EMPLOYEE TURNOVER IN MALAYSIA:

CHAPTER NO.1:
(1.1)

RESEARCH BACKGROUND:

Employee turnover is basically based on the intentions of an employee intending to leave an

organization. It includes all kind of employees who are working on year-on-year basis, voluntary
and involuntary, also including those resign in any case, it would be concluded as employee
turnover. Employees play an important role in the progress and the prosperity of the company
and industry they are working in. in every company there are different types of the employees,
some are as crews or some are as the managers and vice versa. The goals of the company are
been set by the entrepreneur but the people behind who are working all together to come up with
the objectives are the employees of the company working. So the importance of the employees
cant be neglected Price (1977). Overall performance of the company can be measured by the
contributions of the employees working in a company Jackofsky (1984). There are few of the
industries where employees are been considered as robots and gets pressurized by the top
management to work, but this factor may causes a huge problem for that industry. Employees, if
they are happy with the firm they are working in then there are more chances for the company to
achieve the goals but if the employees if they are not happy with the firm they are working in,
then there is a sign of a danger for a company. Employees are as important in the company as a
company itself is, so as a point to be paid attention on, each and every employee in a company
has its own importance which cant be neglected. Mitchell & Lee (2001)
The purpose of the study is to highlight the facts of turnover of the employees Whitmore (1979).
The cause of the employee turnover is sometimes job dissatisfaction which may lead an
employee to quit the current job in order to hunt another. This study highlights the turnover
causes not on the basis of international level but on the national turnover crisis in Malaysia. The
case study is also to clarify few steps which opens up the factors that how much a company when
there are turnover crisis going on.
In every company when employees are hired up for a particular post, they are given few of the
trainings and development orientations and programs in order for them to be trained enough to
give their 100% in their positions.

EMPLOYEE TURNOVER RATE IN MALAYSIA

Year
Turnover rate

(1.2)

2008
18.70%

2009
2010
2011
18.30%
15.90%
15%
Source: Employee turnover costs, 2012.

2012
15.20%

PROBLEM STATEMENT:

Employees are the part of the company itself where there are few of the tasks for them to cover
up the company requirements. Employees need to be highly significant in the vision of the top
management and higher departmental. It is the duty in every company of every top management
departments to motivate employees in the first place where they can contribute to the best in that
company. In some organizations, there are few of the programs based on to motivate the
employees and restrict their loyalty in the company. If there is a problem faced of the turnover
crisis in a company, then not only the operations of the company would be affected but also
impact the end profit. In the case to stop such crisis, organizations like the banks working under
commercial resources had designed a number of retention programs in order to increase the
employee loyalty to reduce the turnover rate. Example of the retention programs are like
programs on the salary and benefit and compensation programs. By such programs, there are
more of the chances where employees take a minute to think that they are been given the
importance and their work is to be recognized and rewarded among the top departmental.
Turnover was never seen without a cause but it has been always notified where there was a
discouragement, discrimination, de-motivation or less salary factor. Once employee turnover in a
particular organization takes place then such crisis goes on and on leading a company in deep
problems. Employees complaint sometimes gets neglected or there are no flexibilities when they
are assigned for a job. That is what makes an employee uncomfortable and feel the urge of
quitting the job. There are few of the cases where the employees are been replaced with the other
employees with a reason that new employees can be better than the one before, but at the end of
the year when then the employee turnover is calculated, there is a loss of costs operations,
recruitment costs and other losses which becomes the centre of attention for the organization
itself. Like for example 25 percent of the employee turnover would mean that one-quarter of the
employee at the beginning of the year has left the organization by the end of the year.

Employee turnover is a very renowned problem commonly faced among few of the organization
which involves not only the lower but also the top management employees. Turnover is often
encouraged by the job availabilities for the employees in different organizations greater
packages. Even though there are few of the cases where the organizations tried their best to cover
up the employee turnover rate but they couldnt because the employees were looking forward to
have better opportunities and great offers for their better career. Therefore it became difficult for
the organizations to reduce the employee turnover rate among their employees. So the point is
that there are a bunch of reasons where the turnover crisis among the employees. Steers and
Mowday (1981)
(1.3)

RESEARCH QUESTIONS

(1.3.1) GENERAL QUESTION:

What are the factors that will affect the employee turnover in Malaysia?
(1.3.2) SPECIFIC QUESTIONS:
1. How does job dissatisfaction affect the employee turnover in Malaysia?
2. How does discrimination factor at the workplace affects employee turnover in Malaysia?
3. How does low salaries affect employee turnover in Malaysia?
4. How does the work place environment affect employee turnover in Malaysia?
(1.4) RESEARCH OBJECTIVES:
(1.4.1) GENERAL OBJECTIVE:
The main objective of the research is to determine the factors affecting employee turnover in
Malaysia.

