Managing High Labor Turnover: A Case Study on Leah's Bakery

Overview of Leah's Bakery

While out shopping, you decide to stop in at a friend’s business, Leah’s Bakery. Leah recognizes you and invites you into her office. She is eager to talk about her work, and in the conversation that follows she tells you she is about to mark the second anniversary of what has turned out to be a remarkable business. In terms of the breads, pastries, and other baked goods, customers cannot seem to get enough. On the other hand, Leah has the feeling that she is working harder than is ideal and that the Bakery is less profitable than expected. Being a people-oriented person yourself, you pick up on Leah’s comment on her difficulty in finding good employees. The following aspects of Leah’s Bakery emerge:

1)         It takes 15 employees to staff the bakery for a full week.

2)         Leah defines six different positions: 2 bakers (pastries and breads), 1 cake decorator, a retail clerk, and a shift supervisor who also works behind the counter.

3)         Leah has employed 240 people in the two years of operation. The shortest tenure was 2hours and the longest was 12 weeks.

4)         Pay for the employees ranges from $6.50 per hour (retail clerk) to $9.50 per hour (shift supervisor). There are no benefits.

Having 240 employees within a two year period seems to you extraordinary; it represents an 800% turnover – equivalent to a new set of employees every 6 weeks. Yet the information Leah has provided matches your observations. Even though you visit the bakery at least once a week, you seldom see familiar faces. The “Help Wanted” sign is a permanent fixture in the front window. On several occasions, you have even seen the shift supervisor interviewing applicants at the end of the counter.

As a frequent customer, you have noticed that the employees are pleasant and are obviously trying their best. At the same time, they frequently do not appear to understand certain common aspects of their jobs – for example, the functions of the cash register, how to enter special orders, the schedules for baking, ingredients of special items, and so forth.

Tasks

1)         What are some possible causes of the high labour turnover Leah’s Bakery is experiencing?

2)         If you were asked to help Leah’s Bakery, on what HR activities would you concentrate and why? And give your recommendations with the application of relevant theories and models.