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In today’s tight labor market, employers need to stay on top of anything that might cause employees to walk out the door. One place to look is the way your company handles sexual harassment.

A study published in the Journal of Applied Psychology found that sexual harassment increases the likelihood of staff turnover, even when controlling for factors such as job satisfaction prior to (or aside from) the harassment.

While it’s important to prevent sexual harassment for many reasons, the cost of turnover shows how it impacts the bottom line. Whether caused by sexual harassment or any other reason, turnover is expensive. It costs businesses money in several ways, including lost talent and productively, as well as dollars spent constantly recruiting and training new workers.

While the cost of replacing workers varies by industry and depends on salary range and other factors, some studies estimate it to be as high as 40 to 50 percent of a position’s annual wage.

Preventing sexual harassment is an important tool in the reduction of employee turnover and reducing the subsequent costs. Conversely, ignoring, denying, or covering up sexual harassment in an organization will likely increase employee turnover.

What can leaders do to prevent sexual harassment?

To reduce sexual harassment, management at every level, from frontline supervisors to HR to top executives, must lead by example to reinforce a culture of trust and respect.

Associates need to see that sexual harassment of any kind will not be tolerated at any level in the organization, and complaints will be taken seriously.

Leaders should make it clear that even a small instance of misconduct will be addressed appropriately before it violates the law. If a case is brought to the attention of management, it should be investigated promptly.

Additional impacts on the workplace In addition to turnover, failure to address sexual harassment in the workplace may result in a number of negative results, including:

  • Reduced employee morale
  • Workplace conflict
  • Reduced productivity
  • Negative work environment
  • Employment law violations
  • Court costs
  • Damaged company reputation

Turnover due to sexual harassment not just a cost of doing business

Of course, all the above-mentioned factors can contribute to high employee turnover. No one wants to continue working in a negative environment where they don’t feel safe or respected.

Companies that ignore the problem of sexual harassment must compete for talent with companies that do not consider sexual harassment to be just another cost of doing business and turnover to be inevitable.

Companies that take the issue seriously may look very inviting to an employee who has suffered or witnessed sexual harassment.

Key to remember

Taking measures to address sexual harassment can help reduce turnover and avoid other potentially devastating effects.