(1.4.2) SPECIFIC OBJECTIVES:

1. To investigate the relationship between job dissatisfaction and employee turnover in Malaysia?
2. To investigate the relationship between discriminative factors and employee turnover in
Malaysia?
3. To investigate the relationship between low salaries and employee turnover in Malaysia.
4. To investigate the relationship between workplace environment and employee turnover in
Malaysia.
(1.5) SIGNIFICANCE OF THE STUDY:
Employee turnover is not only in Malaysia but this problem is been faced by almost every part of
the country and in every organization of the industries. There are different reasons when it comes
to the problem of employee turnover. Employee turnover most of the times takes place when
there is a problem in the company or the personal issues of the employees quitting the job or
switching one organization to another Beam, J. (2014, December 25). So there are a numerous
reasons on which there can be a brief discussion. With the help of this study, we would be able to
find out what are major affects which can force an employee to change his/her mind for the job
and how it can be resolved.
The main scope of the study is to aim the factors which are affecting employee turnover in
Malaysia. Employee turnover varies country to country. Every country and every organization
has its own problems by which turnover takes places. This study may be helpful to overcome this
problem in Malaysia and can also come up with some positive policies over this problem which
will help reduce this problem in Malaysia.
(1.6) SCOPE OF THE STUDY:
The scope of the study would be on the employee practices working in the international or
domestic organizations in Malaysia. Main reasons of the employee turnover causes would also
be figured out with the help of the respondents taking part to help complete this study. There

cant be only the reason with the employee where there is a problem of an employee turnover but
also sometimes the organizations can also be the reason behind it in the process with the greed of
more skilful employees in order for the company to be more superior then the one they are in
competition with. There would be a survey with the people who are working in different
organizations in Malaysia, from where we will get to know the main reasons of the employee
turnover problems. The respondents would be anywhere from Malaysia but just the condition for
filling up the survey would be that they mustve worked in any organization of Malaysia so that
they will be able to give the information in an appropriate manner. We will be doing the survey
from approximately 100 to 150; by this technique we might obtain the data in a more accurate
way.
(1.7) DISSERTATION OUTLINE:
Generally, this thesis is alienated into three most important chapters including chapter one,
chapter two, and chapter three. First chapter contributes the background, problem statement,
research questions, objectives, significance of the study, and scope of the study and research
structure in accomplishing the research objectives.
In chapter two we have literature review of the topic we chose, framework component and
theoretical groundwork will be presented. There needs to be four significant factors which can
affect the employee turnover in Malaysia.
Finally, chapter three includes the methodology of the research that would be applied in the study
which includes research design, research hypotheses, research equation, measurement, and data
collection method and data analysis.
(1.8) SUMMARY:
Usually, chapter 1 includes a common indication on the structure of the research. It contributes
as a principle and provides an enhanced considerate for the readers before ongoing to the next
chapter which will additionally discuss the central part of study on the basis of literature review.
This chapter also includes the importance of the contributions of the study. The final element of
the chapter delineates the scope of the study and content of each of the chapters.

CHAPTER NO.2
LITERATURE REVIEW:
(2.1) INTRODUCTION:
In the following chapter, we will be starting up with the excessive research of the employee
turnover in Malaysia. Literature review will help us defining our topic of the employee turnover
with the four reasons which are been specified in chapter one which includes discriminative
factors at the workplace, low salaries, job dissatisfaction and the workplace environment. This
chapter would be on the basis of different theories and the models regarding employee turnover
in Malaysia in different organizations. Literature review would be related to the first chapter
which was the previous research. Theoretical framework would be designed in order to show
stronger pictures of the variables. At the end of the chapter, would be four research hypothesis
which purposes for the development of quantitative analysis.
DEFINING TOPIC:
(2.2) EMPLOYEE TURNOVER:
For decades, investigator and business people alike comprehend that the first contact that
employees have with an organization after being hired is decisive for their accomplishment in the
place of work (Buchanan, 1974). The phenomenon of employee turnover in the organizations is
always focused by the managers and the intellectuals because an employees attitudes and
behaviors play a fundamental role in the progress of the organizations.
And this problem has many connections with an employees working satisfactory and
organizations support. Locke (1969) points out the concern of employee dissatisfaction have
been measured in several studies. Coulter and Robbins (1996) declared that employee
dissatisfaction is an employees specific attitude towards his/her work, and when people address
of an employees behaviors and attitudes, they are expected to be referring to his/her employee
dissatisfaction. The current research addresses operational dissatisfaction from all organizational
perception. This study focuses on employee turnover and job dissatisfaction and how

