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The Employee Benefits Management, Job Satisfaction & Employee Retention Model

The biggest challenge in organizations today is to retain talented employees. The rapid growth in the industries with high competition among the competitors, every organization tries to withhold their employees to get competitive advantages.

As we all know employees are the most valuable asset of the organization, the success, and failure depend upon how much they are satisfied with their work and organization.

The satisfying individual worker is the most difficult task facing most of the organization today. Also, there are numerous opportunities available for qualified human resources in the industry, making employers satisfy and retain them.

However, there is no single strategy or retention policy which may satisfy each and every employee in the organization due to different personalities, demands, and expectations of the employees.

The concept of employee satisfaction was pioneered by Hoppock in 1935 and defined as the “subjective reaction or satisfaction of employees with physical and psychological aspects of their work environment” Hoppock (1935, cited in [24], p. 10719).

Chang (2005, cited in [24], p. 10719) has a similar definition, “it is the feeling or attitude of employees toward their work environment”.

Wang (2005 cited in [24], p. 10719) mention both “employee satisfaction” and “job satisfaction” as the same.

As Hoppock mentioned, if the employees are satisfied with their job, their stay in the organization is most likely higher. This aligns with Herzberg’s two-factor theory (1968) and Maslow’s Hierarchy of needs (1943).

Both theories reflect on employee’s motivation and motivational factors. Therefore, to achieve employee job satisfaction, organizations have to invest in training and development to improve their knowledge and skills.

In addition, management has to allocate a reasonable pay or bonus based on employee performance to maintain their job satisfaction (Kehinde et al.,2012, cited in [5], p. 10).

Employee Benefits Management, Job Satisfaction & Retention

Herzberg’s (1987, cited in [31], p. 3) address the following condition to create job satisfaction among the employees by the managers; providing opportunities for achievement; recognizing workers contributions; creating work that is rewarding and that matches the abilities and talents of the employee; giving the maximum amount responsibility to every team member as possible; providing opportunities to advance within the company through internal promotions; giving coaching and development opportunities so individuals will pursue the positions they need at intervals the corporate.

The above model clearly illustrates the direct relationship between employee benefit management and job satisfaction leading employee retention.

If the employee benefit policies are well managed and organized in addressing the needs and demands of both the employees and organization, it will lead employees’ satisfaction towards the job, the organization and reduces employee turnover.

Thus the job satisfaction and turnover negatively correlated to one another.

The model also clearly defines the employee benefit factors exist in the organization will not only help to attract new employees but will lead to retaining the existing employees in the organization.

Satisfied with the job always results retain on the job or organization [20,22] and job satisfaction is the pleasure that the individual employee feels about his job or his work [6] (p. 3).


An employee base of an organization is complex and difficult to know it. Employees are the main asset for whom the organization depends. Retaining them will help the organizational growth in the long run and will also add their goodwill.

But the most challenging task for most of the organizations today is employee retention and their satisfaction. However, by taking into consideration the factors like rewards, salary, compensation, training & development, career development, recognition, employee engagement, appraisal system & superior support, etc.

Needless to say that these factors should be conducted by the HR professionals in order to understand the level and extent of the issue among the human resource of the organizations.

It can be concluded that opportunity for growth and promotion outside, compensation, working conditions, work timings/shifts, relationship with managers, location of the organization, opportunity to use kills and workload are the major reasons for employee turnover.

Further, management can control the attrition rate in the organization by keeping the selection process fair and transparent. If the manager makes himself more accessible to the employees they may continue to work in the organization.

Employees’ involvement in decision making enhances their self-esteem and encourages them to continue to work in the organization. Employees also value non-financial rewards they get, for example, recognition by the management for their performance.

A fair and transparent performance appraisal could be a major factor that influences the employees’ decision to either continue or quit the organization. Thus employee retention is a controllable factor and the management can make efforts to retain the employees.

Competing Interests

The author has declared that no competing interests exist.

Relationship between Employee Benefits Management and Employee Retention – Part 1

Relationship between Employee Benefits Management and Employee Retention – Part 3


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