended by providing for objectives to be achieved over several years (typically 3 years). The employee is encouraged to stay in order to receive the bonus at the end of this period. In this case, the bonus is not spread over time, but depends on the achievement of targets over several years.

Training to build loyalty

With a shortage of skilled labour, many companies are investing in employee training. This can be a substantial investment.

In fact, many (young) employees see training as a real added value for their careers. Offering such training (independently of legal obligations in this area) is in itself an important factor in attracting employees.

When a training course represents at least 80 hours or costs at least twice the average guaranteed minimum income (i.e. around EUR 4,150), it is possible to link the training to a tuition clause. This tool, which is rarely used in practice, makes it possible to demand repayment of part of the cost of the training from an employee who leaves the company (resignation without serious reason or dismissal for serious reason) within 3 years of the end of the training or the award of the diploma. This repayment obligation, which must be degressive, creates an additional retention effect: the employee is thus encouraged to stay with the company for at least 3 years after completing the training.

Policy adapted to the company

The examples above are just some of the tools available. A human resources policy focused on employees and their well-being, and the creation of a strong sense of identification with the company, are also powerful loyalty-building tools. All in all, the key is to implement tools and policies that are tailored to the company, the profiles it is looking for and its size. There is no miracle solution to building staff loyalty, but a whole range of complementary options.