organizations can enhance their workers employability orientation, that is, their honesty to
adjust to changing work necessities through flexible and broader skills and a willingness to
change jobs (Van Dam, 2004).
"Employee turnover is a ratio evaluation on the number of employees a company has to
substitute in a specified time period to the standard number of the entire employees. An
enormous anxiety and apprehension to most companies, employee turnover is a pricey
expenditure particularly in lower paying job roles, discriminative factors, workplace environment
and job dissatisfaction for which the employee turnover rate is highest. There are many factors
that play a role in the employee turnover rate of any company, and these can branch mutually
from the employer and the employees. Wages, company repayments, employee attendance, and
job performance are few of the factors that play a very major role in the employee turnover.
Companies usually take a profound concern in their employee turnover rate because it is a very
expensive component of doing business." (Beam, 2009) Companies acquire direct and indirect
operating costs, which consist of the advertising cost, headhunting fees, human resource costs,
loss of productivity, new hire training and customer retention, whenever they have to substitute
an employee. These operating costs can sum up to anyplace from 30 to 200 percent of a
particular employee's yearly wage or salary, depending on the business and also the job role
being filled. (Beam, 2009) Potential negative consequences of employee turnover include
operational disruption, demoralization, negative public relations, personnel costs, strategic
opportunity costs, and decreased social integration. (Colema, 1987). Anyhow, the most ordinary
reason for employee turnover rate being so high is the salary scale, and the reason for this is
because employees are typically in the hunt of lucrative jobs. The ones who are frantic for a job
possibly will take the first one that comes alongside to carry them through while searching for
better paying employment. At the same time, employees also tend to leave a corporation due to
the disappointing and insufficient performance appraisals. Low pay is used as a good explanation
when an employee may be lacking in performance or does insufficient work in the organization.
(Rampur, 2009) uneven or second-rate wage structures fall under this category as well. "When
two or more employees perform related or similar tasks and have similar responsibilities,
differences in the pay rate can force lower paid employees to actually give up or quit. In the same
way, if you decide to pay less than the other employers for similar work then the employees are

more liable to make a jump for a higher pay, if the additional factors are comparatively alike."
(Handelsman, 2009)
Because in Malaysia there are a lot of the international races serving the country as being
employees, there are a lot of issues regarding to our factors of the employee turnover. According
to one of the surveys, there have been a lot of problems with the employees who faced racism
factors in the country itself. Employee turnover is a basic problem in Malaysia which cant be
neglected.
(2.2.1) TYPES OF EMPLOYEE TURNOVER:
There are two various types of employee turnover in an organization that several number of
authors have acknowledged the subsequent types of employee turnover:
(2.2.2) VOLUNTARY TURNOVER:
Gomez-Mejia et al (1997) defined voluntary turnover as the division that occurs when an
employee decides for personal reasons to end the relationship with the employer. The choice or
conclusion taken could be based on the employee achieving a better job, shifting career, or
wanting more liberty time for their family or the current job is unappealing and uninviting
because of deprived and improper working environment, low pay or benefits, and even a bad
rapport with the higher administrator. In nearly all cases the choice to leave is a mixture of
having a striking alternative opportunity and being discontented with aspects of the present job.
Sims (2007) approved that voluntary turnover takes place when an employee instigates the
execution of their employment on their own liberty.
Quits is one type of voluntary turnover and it is defined quits as the occurring when an
employee switches or leaves the organization without giving the contractual based period of
notice (e.g. one month). It is frequently an unexpected decision by the employee (Grobler et al,
2002). Therefore, it supposed to be well-known that quits can actually occur at any time and
typically when the organization least imagines it. This can be a very severe collision on the
organizations total act, presentation and production. Even though an organization cannot do a
great deal about an employee quitting but instead, they can actually try to resolve and conclude
the possible reasons for leaving the job or what made them or strike them to make that decision.

