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Adverse Workplace Conditions, High-Involvement Work Practices and Labor Turnover: Evidence from Danish Linked Employer-Employee Data

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Author Info

  • Cottini, Elena

    ()
    (University of Milan)

  • Kato, Takao

    ()
    (Colgate University)

  • Westergård-Nielsen, Niels C.

    ()
    (Copenhagen Business School)

Abstract

This paper contributes to the emerging strand of the empirical literature that takes advantage of new data on workplace-specific job attributes and voluntary employee turnover to shed fresh insights on the relationship between employee turnover, adverse workplace conditions and HRM environments. We find evidence that workers in hazardous workplace conditions are indeed more likely to separate from their current employers voluntarily while High-Involvement Work Practices (HIWPs) reduces employee turnover. Specifically, exposing a worker to physical hazards such as loud noise, vibration or poor lighting will lead to a 3 percentage point increase in the probability of turnover from the average turnover rate of 18 percent; working in a fixed night shift will result in an 11 percentage point jump in the turnover probability, and having an unsupportive boss will lead to a 5 percentage point increase. The effect of HIWPs is modest yet hardly negligible with a 4 percentage point reduction in the turnover probability from having voice in the workplace. Furthermore the turnover-increasing effect of physical hazards is found to be significantly reduced by the presence of strong information sharing whereas the adverse effect on turnover of the use of fixed night shift is also found to be significantly mitigated by the authority delegation to workers by management. As such, our evidence lends support to those who advocate the use of HIWPs for those firms with employee turnover problems due to hazardous workplace conditions. Finally, our logit analysis of the 5-year odds of improving workplace conditions suggests that the worker exposed to adverse workplace conditions can improve her long-term odds of rectifying such workplace adversities significantly by separating from the firm voluntarily. Voluntary turnover appears to be a rational worker response to adverse workplace conditions, and unless the firm alleviates its adverse workplace conditions directly or mitigates their effects on voluntary turnover through HIWPs, workers exposed to adverse workplace conditions will likely continue to take the exit option.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4587.

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Length: 38 pages
Date of creation: Nov 2009
Date of revision:
Publication status: published in: Labour Economics, 2011, 18 (6), 872-880
Handle: RePEc:iza:izadps:dp4587

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Keywords: employee turnover; workplace conditions; human resource management; high-involvement work system; high-performance work system;

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Cited by:
  1. Bernhard Boockmann & Jan Fries & Christian Göbel, 2012. "Specific Measures for Older Employees and Late Career Employment," IAW Discussion Papers, Institut für Angewandte Wirtschaftsforschung (IAW) 89, Institut für Angewandte Wirtschaftsforschung (IAW).
  2. Silvia Sacchetti & Ermanno C. Tortia, 2012. "A “Human Growth” Perspective on Organizational Resources and Firm Performance," Department of Economics Working Papers 1209, Department of Economics, University of Trento, Italia.
  3. Mohrenweiser, Jens & Zwick, Thomas & Backes-Gellner, Uschi, 2013. "Poaching and firm-sponsored training: First clean evidence," ZEW Discussion Papers 13-037, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  4. Ray Markey & Katherine Ravenswood & Don Webber, 2012. "The impact of the quality of the work environment on employees’ intention to quit," Working Papers 20121221, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
  5. Eriksson, Tor & Villeval, Marie Claire, 2012. "Respect and relational contracts," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 81(1), pages 286-298.
  6. Lanfranchi, Joseph & Pekovic, Sanja, 2014. "How green is my firm? Workers' attitudes and behaviors towards job in environmentally-related firms," Ecological Economics, Elsevier, Elsevier, vol. 100(C), pages 16-29.
  7. Corinne Perraudin & Héloïse Petit & Antoine Rebérioux, 2011. "Worker information and firm disclosure: Analysis on French linked employer-employee data," EconomiX Working Papers 2011-37, University of Paris West - Nanterre la Défense, EconomiX.

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