Balancing home and work life is a constant challenge for many employees and as such the prevalence of family-friendly company benefits programs, such as childcare and employee assistance programs, has increased as companies seek further avenues to competitive advantage. A study examining the relationship between employee satisfaction, family-friendly benefits programs and employee turnover in U.S. federal agencies found that satisfaction with family-friendly programs reduced turnover levels, although the turnover effect differed by benefit program.
Key Topics: Benefits; Family-friendly programs; Employee turnover; Employee satisfaction
Title of Reviewed Article: Does Satisfaction With Family-Friendly Programs Reduce Turnover? A Panel Study Conducted in U.S. Federal Agencies.
Researchers: James Gerard Caillier (The University of Alabama).
Publication: Public Personnel Management, 2016, Vol. 45 No. 3, pp. 284-307.
Setting the Scene
As family dynamics and the composition of the workforce continue to evolve, many workers have significant home responsibilities in addition to their job. In response, more companies are implementing family-friendly benefits programs to meeting the work-family needs of employees and curb some of the negative effects of work-family balance issues such as low morale, absenteeism, and high turnover (Somech & Drach-Zahavy, 2012).
The rationale for companies offering such programs can be taken from social exchange theory, which contends that employees who benefit from family-friendly programs will perceive that their company values their wellbeing and which will encourage employees to respond through reciprocation with behaviors that are valued by the company, such as performing well and remaining with the company (Ko & Hur, 2014; Lee & Hong, 2011).
Previous studies on the relationship between of family-friendly programs and employee turnover in public agencies suggest that the number of policies offered has little bearing on turnover, which appears contrary to social exchange theory. A study of US public agencies found that offering more family-friendly programs did not lead to lower turnover (Durst, 1999), while a similar study in South Korea found no relationship between the number of programs offered and turnover rate (Bae & Goodman, 2014). What these findings suggest is that just offering more programs may not be enough to elicit social exchange, and that it may be more important for employees to be satisfied with the programs offered.
This study sought to examine the role of employee satisfaction with various family-friendly benefits programs and employee turnover in US public agencies, and as such outlined a number of research questions:
Hypotheses 1-7 - Employee satisfaction with (H1) family-friendly programs (H2) telework (H3) alternative work schedules (H4) child care (H5) elder care (H6) employee assistance programs (H7) health and wellness programs will have a negative effect on turnover.
How the research was conducted
36 different US federal agencies were assessed over a 4-year period (2010-2014). Turnover rates and satisfaction with family-friendly programs were assessed at these agencies. These benefits programs included alternative work schedules, telework, health and wellness programs, employee assistance programs, elder care, and child care.
This study used data from the Federal Employee Viewpoint Survey (FEVS) and FedScope (FS). FEVS is an annual survey conducted by the U.S. Office of Personnel Management on employees of federal agencies and includes employee perceptions in relation to various family-friendly programs. FS is a database which contains aggregate data on federal agencies and includes various employment related information.
Key Research Findings
Generally, employee satisfaction with the family-friendly programs assessed in this study was found to result in lower turnover rates, although the results differed across the programs. This finding gives support to Hypothesis 1.
Satisfaction with child care programs, alternative work schedules, and employee assistance programs all reduced turnover. These results support Hypotheses 3, 4, and 6.
On the other hand, elder care, wellness programs, and telework were not found to impact turnover levels. Given these results, Hypotheses 2, 5, and 7 were not supported.
As expected, the results indicated that family-friendly benefits programs led to lower employee turnover, which is consistent with contemporary social exchange theory. Further, the results indicate that it is the employee's satisfaction with these benefits programs that trigger a social exchange, resulting in lower turnover, rather than purely the quantity of programs on offer to employees. This potentially explains why some studies (Durst, 1999; Bae & Goodman, 2014) found family-friendly policies not to have an effect on employee turnover.
Interestingly, a number of the programs examined, namely elder care, wellness programs, and telework, were not found to reduce employee turnover. While this study does not examine the reasons for this, the results suggest that they are not valued to the same extent as those programs that do affect turnover levels.
Organizational and Reward Implications
While the results do not suggest that family-friendly benefits programs should be seen as cure all solution to employee turnover, satisfaction with such programs was shown to have an effect in reducing turnover, with child care programs, employee assistance programs, and alternative work schedules having the greatest effect.
Companies should consider offering such family-friendly benefits programs to employees, although careful consideration of the types of plans and the employer cost of plans is advised. Given that these plans typically are valued differently by different employees based on various factors such as age, gender, and family size, a flexible individualized approach to offering these benefits to employees is likely to yield the most impact for companies (Lee et al, 2002).
This study helps shed further light on the impact of family-friendly benefits programs on turnover, and highlights the importance of employee satisfaction in these benefits on their impact. Further research on these relationships using a larger data set and in other countries outside of the US would be of value in deepening our understanding of family-friendly benefits programs.
Source Article: Caillier, J. G. (2016). Does Satisfaction With Family-Friendly Programs Reduce Turnover? A Panel Study Conducted in U.S. Federal Agencies. Public Personnel Management, 45(3), 284-307.
Published by: Sage Publications
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Bae, K. B., & Goodman, D. (2014). The influence of family-friendly policies on turnover and performance in South Korea. Public Personnel Management, 43(4), 520-542.
Durst, S. (1999). Assessing the effect of family friendly programs on public organizations. Review of Public Personnel Administration, 19(3), 19-33.
Somech, A., & Drach-Zahavy, A. (2012). Coping with work-family conflict: The reciprocal and additive contributions of personal coping and organizational family-friendly support. Work & Stress, 26, 68-90.
Ko, J., & Hur, S. U. (2014). The impacts of employee benefits, procedural justice, and managerial trustworthiness on work attitudes: Integrated understanding based on social exchange theory. Public Administration Review, 74(2), 176-187.
Lee, Y., & Hong, J. H. (2011). Does family-friendly policy matter? Testing its impact on turnover and performance. Public Administration Review, 71(6), 870-879.
Lee, M. D., MacDermid, S. M., Williams M. L., Buck M. L., & Leiba-O’Sullivan S. (2002). Contextual factors in the success of reduced-load work arrangements among managers and professionals. Human Resource Management, 41(2), 209-223.