(2.2.3) INVOLUNTARY TURNOVER:

Involuntary turnover is defined as the occurrence when organization decides to finish its
relationship with an employee due to financial necessity or a poor fit. Generally, the
organization or the employee cannot take this type of turnover under their control. It is
additionally frazzled by the writers that involuntary turnover can result in a very severe and
agonizing decision or conclusion that can have a deep and thoughtful collision on the complete
organization, especially on the employees who lose his or her job (Mkhize, 1998) admits
involuntary turnover as, when an employee is requested by the organization to leave. Involuntary
turnover basically symbolizes employer-initiated job divisions over which an employee can have
very little or no individual utter, such as removal from office or even getting suspended. Sims
(2007) also admits that instinctive turnover occurs when employment is ended or terminated not
in favor of the wishes of the employees. Those authors from their definitions put pressure on the
fact that with this type of turnover is usually resulted from the employer's choice rather than the
employees choice. It might be some employers who actually wouldnt desire to keep poor
performers or intemperance manpower.
(2.3) IMPORTANCE OF EMPLOYEES:
As we have discussed earlier in our case research that employee is not a person in an
organization to be neglected, but they are the part of the company, going beyond the
contributions in order to achieve the goals of the organizations they are been working in. so as
for the company, its one of the most vital duties for the company to make the employees happy
as much as they can by providing them the best of what they expect. Employee motivation needs
to be restored in every company where there would be no unhappy sign of an employee. More
than the customers, company should think about the employees who are working in the company
expecting to achieve the goals and the objectives of the company. The fact is not only about that
the employees are getting paid for the work they are doing, but its also about the struggle, hardwork, contributions, ideologies and thoughtfulness. It is very logical to think that when an
employee would not be happy with the company, then how that employee would be able to give
its best and when an employee wont be able to give its best, then how that company would be
able to achieve what it wants.

Employees need to feel that they are good at their jobs; they look forward for confronting each
other feedback from their managers. This ought to additionally include valuable feedback
expected to address issues and offer employees some assistance with performing and presenting
their jobs more efficiently. While having formal presentations and performances ought to be a
piece of your progressing strategy, intermittent surveys and unrehearsed sessions will give your
workers the feedback they have to succeed. Employees need to feel that they are being listened,
and all the more so in group environments. Energize feedback. This will offer them some
assistance with feeling that their opinions matter and they have a part in defining the
achievement of your business. Set a positive tone. The quality of any organization starts at the
top and flows down; you must motivate your representatives to have and create a positive
domain. This can be refined by utilizing straightforward procedures from requesting that your
receptionist welcomes everyone with a grin, to urging workers to express their thoughts
transparently. The importance of representative motivation can't be down-played. Ultimately
when workers are motivated this builds efficiency, brings the rate of turnover down, and
improves general execution.
(2.4) DEFINING THE ELEMENTS:
Well as we know that employee turnover is a major problem in every organization nowadays and
behind every problem there is a reason. There are few of the elements which will help us in
defining the main factors of the employee turnover. This framework will make the research more
specified towards the researching factors of employee turnover.
(2.5) JOB DISDISSATISFACTION:
Currivan has pointed out to facilitate job dissatisfaction that it is possible to be the most
extensive research subject about work behaviors over the last thirty years in 2000. Consequently,
job dissatisfaction is not bizarre for the reader. A huge number of investigators are investigative
on job dissatisfaction, but they accomplished few conclusions that the results were a bit different
from one another. Boran (2011) pointed out that job dissatisfaction is basically how people
experience about their jobs in dissimilar aspects. It is the level to which people are fond of
(satisfaction) or hate (dissatisfaction) their jobs. Comparable, job dissatisfaction is defined as the
level to which employees dislike their job by Price and Agho in 1992. On the other hand, the

most extensively accepted clarification of job dissatisfaction as an agreeable or negative

affecting state resulting from the review of ones job or job understandings (Austin, 2007 and
Droussiotis; Locke, 1976). Moreover, Lim (2008) recommended that job dissatisfaction had
major persuade whether individual or a company. On the converse, when employees are not
happy, they tend to quit and look for satisfaction somewhere else. It may results in employee's
variety of response, no matter be emotional or psychological (Park and Joo, 2010). The most
frequent is the employee turnover (Beecham et al., 2008). But some persistently ambiguous
about job dissatisfaction is worthy to disagree. One such fallacy is: Syptak, Marsland and Ulmer
(1999) point out, that an unhappy employee is a destructive employee, may direct to job
dissatisfaction.
The perceptions of the employees in Malaysia on job dissatisfaction disclose the differences with
those of Singapore and the United States. With the similar or same job dissatisfaction
measurement, Simonetti and Weitz (1972) discover that individuals attitudes towards job
dissatisfaction works actually fluctuate according to job levels and profession. Conversely,
Employees in Malaysia and their entire job satisfaction is initiated to be the lowest amongst the
three groups, other than this, the difference may also be due to sector variations, for example,
Malaysian manufacturing sector vs. US public and non-profit and Singaporean public and private
sectors.
General researches have revealed that the Mobley model (1977) which resolute and explains how
dissatisfaction of job can direct to job turnover, surrenders seven successive stages connecting
turnover rate and job dissatisfaction(Lee, 1988). Mobley believed that dissatisfaction of job can
result in career change thoughts and has appraised the benefits when in search for another job,
taking into thoughtfulness the expenditure of leaving or quitting the job from an organization,
employees who hunt for other employment assess the new job for satisfactoriness, lastly, an
employee compares the substitutes with the existing job which also leads to the intent to quit
causing definitive employee turnover rates (Martin, 2011; Lee, 1988). For further
acknowledgment and information the figure below will demonstrate Mobley model (1977) idea.

