The Role of Employee Retention Practices in the Sustainable Development of an Organization

Abstract The retention of employees has shifted from a traditional human resources management issue into a strategic factor that can affect the sustainability of an organization. Paying attention to employee retention is a critical component of the succession planning during this era of modern organizations as it not only helps them save on recruitment and replacement expenses but also aids them in maintaining the organizational knowledge, fostering employee engagement, ensuring organizational productivity and continuity, and building long-term competitive capability. Sustainable development gives organizations the challenge of making a business case that represents a balance of economic performance, social responsibility, employee well-being and the environment. This article is a literature review that investigates the role of employee retention practices in the sustainable development of organizations by linking employee retention, sustainable human resource management (SHRM) and organizational commitment and sustainability. The article theorizes the mechanisms of employee retention in the context of compensation and benefits, career development, training and learning, leadership and supervisory support, employee engagement, recognition and reward, work-life balance, organizational culture, job security, employee well-being, participation and workplace safety. These practices are analyzed on the basis of three dimensions of organizational sustainability; namely, economic sustainability, social sustainability and environmental sustainability. The review concludes that effective retention practices can help achieve organizational sustainability through preventing unwanted turnover, safeguarding organizational knowledge, enhancing employee commitment, boosting in-house resources, fostering non-immoral workplace behaviours and promoting sustainability continuity. The article also suggests an integrated conceptual framework, where retention practices impact the sustainable organizational development through employee satisfaction, organizational commitment, engagement, knowledge retention, and perceived organizational support. The article adds to the literature by not only suggesting that employee retention is a tool for managing turnover but also that it can be a strategy to build sustainable human capital and establish sustainability in the long term. Implications for managers and directions for future empirical research are discussed.