Tracking turnover rates has always been a priority in HR, but in today’s remote and hybrid workplaces, it’s more critical — and complex — than ever. With teams dispersed across cities, time zones, and even continents, it can be challenging to gauge who’s in it for the long haul versus who may be on their way out.
But turnover rate isn’t just a metric on a spreadsheet; it’s a vital tool for understanding team dynamics, driving engagement, and nurturing a healthy company culture in a virtual setting.
In this guide, we’ll break down how to accurately calculate turnover rates in the age of remote and hybrid work, along with strategies from companies that are redefining retention in today’s evolving work landscape. So, let’s dive in!
Before diving into the numbers, let’s look at how turnover rates differ in traditional versus remote work settings. In a traditional office, turnover is visible — an employee leaves, their desk is empty, and the HR team takes note.
However, in remote or hybrid environments, the impact is less obvious and often deeper. Turnover doesn’t just mean an empty seat; it disrupts team coherence, affects morale, and can even impact productivity and client relationships.
Remote teams are inherently more volatile — turnover here can trigger ripple effects that disrupt workflows, lower productivity, and weaken trust. When someone leaves a remote team, the gap is felt more acutely because the loss can complicate communication, delay project timelines, and make it harder for teams to rally and cover responsibilities seamlessly.
For those who value simplicity, the turnover rate formula is a reliable starting point. It captures how frequently employees leave over a given period and looks like this:
Turnover Rate (%) = (Number of Employees Who Left / Average Number of Employees) x 100
Here’s a quick breakdown:
Determine the Number of Departures: Count how many employees left within your chosen period (e.g., monthly, quarterly, or yearly).
Calculate the Average Number of Employees: Add the number of employees at the start and end of the period, then divide by two. This average helps balance any growth or reduction in headcount.
Run the Formula: Plug these values into the formula to get your turnover percentage.
Example: Imagine you started the quarter with 100 employees and ended with 90, and 15 employees left during this period. The average number of employees would be (100 + 90) / 2 = 95. Then, using the formula:
Turnover Rate (%) = (15 / 95) x 100 = 15.79%
This means the turnover rate for that quarter was approximately 15.8%.
While this straightforward approach works well in a traditional office setting, it doesn’t fully capture the nuances of remote or hybrid environments.
In these setups, turnover can carry added layers of complexity, affecting communication, team morale, and even project timelines in ways that aren’t immediately visible. That’s why remote teams often require more comprehensive analytics to understand turnover’s full impact.
Turnover rates need to be customized a bit for the return of employees in the remote work world. If we only rely on the classic turnover formula, things may go unnoticed since factors like engagement dips or a unique retention challenge are more specific to a remote setup.
Traditional turnover metrics are now being supplemented with additional data points specific to the workforce, such as engagement scores, digital presence (with on-demand video interviews/auditions), and pulse survey feedback for companies.
GitLab (an all-remote company) uses exhaustive documentation and regular employee polling to spot potential issues that might lead to turnovers. Their every move is meticulously measured, with regular pulse checks to understand employee engagement and job satisfaction that gives them an index on the morale of their teams.
Being proactive with the talent they learn about, enables them to spot early signs of disengagement and act before a resignation email hits their inbox.
Monthly turnover snapshots can be deceptive, especially if you work in a remote or hybrid work environment with shifting working dynamics. By contrast, a rolling 12-month turnover calculation spreads the exits over the past year.
This takes the form of a more accurate and stable long-term view of turnover trends which is essential to spot broader patterns such as seasonal spikes or project-based exits between teams.
If you see a pattern of high turnover at the same times each year, then it gives you more insight into possible causes — whether that be project deadlines, end-of-year stress, or something entirely different.
Calculating turnover for remote and hybrid teams goes beyond tweaking the traditional formula — it requires a fresh approach altogether. Remote teams face unique challenges, like isolation, maintaining engagement, and balancing work-life boundaries in home offices that double as personal spaces. These factors make turnover far more complex, impacting everything from team morale to project timelines.
With remote teams, voluntary turnover has a more significant effect than involuntary (layoffs or company-driven restructures). If a remote employee quits on you, they probably did so voluntarily—and the better you get to know why, the more likely it is that the scenario doesn’t repeat itself. Voluntary exits — (often driven by disengagement or loneliness …neither of which are super great reasons) can shed light on things like a bad culture, weak engagement practices, and inadequate remote support.
Once you strip these out from layoff numbers, what remains is a still-unpleasant but hopefully more telling tally of where and why people are opting to leave; we can then target retention initiatives in the right places rather than attacking remote symptoms.
Engagement is the lifeblood of remote teams, you can track it just by simply looking at Slack usage or with entire pulse surveys and engagement scores which are more complex. A decrease in these metrics might not signal simply a “bad day”, but could be the start of retention issue festering.
So, what should you track? Think of responses to check-ins that are more frequent, and attend any team meetings and morale surveys. In these areas, low participation is equivalent to a missing person sign and acts as an early warning mechanism for those who are likely headed in that direction if intervention does not happen soon.
Monthly turnover snapshots can miss the natural ebb and flow of remote work patterns. A rolling 12-month turnover rate, which tracks employee exits over the past year, provides a more comprehensive view. This approach is especially useful for identifying seasonal trends or peak turnover periods, such as high-stress cycles, enabling you to anticipate and address challenges before they escalate. With these insights, you’ll be better equipped to plan, using a proactive strategy tailored to your team’s specific turnover patterns.
Hybrid teams bring a unique set of challenges when it comes to turnover — employees are split between physical office spaces and remote locations. For many, the lack of in-person connection can be a dealbreaker, leading to disengagement or even departure. To navigate this complexity, consider measuring turnover by location group.