Source: Mobley model 1977.

(2.6) DICRIMINATIVE FACTORS:
Well in some of the companies there are a lot of problems with the employees working in. But at
the same time some of the problems lead to an end to an employees job. The problem of
discrimination is almost every part of the world in the organizations and especially where there
are employees from different countries. Discrimination can be in different ways like sexual
harassment, age factors, religion and belief discrimination and race discrimination. So step by
step we can thoroughly go through the types of discriminative factors.
1. Sexual harassment:
This kind of discrimination happens where there are the female employees working in the
company and they are been harassed by the opposite gender. This may lead not only to quit the
job for the employee but also there is an insecure environment takes place which affects the work
place environment also. There are few of the cases in United States, where a legal action was
taken.
2. Age factors:
It is illegal to harass a human being because of his/her age. Harassment can contain, for instance,
unpleasant or insulting remarks concerning a person's age. Even though the law doesn't forbid
trouble-free teasing, discourteous remarks and statements, or isolated happenings that aren't very

severe, harassment is against the law when it is so common or cruel that it creates a aggressive or
unpleasant work atmosphere or when it concludes in an unfavorable employment choice like as a
victim being fired or demoted. The harasser can be the victim's manager, a manager in another
part, a colleague, or an important person who is not an employee of the employer, such as a
customer or client.
3. Religion or belief discrimination:
When it comes to religion, there are a lot of cases we can see in workplace surroundings that
people from opposite religions are not being good with one another. In Malaysia, in local
companies there is an atmosphere of religion discrimination in the work place but in the multinational companies we see that there is a normal and a peaceful environment. So the fact in
Malaysia there is discrimination in the sense of religion is quite often because the rate of
foreigners in Malaysia is really high but the employees working in the organizations are not
happy with attitudes of their colleagues with the reason of religion or belief discrimination.
4. Race discrimination:
Race discrimination is a reason because of where the countries having discrimination factors
result in employee turnover when it comes to organizations and employees working there. Racial
discrimination varies employee to employee. The attitudes of the employees from one another
define the main work place environment. It sometimes become uncontrollable to handle such
discrimination because even though there is law enforcement against racial discriminative factors
but still people keep negative thoughts about their employees and colleagues. This factor cant be
neglected when this becomes a severe problem in an organization.
(2.7) LOW SALARIES:
Employee when comes to find a job, he/she always seeks for a better job which will help in the
contributions of the future career of that employee. First job is always totally fine for an
employee as its the start of the experience of the professional life, but by the time when an
employee feels the urge of having a better job with improved abilities, now this is the time comes
when employee seeks to find a better job than the current one. This only happens when an
organization does not value their employees and keeping them on job with fixed salaries or low

salaries. The intention of employees to quit the job begins with the thoughts that they are not
being valued or motivated in the company they are working in. This is the time where employees
start to switch or quit their job.
(2.8) WORKPLACE ENVIRONMENT:
Work place environment plays a vital role in satisfaction of an employee. It is very obvious in the
researches that in some organizations, employees are happy from everything except the work
place environment. When the employees are not comfortable with the workplace environment;
that means that now it is the necessity for them to work in the same organization. The employees
who can find another job they then take the step and switch which affects employee turnover in
that particular organization.
Stress of the workplace environment among employees and their turnover target has always been
significant problems for managers. Researchers have attempted to respond the question of what
establish people's intent to quit by examining achievable background of employees intentions to
leave. (Firth et al. 2004) recognized that the understanding of job connected stress; the variety
factors that direct to job related stress and work place environment make employees to leave the
organization. An unbalanced, unsecured work environment that incorporates job safety, stability,
routine justice diverge the employees level of satisfaction, with the stress at the workplace and as
an outcome boost their turnover plan (Baloch and Ali, 2008). (Mano & Shay, 2004) disagree that
economic insecure circumstance of employees produces stress between them and they frequently
quit from the company due to financial so that a better opportunity could be searched. Role
stressors at the work place also direct to employees turnover. This results in ambiguity about
what the position should be. It can be an outcome of misinterpretation what is estimated, how to
meet the expectations or the employee idea that the job should be different (Kahn et al, 1964).
Inadequate information on how to carry out the job satisfactorily, uncertain expectations of the
top management and supervisors, all kind job pressures, and lack of agreement on duties or job
functions may grounds employees to feel less concerned and less happy with their careers and
jobs, less dedicated to their organizations, experience stress and ultimately display a tendency to
leave the organization (Tor et al, 1997). Lack of job safety and position difference among
employees and the same stage also reasons stress at the work place environment which may lead

