Skip to content
TeamPredict
Turnover and attrition

What is involuntary turnover?

Definition

Involuntary turnover is a departure the company initiated: a termination, a performance exit, or a layoff.

Last updated

Involuntary turnover covers every exit the company started.

It includes dismissals for cause, exits after a performance process, redundancies and layoffs, and fixed-term contracts the company chose not to renew. The common thread is that the decision sat with the employer.

Its counterpart is voluntary turnover, where the employee decided. Who chose is one of three separate tags every exit can carry.

Company decisions and employee decisions need separate numbers.

Mixed into one total it hides the real story. A quarter of involuntary exits after a restructure is a plan working, the same number of voluntary exits is a problem.

Involuntary exits are management decisions, so they belong in workforce planning and performance reporting. Voluntary exits are the retention signal. Keep them apart and each number answers one question.

The involuntary rate uses the same average headcount.

Formula

Involuntary turnover rate = involuntary separations ÷ average headcount × 100

It helps to split it again: layoffs and restructuring on one line, performance and conduct exits on another. A layoff is a business decision. A performance exit is often a hiring or management signal.

Here is a worked example with round numbers.

Take an invented company with an average headcount of 500 over the year. It made 15 roles redundant in a restructure, and 5 more people left after a performance process.

Involuntary separations are 15 + 5 = 20, so the involuntary turnover rate is 20 ÷ 500 × 100 = 4%. The 15 redundancies were the plan. The 5 performance exits are the number worth looking into, because each one usually started with a hire that did not work out.

Context decides whether an involuntary rate is good or bad.

A spike in the quarter after a planned restructure is expected. A steady stream of performance exits from the same team, or from people hired in the same period, points at selection or management, and connects to the cost of a bad hire.

These are the common mistakes with involuntary turnover.

  • Folding layoffs into the turnover rate that the retention program is judged on.
  • Recording a pushed-out employee as a resignation, which flatters the involuntary number and inflates the voluntary one.
  • Forgetting that a layoff can unsettle the people who stay, which can show up later in the voluntary rate.
  • Treating every involuntary exit as functional. A layoff can remove people you would have paid to keep.

Find out what one wrong hire costs.

Performance exits often trace back to a hire that did not work out. The free calculator totals what one costs, from lost productivity to the replacement.

Calculate the cost of a bad hire

Free, no signup required.

These related terms are in the glossary too.

  • Voluntary turnover

    Voluntary turnover is a departure the employee chose: a resignation, a retirement, or a move to another employer.

  • Employee turnover

    Employee turnover is the movement of people out of a company over a set period, counted as the employees who leave and are replaced.

  • Functional turnover

    Functional turnover is a departure that leaves the organization better off, typically a low performer or a poor culture fit choosing to move on.

  • Cost of a bad hire

    The cost of a bad hire is what a hire who does not work out costs you in total, from sourcing and onboarding through lost productivity, manager time, exit and re-hiring.

  • Separation

    A separation is any end of the employment relationship, voluntary or involuntary. It is the numerator in most turnover formulas.

  • Non-regretted attrition

    Non-regretted attrition is a departure the company is neutral about or relieved by, usually a poor fit or a sustained performance problem.

These pages on this site go deeper.

Back to the HR glossary, where all 52 terms are defined.