Run rate comparisons: Examine turnover rates separately for in-office and remote employees to identify where additional support or flexibility may be needed. This approach can help reveal trends that might indicate where employees are struggling or are at risk of leaving.
Additionally, this ensures that both in-office presence and remote logins are captured accurately in turnover metrics, giving you a clear view of who might need extra support and helping you take proactive steps to retain your team.
Real-World Case Study:
Automattic – Keeping Turnover Low Through Transparency and Flexibility
Automattic, the parent company of WordPress, has operated remotely for years with employees scattered across the globe. Known for its radical transparency, Automattic implemented a clear salary structure visible to everyone in the company. Not only does this foster trust, but it’s also a retention tactic: employees know they’re being paid fairly, eliminating one key turnover trigger.
Automattic’s approach to flexibility and autonomy is also legendary. Employees can decide when and how they work, provided they meet their goals. By measuring turnover and employee satisfaction data quarterly, Automattic ensures it has a real-time pulse on its workforce. If engagement dips, they immediately explore what’s wrong, whether it’s project burnout or communication gaps, making it possible to prevent potential turnover before it happens.
You can track turnover rates, which is great but it’s a different story to understand why people are leaving. This is further complicated with remote work since you cannot pick up on the room vibe and body language that easily. Let´s explore 3 of the most significant factors related to turnover — pay, development, and engagement along with some strategies on how they may be tackled in a remote world.
When you see noPing-Pong tables, snack bars, or whatever other goodies your company has to offer competitive compensation becomes more important in attracting high-quality employees. Transparent pay structures, much like the infamous company Buffer uses, make it clear that everyone’s on a level playing field.
The transparency, in this case, was not sharing numbers related to the business but rather building trust. Wage transparency decreases employee desire to scout the job market for a better remote role, as employees feel assured they are being paid fairly.
When working remotely, employees can often find themselves feeling a little bit forgotten about (out of sight, out of mind) and knowing how your pay scales work or where you sit within that structure could be a deal breaker for them. As companies continue to pull the curtain back, they gain loyalty and lower their turnover.
Tips: Offer more than the standard pay, roll out “remote-friendly” benefits (e.g.- mental health days or fitness reimbursements), home office stipend…etc. For staff, this means that instead of just productivity the company is also addressing their human needs. That sets the bar high…small but meaningful perks can be the hook that keeps remote workers engaged, and flexible benefits align their daily realities with how you value them.
When you work remotely, the concept of “career growth” can seem like a mythical creature. With the context of a physical office to catch management’s eyes, some employees will feel their careers stagnating. A clearly defined career path, guided by mentoring and development opportunities moves the needle. By providing development opportunities or developing a personal career path, organizations are demonstrating their intention to invest in people — not just for today but also in the years ahead.
For remote workers, the lack of visibility around learning and development can be a double whammy. Being physically separated from both mentors and trainers can be isolating. This gap can be filled by regular virtual check-ins, skill-sharing sessions, or cross-functional projects.
Tip: Encourage career path mapping and development discussions with direct managers to foster progression. Conversations should not just be about what the employee did in that period but also, about how they are doing now and where they want to go. Mentorship programs are a win as well, as they help remote employees feel engaged and remain on the path of growth.
The word “culture” could sound like yet another buzzword on a Slack channel, but it is a crucial retention factor. It can feel like a silo-ed group of individuals working in parallel instead of functioning as one cohesive unit. To build a lively working culture it takes creativity and intention like holding a virtual “all hands”, casual digital hangouts, or fun online events that can remind individuals of the bigger picture beyond their to-do lists.
What does engagement have to do with retention, though? This whole employee connection is not just a nice-to-have — it’s vital to maintain high morale. If a remote team member does not feel connected to the team or the company’s purpose, they are more likely to go elsewhere.
Tip: Build a robust virtual culture by conducting “all hands” calls more frequently. Leverage social channels or group chats for casual convo and let virtual team-building activities help replace IRL ones. Having a simple coffee chat could make a huge difference in making employees feel like they belong.
Turnover measurement often does not tell the whole story. Engagement and satisfaction of remote teams demand detailed scrutiny. Here are some Critical Metrics to add turnover Data:
Calculating turnover rates in the era of remote and hybrid work demands a fresh perspective, but it’s entirely achievable with the right tools and metrics.
Adapt your approach by factoring in voluntary departures, engagement levels, and location-based insights. Remember, calculating turnover is just the beginning — truly understanding and addressing the root causes behind it is what builds a resilient and loyal team.
Leading remote-first companies like Automattic and GitLab offer valuable lessons. By adopting their practices of transparency, flexibility, and continuous feedback, you can help keep turnover in check and foster an environment where remote and hybrid employees can genuinely thrive.
Involuntary turnover is related to restructuring, terminations, and layoffs whereas voluntary turnover takes place when any employee quits by choice because of personal reasons, career growth, and dissatisfaction.
Use the traditional turnover formula but consider adding engagement metrics like eNPS and analyzing exit interview data to understand unique remote challenges.
In the tech industry, turnover rates typically range between 13% and 18%, with an average of around 13.2%, which is notably higher than many other sectors. This is partly driven by the intense demand for tech skills, creating a competitive environment where employees frequently receive new offers and often leave for roles with higher salaries, better growth opportunities, or more innovative projects.
It is better to consider quarterly or monthly assessments. The 12-month rate is exceptionally good for gaining some insights especially when the team has turnover variations over the seasons.
Definitely! Indication of burnout is possible with frequent turnover when employees claim extreme work pressure and stress as the key reasons to quit. Early signs are detectable using regular pulse surveys and eNPS tracking.
