It would be easy to think that when an employee leaves your farm, at least you are saving a few dollars on the payroll. Actually, various studies have shown that you will probably incur costs to the business equal to 30 to 150% of that person's pay. The payroll is lower, but shuffling staff to cover the opening, the hiring process and training time all hurt productivity on the farm and may incur some actual costs for overtime, advertising, etc. This means that retaining good employees not only makes life easier, it saves money.
Employee retention is not often given a lot of thought on dairy farms, but it deserves attention. Employees are what make many dairy farms successful today. A good manager can't do it all alone; he/she needs the right people to do the work in the business plan. Retaining good employees also reflects well on the farm as a well-managed business where people want to work. You are an employer of choice.
A 1999 Cornell University study found three factors that were important to employees' job satisfaction and eventual retention:
- Good wroking conditions
- Good wages
- Job security
Good working conditions include reasonable employee comfort, a pleasant atmosphere in which to work, and equipment that is in good repair and ready for work. These items help the workforce be productive and show them that the employer cares about their safety and well-being.
Working conditions may also include reasonable working hours, scheduling flexibility that allows for employee participation in family events, school activities, vacation, etc. Farms need workers every day of the week, but that doesn't have to mean the same people always have the calendar weekend off. Consider schedules that might give some employees a Friday/Saturday weekend and others a Sunday/Monday weekend, or some other variations to be sure you always have enough of the right staff on hand. The size of your farm and your staff will have a major impact on how you work this part of your staff plan. Remember, overtime pay at 1½ normal pay is due employees working over 48 hours per week. Salaried staff might be exempt from overtime, depending on their normal salary amount.
Good compensation doesn't necessarily have to be the highest pay rate in the area, but it does need to include a fair and competitive pay rate and may well include some extra benefits. You need to remember your competitive market isn't just other dairy farms. If you employ relatively unskilled and entry level people, you probably need to see what is being paid at the local convenience stores and other small businesses hiring similar people. If you are hiring people capable of bearing some management responsibility, you'll probably want to look at supervisors at other industries in the area and perhaps positions in trades where people have some level of extra training.