Voluntary turnover

What it is

Voluntary turnover is when employees choose to leave a company on their own. It covers resignations for a new job, a career change, a move, going back to school or simply wanting something different. Retirements are often counted here too, though some companies track them separately.

It is one part of overall employee turnover. The other part is involuntary turnover, where the company ends the job through a dismissal, layoff or redundancy.

Why it matters

Voluntary exits are the ones you have the most power to prevent. People rarely leave for one reason. They leave because of pay, their manager, lack of growth, a poor start or a mix of these. Tracking voluntary turnover on its own shows whether people want to stay, which an all-in number can hide.

Each resignation also brings costs: recruiting, training a replacement, lost knowledge and extra work for the team while the seat is empty.

Not every resignation is bad news. Some people leave for reasons no employer could change, and some exits open a space for internal promotion. The goal is not zero voluntary turnover. It is to understand who is leaving, why, and whether you would have wanted them to stay. A rising rate among strong performers in one team is a much bigger signal than a steady rate spread across the whole company.

How it works

The formula follows the same logic as the overall turnover rate, but only counts people who chose to leave:

• Voluntary turnover rate = (voluntary leavers in the period / average number of employees in the period) x 100
• Average number of employees = (headcount at the start + headcount at the end) / 2
• Involuntary turnover rate uses the same formula, counting only people the company let go.

Example: a software company has 180 people on January 1 and 220 on December 31, so the average is 200. During the year, 18 people resign and 4 are let go. Voluntary turnover is 18 / 200 x 100 = 9 percent. Involuntary turnover is 4 / 200 x 100 = 2 percent. Total turnover is 11 percent. You can check your own numbers with the turnover calculator.

Best practices

• Record a clear reason code for every exit so voluntary and involuntary leavers are never mixed up.
• Split voluntary turnover by team, manager, role and tenure to find patterns.
• Separate regretted leavers (strong performers) from non-regretted ones.
• Run an exit interview for each resignation and look for repeated themes. These exit interview questions are a good place to start.
• Talk to people before they decide to leave, for example in stay interviews.

Common mistakes

• Counting people who were pushed to resign as purely voluntary.
• Looking only at the company-wide rate and missing one team with a big problem.
• Assuming pay is always the reason without asking.
• Ignoring first-year resignations, which often point to hiring or onboarding gaps.

FAQ

What is the difference between voluntary and involuntary turnover?

Voluntary turnover is when the employee decides to leave. Involuntary turnover is when the employer ends the employment, such as a dismissal or layoff. Both add up to total turnover.

What is a good voluntary turnover rate?

There is no single good number. It depends on your industry, location and type of roles, so compare against your own past results and similar companies.

Is retirement voluntary turnover?

Usually yes, because the employee chooses to leave. Some companies report retirements separately so they do not distort the picture of people leaving for other jobs.