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Forums › FIA Forums › MA2 Managing Costs and Finance Forums › labour turnover
sally ltd has a staff of 1500 at the beginning of the year, and owing to the series of redundancies caused by the recession, 1000 at the end of the year. voluntary redundancy was taken by the 500 staff at the end of the june, which is 200 more staff than what the company had anticipated. the 200 excess redundancies were immediately replaced by new joiners.
calculate the labour turnover rate?
Labour turnover = Leavers replaced ÷ Average number of employees × 100%
The numerator therefore excludes the leavers who are not replaced (e.g. through redundancy)
Taking you example, labour turnover = 200 ÷ 1/2 x (1,500 + 1,000) = 16%