The Power of Know

Cost of Employee Turnover

Designed to show what the costs are related to a departing employee and those associated with filling the vacancy. It is interactive to allow users to input data specific to the organization and individual/position being evaluated while providing embedded, protected formulae that will compute the results of the user-entered data.

Cost of Employee Turnover Calculator

Cost of Employee Turnover Calculator

SECTION 1--Departing Employee Costs To Last Day

This Section is designed to show what your organization has invested for salary and benefits up to the last day of your departing/departed employee
Enter the total of wages (non-benefit) paid to the employee up to and including their last day. his may include PTO pay-out, bonus, commissions and/or other monies paid or to be paid to the employee as wages
Enter the actual or average percentage your organization’s benefit contributions represent related to the departing employee. Please use the decimal version of your percentage. For example: for 28%, please type 0.28.

The embedded formula will calculate the organization’s dollar expenditures on the departing employee’s behalf as a percentage of the wages paid through the last employment day

The embedded formula calculates the costs to the organization paid to the last day of employment that includes wages and company-paid benefits you’ve spent on this employee and that investment is “walking out the door”.
This is an optional feature that has value in determining if there is a continual turnover of individuals in this same job class. It could be indicative of a number of internal and/or external factors that could include not hiring qualified individuals in to the vacancies, poor supervisory/management practices, poor training, unhappiness with wages, benefits, etc. Trends can be determined by tracking this information and as necessary, conducting an analysis into the reasons behind the departures. Exit interviews may be one way to capture the reasons behind why people are leaving certain job classes.

SECTION 2--"Hard" Costs of Recruitment/Filling Vacancy

This section is designed to show the basic costs of recruiting to fill the vacancy.
Enter the total of dollars spent/anticipated to be spent on placing job ads, attending job fairs, producing “applicant packets”, etc. This amount represents actual dollars expended on finding applicants to consider in filling the vacancy.
Enter the amount of sign-on bonus that may be considered, offered/paid to the candidate selected for the position
You will need to determine who is involved in filling the vacancy and then calculate the average hourly rate (including exempt and non-exempt individuals involved) paid for all staff involved in filling the vacancy. This figure may change for each vacancy based on the level of the vacancy and staff involved in the filling the vacancy.
You will need to determine how many hours—or the average from experience---your organization will devote to this recruitment effort from start to the new employee’s first day. This figure may change based on the position to be filled.

The embedded formula will calculate the organization’s staff costs to fill the vacancy based on the average hourly rate paid to those involved times the average number of hours to fill the vacancy.
Determine the actual or average costs of having the potential new hire undergo a drug and/or other screening tests and if outsourced, the costs for conducting background and reference checks. Include these costs in the number of hours devoted to filling the vacancy if done in-house.

The embedded formula will calculate the total costs identified in Section 2.

SECTION 3: New Employee Orientation Costs

This Section is designed to identify the costs of preparing your new employee to fit in to your organization’s culture in preparation for becoming a “productive employee”
Enter the number of hours of attendance your new employee will be required to attend once hired.
Enter the hourly rate paid to any in house or contracted trainer. If more than one trainer is involved, enter the total OR average hourly rates of all involved trainers.

The embedded formula calculates the entered data to provide the costs to conduct the New Employee Orientation.
Enter the hourly pay rate (exempt or non-exempt) for the newly hired employee attending the New Employee Orientation program.

The embedded formula will calculate the number of hours of NEO attendance times the hourly rate for your new employee.

The results of the above-entered data is calculated by the embedded formula to provide a total cost of providing the New Employee Orientation and the new employee’s attendance.

SECTION 4 : Costs of Turn-over: Recruiting and Orientation Total Cost

This Section is designed to provide the total costs of (a) conducting the recruiting and (b) facilitator and new employee’s costs to the organization to attend the Orientation program.

The embedded formula draws from the total provided in Section 2, “Hard” Cost to Fill Vacancy

The embedded formula draws from the total provided in Section 3, Total NEO Costs

The embedded formula totals the figures provided from the above two cells