their purpose to leave the organization (Brook, 1973; Kahn, et al. 1964. Gunderson & Erikson,
1972 ;)
(2.9) PETER AND EDWARD LAWLER'S EXPECTANCY THEORY (1969):
Edward Lawler III and Lyman Porter enveloped an expectancy hypothesis of motivation that
comprehended Vroom's expectancy theory. So basically this theory is picked over to identify
the basis of people's expectancies and valences and link the effort job satisfaction and
performance. There identified few of the key variables which are predictors of effort and
predictors of reward and satisfaction, predictors of performance (kreitner and Kinicki, 2001).
1. Predictors of effort:
Effort is a purpose of supposed value of reward which corresponds to the reward's valence and
the supposed attempt to reward possibility. Employees will demonstrate more effort when they
consider that they will take the delivery of values rewards for task achievement.
2. Predictors of performance:
Performance is indomitable by further than effort. The affiliation between performance and effort
is dependent on an employee's role perceptions and traits skills which is, the employees with
superior abilities achieve superior performance for a specified level of effort than employees
with less capability. Likewise, effort results in superior performance when employees noticeably
understand and are happy with their given tasks and roles. This occurs for the reason that effort is
direct into the most significant job tasks or activities.
3. Predictors of rewards and satisfaction:
Employees take delivery of both extrinsic and intrinsic rewards for presentation. Intrinsic
rewards are self- established and consist of insubstantial such as an intelligence of achievement
and accomplishment. Extrinsic rewards are substantial results such as public recognition and pay.
In turn, job satisfaction is resolute by employees' awareness of the impartiality of the rewards
established. Employees are more pleased when they feel justifiably rewards. Lastly, employees'
upcoming effort to incentive probabilities is prejudiced by passive understandings with rewards
and performance.

(2.10) THEORY X AND THEORY Y:

Theory X and Theory Y symbolize two differing ends of the incentive spectrum. Theory X puts
onward the principle that employees are intrinsically reluctant to work and must continually be
aggravated from external sources. Theory Y puts forward the thought that employees can be
internally motivated at the work place, finding fulfillment in determination to achieve goals that
use their skills and knowledge. Neither Theory X nor Theory Y is intrinsically enhanced than the
other. Rather, the suitable theory depends on the work surroundings and particular employees
you are dealing with. Applying an incorrect theory in your work place can dissatisfy, confound
and worsen the employees, resulting in to increased employee turnover. A group of employees
that sees autonomous and self-motivation decision-making as significant, for instance, is not
expected to stick around in work surroundings that incorporate strict management at all times.

https://ggfablog.files.wordpress.com/2013/04/theory-x-and-y.jpg
(2.11) HIERARCHY OF NEEDS:
Maslow's hierarchy of needs hypothesis stabilize employees' needs into five progressive types,
opening with essential progressing up needs and physical needs for personal growth and career
improvement. Maslow states that employees should meet each and every level of employees
needs for employees to really consign themselves to workplace objectives and goals.

Weakening to assemble employees needs at any level in the hierarchy can generate a lack of
completion in employees' skilled lives, causing them to ultimately try to accomplish such needs
of their own, probably by finding a new employee who presents better opportunities. (Braga, J.,
Proena, T. & Ferreira, M. (2014).)
(2.12) EXPECTANCY THEORY:
The expectancy theory puts forwards the principle that employees will put forward a quantity of
work and dedication equivalent to what they anticipate to accept in return. Commission payment
structures influence this theory by permitting the employees to be paid as much money as they
wish, totally based on their job dedication and performance. Making certain that employees
always are expecting future pay rises and potential job incentives, motivations from the top
management and promotions can keep them dedicated and working hard to accomplish personal
goals. If employees anticipate little payments and no development opportunities in return for
their contributions and work, they may put forward only minimum effort until they ultimately
look to a new company for new and some better opportunities.
In Malaysia employees some of the employees are been working so hard in order to get the
incentives and achieve the goals and objectives at the end of the day, but because of racism they
get less as compared to the local employees who are not that even dedicated towards their work.
Racism at the work place for an employee can only be tolerated when there is a necessity for an
employee to work in that particular company.
According to (kreitner and Kinicki, 2001), it has been concluded that the expectations of the
company and the expectations of the employees of that company should result in equality. This
will help the company and the employees to be happy with one another. When there is a
fluctuation in the expectations of the company and the organization, then there is one reason that
either the company is failed or employees to come up with the expectations of one another.

