Finding good employees has never been an easy task. And in times of economic boon with low unemployment the task becomes even harder. But there is an even more difficult task - keeping good employees. Believe it or not, there are some basic incentives that you can implement to keep your staff in tact, and most of them cost money. The key to balancing costs is to insure the added expense results in increased productivity and employee retention.

Perhaps, the most important factor in keeping a good employee is your management style. Yes, that's right. How many times have you heard the story of someone who was making good money, but decided to leave for a lesser paying or less secure job, or one that required greater travel time and less job responsibility? For all the good things a company has to offer, an authoritarian, disrespectful, harassing style of leadership simply scares away good employees. On the other hand, team work, opportunity for input and praise for a job well done can increase loyalty, especially in times of company financial hardships.

Another basic incentive is the provision of a health insurance program for all full-time employees. Yes, it does cost money, but provides one of the most attractive financial incentives in a day and age when health care costs are rising at significant rates. It used to be that the inclusion of dental, eye and life policies were so important to compete for good employees. Though still quite attractive, the provision of health care remains the most critical offering.

The healthcare program cost cannot be ignored. According to a recent Dunn & Bradstreet survey, employers with 50 or less employees are experiencing price hikes averaging 13%. But there are alternatives to keep those costs down. Area Development Online provides cost reduction alternatives that include the following:

• Join forces with other employers or groups of employers. Larger number of employees under one policy can increase the leverage to negotiate a lower premium.

• Have employees accept a higher share of the premium cost and/or a higher deductible. Explaining the need to control costs to your employees will likely result in understanding and their support for such a move.

• Provide employees with a menu of health coverage services. For example, they may want to eliminate the office visit and keep emergency care services. If spouse or significant other also have health coverage this allows more leverage and less cost to you and your employee.

Other incentives can be instituted based on length of employment, excellent periodic employment appraisals and excellent performance related to special projects. Some of those incentives include:

• A day off, with pay, above and beyond regular paid vacation and sick leave.

• A bonus above and beyond regular compensation and benefits.

• A reduced scale in the number of years of continuous employment as regards the number of paid vacation days annually. For example, instead of extending annual paid vacation days from 10 to 15 at the end of five years, reduce the continuous employment cap to 4 years.

When considering the alternative incentives you want to insure all employees are included. For example, if you offer bonuses above normal commission to the sales staff, what will be an incentive for the clerical help?

I have a good friend who is very accomplished as Executive Vice President for a well-known, international firm. He supervises hundreds of employees locally and supervises the opening of plants worldwide. We recently had a conversation about the idea of providing rewards to individuals considered "key" employees to the success of a company. He confirmed my belief in that any company insisting on treating certain employees with better financial and working conditions than others can only serve to alienate the workforce. If you provide a competitive compensation and benefits package with incentives consistent across the entire workforce there should be no need to fear losing a good employee. Good management, competitive compensation and benefits, a good work environment and equitable treatment of the workforce encourages loyalty, high morale and low employee turnover.

His belief was that any employee who considers him/herself "key", and is treated as such could only create the potential for disharmony, low morale and loss of good personnel. If the company clearly demonstrates loyalty to the staff, the same should be expected in return from the employees.

The last 30+ years have witnessed a dramatic decline in mutual employer-employee loyalty due to layoffs, closures and acquisitions. A small business in the financial position to do so, can harness that loyalty, high productivity and low employee turnover. However, be consistent with your incentives and be certain the added costs incurred do not disrupt profitability.

© 2000, Carroll Stephen Windhaus