The Role of Employee Wellbeing in Retention: Tips for HR

Posted on 24 January 2025
(Updated 4 February 2025)
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It’s estimated that the average person will spend one third of their life at work, and so it only follows that when something consumes so much of our time it will inevitably play a pivotal role in our overall health and wellbeing. The vast majority of people professionals are already well aware of the role of employee wellbeing in retention, but many are still unsure of what wellbeing practices would best work for their specific organisation’s culture, goals and challenges.

There is also the question of getting leadership buy-in. With budgets under intense pressure, justifying the cost and resource that goes into employee wellbeing efforts is crucial. In the following article, we explore research-backed methods for nurturing employee wellbeing and how they have been tangibly linked to improved employee retention.

First, what is employee wellbeing?

Wellbeing is a concept that will always come with some level of subjectivity, based on individual experiences, culture, and even legal definitions in certain situations.

The broad definition proposed by the University of Oxford’s Measuring Workplace Wellbeing paper encompasses three main points:

  • Evaluative job satisfaction
  • The affective or emotional experience of work
  • How meaningful and purposeful work activities are

Additionally, in the largest study of its kind to date, the Wellbeing Research Centre surveyed 46,336 workers in 233 UK organisations found there was no evidence that individual-level mental health interventions such as mindfulness, relaxation classes, and wellbeing apps benefit employees.

Instead, it was changes that took place organisationally – such as working model flexibility, management practices, and performance reviews – which were far more likely to improve employee wellbeing.

How You Can Improve Employee Wellbeing

Line Manager Training

According to research, only 25% of HR professionals believe that managers in their organisations are equipped to spot early signs of mental ill-health. When this is viewed with the context that mental illness costs UK businesses £51 billion each year, there is clear ROI for leadership to back HR’s investment in training line managers so they have the knowledge to flag potential issues early on and point employees towards the right support.

Numerous in-person and virtual courses are available, whether you choose to have your managers become qualified as Mental Health First Aiders or just generally become more confident in their ability to offer initial support to their team members.

Managers contribution goes beyond their specific understanding of mental health issues though – it’s also about how the conduct themselves in the day-to-day. Managers have a massive impact on the retention of your people – research by Unmind found 75% of people had either left a job or considered leaving due to a bad manager.

Whether it’s conscious or not, it’s imperative that managers are an example of professional behaviour and have the skills to mentor their team members. People teams will massively benefit from robust data and analytics tools that enable them to spot issues early on, such as through their team showcasing higher than average attrition, low performance, or reporting poor states on wellbeing on internal surveys.

The is no one-size fits all solution. Some managers may benefit from being partnered with high performing, more experienced managers to they can be mentored on best practices. HR may also find it useful to speak with the team members to better understand the exact areas their manager struggles with so the right training and processes can be put in place.

Flexibility

In a recent People Management poll, 77% of employees claimed flexible working is more important to them when considering a new role than a pay rise. Meanwhile, The Boston University School of Public Health found those with greater job flexibility were 13 percent less likely to experience daily anxiety. Anxiety has been linked to heart disease, insomnia, and other concerning health issues.

With statistics like these in mind, the case for introducing greater flexibility in the workplace to boost health and retention is strong.

A successful flexible working policy will take into account that different employees will have their own requirements and preferences. Working parents may opt to utilise it most over the school holiday periods, those who are more productive in-home environments or who have disabilities that make commuting difficult may utilise it to go hybrid – it will likely vary.

The details of your policy will inevitably be determined by the type of work your organisation does. What will be crucial is seeking feedback from employees while you draw up your policy so that you can best understand what they feel would impact their wellbeing the most.

An HR system that not only centralises any flexible working information for employees to easily access, but that also is flexible itself is non-negotiable. Flexible working has risen in popularity as many other cultural shifts take place in the workplace, and so having a platform that can morph and evolve is now a necessity.

You might be interested to read: A Flexible HR solution is a Need, Not a Want

Performance Practices

A recent study revealed that individuals who receive low-quality feedback at work are 63% more likely to leave their organisations compared to their counterparts. Clear expectations and success criteria were highlighted as a key issue, as 61% of individuals intending to stay had a clear understanding of their work expectations, while only 21% of those planning to leave did.

This highlights the importance of having a high-quality performance review process in place.

Ensure your performance reviews take a holistic approach, taking into account  a variety of metrics, feedback and consider the circumstances employees have been working in. This means looking at both numerical data, such as how many of the quarterly KPIs the employee did and did not hit, as well as more long-form information, such as feedback they’ve had about their ability to collaborate with other teams or innovative ideas they’ve produced.

Regular employee recognition that is trackable can be a great way for colleagues to show appreciation for each other’s hard work, while also providing data for line managers and HR to review and utilise for feedback in performance reviews. For this, you may choose to invest in an employee recognition tool.

Overall, HR need technologies that allow them to provide a flexible performance review process to their people. This is not only so it can be adjusted across teams but also can be updated overtime as workplace norms evolve. HR teams should not have to fit around clunky, set-in-stone templates in their HR solution, but rather have technologies that fit around them and their processes.

The xcd people platform provided this configurability and more for Landmark Space:

“With xcd, there are customisations that we could select – we knew that we wanted a fairly standard core HR and payroll solution, but we wanted something more bespoke when it came to the performance module and xcd could work that way.” – Henry Horsfall, HR Director at Landmark Space

Read the full case study.