Should You Reward Managers With Low Turnover?

I know, you look at this one and automatically say, "of course"!!  After all, low turnover is good, high turnover is bad.

On second thought, maybe rewarding low turnover isn't such a great idea.

I was prompted to pop a post on this topic because of a line I saw in the whitepaper recently released by The Workforce Institute on the role of Front-line Managers in retaining hourly workers.  Here's Action Item #2 from the paper:

"Action Item #2 - Penalize or move managers who generate excessive turnover"

Now, I'm going to agree with part of that statement - you should find a solution for the manager who is clearly generating excessive turnover over time due to his or her style, issues, etc.  If you can't coach them up, or develop them, then you probably need to get them out of that role.

But penalize managers/departments who generate light turnover?  That sounds like you are ready to reward managers with low turnover.  That's the wrong way to go, and here's why:

1.  All Turnover is not created equal.  Some is good, some is bad.

2.  Low Turnover doesn't mean your employees are engaged, care about your mission, or are contributing to the cause...

3.  Penalizing or rewarding turnover stats is a sure way to make managers manage the stats rather than their teams.

4.  When managers try to appease employees who shouldn't be driving the agenda, guess what happens?  Your best employees see it, get appalled, and start looking for other gigs,  which means the turnover you do have may be the worst possible kind - your stars leaving you....

Those are my reasons not to penalize or reward based on turnover stats.  I'm all for managing someone who has a problem, but systematically rewarding or penalizing based on voluntary turnover? 

That's an agenda that has a lot of holes....