Documented EAP Outcome
Chevron has recognized savings of $50,000.00 per case from reduced turnover due to EAP use. Chevron also reported "employee performance improved 50% following a supervisor referral to the EAP."
Cost of Losing an Employee
Studies vary but show overwhelmingly that it is more economical to give an employee a moderate raise than it is to replace the employee. The cost of losing an employee averages over $15,000 on the low end and potentially $30,000 or more for employees earning $60,000 plus annually. How are these losses calculated?
According to the Division of Cooperative Extension, University of Wisconsin, these costs include four primary areas:
The cost for an employee to leave a company involves the administrative work of termination, potentially severance pay, and even an increase in unemployment compensation. Exit interviews, if performed, are another consideration.
Replacement costs will depend on how difficult the position is to fill, but include items such as finding applicants, interviews, testing, background checks, and employee orientation. Other possibilities include medical exams and relocation expenses.
Depending on the position, there may be both informal and formal training. The former includes materials and time spent getting a new employee acclimated to the new environment, while the latter involves structured training which employees receive during the course of employment. Additional training obviously adds more to these costs.
Though savings may occur fulfilling vacancies with overtime or temporary help, these costs should be considered in the total cost of losing an employee.