DOCUMENTED EAP OUTCOME
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Chevron
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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:
Separation Costs
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
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.
Training Costs
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.
Vacancy 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.