ALEXANDRIA, Va.—When one employee leaves a job, whether voluntary or not, others will follow, reports the Wall Street Journal. A recent paper that studied attrition at a major retailer found that attrition among employees was up after a person quit or was laid off; however, high-performing and low-performing employees often responded differently to layoffs, firings and voluntary departures.
The study found that employees who had performance reviews in the top 40% were more impacted by layoffs than employees with reviews in the bottom 40%. The attrition rate for high-performing employees increased by about a third to about 2% from 1.5% within six months of the layoff announcement. For low-performing employees, attrition was up slightly from 2.01% to 2.15%.
According to Sima Sajjadiani, an assistant professor at the University of British Columbia’s UBC Sauder School of Business and one of the paper’s co-authors, high-performing employees are more likely to leave after a fellow employee departs because they typically have more employment options.
“Companies should consider the possible ripple effect when they make decisions about layoffs, especially because high performers are disproportionately affected,” she says.
The study found that after an employee was dismissed for cause, the voluntary turnover rate for the entire sample decreased from 5.22% to 5.04% within six months of the termination. However, when looking more closely at high- and low-performing employees after a low-performing employee was dismissed for cause, the voluntary turnover rate among high performers fell to 1.43% from 1.5% within six months. But the turnover rate for low performers increased over six months to 2.24% from 2.01%.
“High-performing employees may view the dismissal of a low-performing colleague as the organization maintaining standards, which can be seen as a positive sign about the organization’s commitment to performance,” Sajjadiani says. “On the other hand, low-performing employees might perceive the dismissal of a similar peer as a warning sign that they might be next, leading to an increase in voluntary turnover among this group.”
However, low performers did not leave when high performers left the company. And when a low performer quit, it slightly improved the retention rate for high performers.
Similarly, voluntary departures followed suit. For every five employees who quit, another employee left the company within six months. They also found that high performers tended to follow other high performers out the door, and low performers tended to do the same.
“Employees seem to be aware of their own level of performance,” says Sajjadiani. They often see a peer leaving as a signal to look for a better fit elsewhere—but only if that peer matches their quality of work.
According to Sajjadiani, companies should maintain high performers’ job satisfaction so they, and their high-performing colleagues, choose to stay put. But when low performers leave, they tend to take others with them—which might not be so bad for the organization.
Learn about the Good Jobs Strategy, which can increase your employee retention, productivity and satisfaction.