(2.13) PROPOSED FRAMEWORK:

The relationship between the four factors and the employee turnover is shown in the figure
below:

Figure (1): Framework for Establishing Employee turnover.

The figure shows two kinds of variables we have presented in the study from which one is
dependant and the second is independent variable. Dependent variable is the employee turnover
and on the other hand independent variables are job dissatisfaction, discriminative factors, low
salaries and the final one is the work place environment. These four factors or variables are
known as the independent variables as they can lead to the employee turnover.
(2.14) CONCLUSION:
Well we have gone through few of the outlines where there are a lot of evidences by the generals
took place in order to identify about the facts and figures of the main reason of the employee
turnover. We have concluded that the factors we have which are affecting employee turnover
happenings are truly right and authentic. In order to make it clear, we first clarified the
importance of the employees in a company so that we all know what an employee is for a
company. Secondly, we have described the main factors which reflect the unhappiness of the
employees by which they intend to quit a job as in other words it can be said as employee

turnover. Lastly, we proposed a framework where there were dependant and independent
variables. Independent variables, we carried out four factors which are affecting the dependant
variable.
Since the start of the study, we are talking about the main factors influencing employee turnover.
The importance of the employee turnover is explained so that it can be clarified that employee in
a company is that important as how that particular company is important and both subjects cant
be neglected.

CHAPTER 3
RESEARCH METHODOLY
(3.1) INTRODUCTION:
In this chapter, quantitative factors will be discussed. It is based on the methodological study as
in data analysis, conceptual framework and data collection methods. Data collection method
includes references, journals and research papers. Data collection method and sampling method
will be determined through conducting a survey. Finally, data analysis would be presented in
order to show the clarified results.
(3.2) RESEARCH HYPOTHESES:
On the basis of the researches we earlier did, factors affecting employee turnover in Malaysia the
following hypothesis is been proposed. This will help us concluding the main significance of the
topic.
H1: There is a particular relationship in between job dissatisfaction and employee turnover in
Malaysia.
H2: There is a particular relationship in between discriminative factors and employee turnover in
Malaysia.
H3: There is a particular relationship in between low salaries and employee turnover in Malaysia.
H4: There is a particular relationship in between work place environment and employee turnover
in Malaysia.

(3.3) RESEARCH EQUATION:

The equation resulting on the basis of factors affecting employee turnover in Malaysia;
ET = c + JD + DF + LS + WE + e
Whereas;
AI = Employee Turnover
C = Constant
JD = Job Dissatisfaction
DF = Discriminative Factors
LS = Low Salaries
WE = Workplace Environment
e = Error
(3.4) OPERATIONAL DEFINITION:
Operational definition can define the dependant as well as the independent variables as in more
clarified sentence which will help us make the questionnaire in an appropriate way.
DEPENDANT VARIABLE:
(3.4.1) EMPLOYEE TRUNOVER
Well employee turnover earlier we have mentioned about employee turnover. It is actually an
employees intention to quit the job in order to find another one with some specific reasons
behind it. Employee turnover can be definite by Price (1977) as the set of employees across the
margin of an organization. According to (Mobley, 1982), he defines that turnover is the voluntary
termination of membership in an organization by an employee who receives financial reward for
contributing in that organization. This explanation emphasizes voluntary performance because
the most important turnover representation seeks to give details what inspires employees to leave

