The relationships between Human Resource Practices on Employee Retention in Malaysian Industrial Settings

Objective – The study explores the relationships between human resource management practices on employee retention in Malaysian industrial settings. The human resource management practices such as selection, training and development, performance appraisal and reward were considered in this study as the main factors that impact the employee retention in an organization. Methodology/Technique – All data used in this study consists of respondents of executives and managers in manufacturing companies located in Klang Valley, Malaysia. Data processing and statistical analyses were mainly carried out using SPSS. Reliability test was used to check the consistency and dimensionality of the scale items. Pearson Intercorrelation was used to measure the associations among the human resource practices and employee retention and Multiple Regression Analysis to check the criterion-related validity of the scale items and to complement the correlation results. Findings – Data from 151 respondents from various industries showed that the reward was most correlated with employee retention. This is followed by performance appraisal, in which fair and inclusive appraisal leads to better retention. On the contrary, selection was found to have least significance relationship with employee retention. Novelty – The contribution of the study is in asserting some findings for human resource manager to understand the importance of an effective HRM practices on employee retention in the manufacturing industry. Apart from that, this research provides an understanding of some important elements in human resource management practices that are more effective in employee retention. Type of Paper: Empirical