the work place. Additionally, this perception focuses on division from an organization and not
consists of transfer, accession, or other inner movements throughout an organization.
Furthermore, there are numerous definitions in same viewpoints from many writers as Miller
(1996) and Van der Merwe declared that turnover of employees is an everlasting abandonment
and also the purpose of the interpersonal work relationship. The writers also highlight that there
should be a healthy relationship in between the environment, agencies and worker. If this
relationship is not available or present, turnover will definitely occur. This relationship is
measured as enveloping. It can be exaggerated by any or all aspects of the job circumstances,
both internally and externally of an employing organization. (Lane, 2001) defines employee
turnover as the end result of both layoffs and quits additional defines that several turnovers are
the result of jobs in one firm being shattered and opportunities in another firm being formed and
therefore due to the reallocation of jobs crossways the financial system in reaction to changes in
product command.
INDEPENDENT VARIABLES:
(3.4.2) JOB DISSATISFACTION:
Not everybody can be happy with their job. As a subject of fact, a survey was conducted by
Right Management in 2012 and 65% of the individuals that were surveyed were moreover fairly
or entirely unsatisfied with their jobs. Now, there might be a thought that there is actually a
problem here in the Malaysia; however, it is actually worldwide problem. In a Mercer study of
30,000 workers worldwide, sandwiched between 29% and 57% of employees around the world
wanted to put down or leave their jobs.
With all these gloomy and unsatisfied people, there are chances that one would think that there
has to be causes that constrain and oblige these high percentages. Furthermore, one also has to
consider and think about the effects or responses from employees that do not have job
satisfaction at all and how they are going to act (or act it out) on the job. When we are younger,
we make a move by showing displeasure or tramping our feet, even holding our breath, however
it is important we understand how employees respond or act when they are not satisfied with
their jobs. Understanding their responses can actually help organizations or companies to

recognize that dissatisfaction and unhappiness and then optimistically and confidently tackle it
sooner before it literally goes out of hand.
(3.4.3) LOW SALARIES:
The job determines the salary and the categories. The job they got is determined by their
education level. Most Malaysian employees got 11 years of education and on the off chance that
they enter the job advertise immediately as unskilled may win the lowest pay permitted by law of
RM900, every month. A person who put another two years of education to win an exchange
certificate may procure two or three hundreds more to RM1100 or RM1200. At the rate of
increment at 6% it may take years for them to acquire the normal salary for this gathering at
RM2000. They are the low income classification living in government pads, riding motorcycle
and spending hours at workplace with a specific end goal to win additional extra minutes to
maintain life at destitution level. On the off chance that they are self employed, they are the
unimportant brokers, little ranchers and anglers.
The middle income is ordinarily graduates and their level of compensations begins with their
kind of jobs and where they work. A beginning pay would around 2000 and at the incremental
rate of 6% it takes years to develop to the normal salary of 4500.They are committed with study
advance of on the normal of 60000 and can scarcely spare, what all the more purchasing a
connection house which now cost around 500000, They have probably to need to lease a house
for whatever is left of their life and drive 5-6 years of age auto. They are in the low middle
income executives in government and private areas. In the wake of putting over 10 years of work
they may raise to end up administrator and their income would be about RM10000 on the
normal. At that point they may be 40 and may have a connection house whose home loan them
couldn't pay up upon retirement and a large group of different responsibilities. They are in the
upper middle income classification. In the event that they are self employed they are genuinely
fruitful contractual workers, merchants, representatives and palm oil ranchers of sizable grounds.
The high income classification would have an income of 20000.There are relatively few jobs
with this income probably senior supervisors of medium and huge organizations. On the off
chance that they are self employed they may owe a fruitful endeavors, a temporary worker,
having palm oil manor and acquired heaps of landed properties .They don't need to stress over
cash, however there are just a couple of them in Malaysia. Notwithstanding the desolate situation

of low and middle income, they by one means or another figure out how to carry on with an
existence that suits their level of income helped by thrift, family helping one another and an
uplifting demeanor of good future.
(3.4.4) DISCRIMINTAIVE FACTORS:
The factors in Malaysia regarding employees and employment are itself a very definitive topic to
be discussed. There are a lot of international employees who seek to get a better opportunity in
Malaysia. A person if transferring from one country to another perceiving to find a better
opportunity means that the country should come up with the expectations of that specific person.
But the problem in Malaysia with domestic firms is that the companies that are working
domestically are that there is racism among employees if they are from different countries.
People even Malaysians working in the same organizations have discriminative factors in
different phases like color, religions or belief discrimination or politics. So the main point is that
this is a factor can easily cause employee turnover. An employee can have an intention to quit the
job because of the reasons that an organization has discriminative factors.
(3.4.5) WORKPLACE ENVIRONMENT:
The workplace environment plays a vital role in order for an employee to be comfortable in the
company. Flexibility is also very significant when it comes to work place environment.
Interpersonal relationship among employees varies employee to employee. There can be politics
in the company as if one employee is being promoted over to the position which is superior from
the position the other employee is on. So the part of the discussion is when there is no stability in
the relationship of the employees with one another, than there can be a reason that the work place
environment in the organization is being fluctuated for which the top management ought to take
an action. Whenever, an organization faces employee turnover that means that there are some of
the reasons that can be low salaries, discriminative factors, politics or bad work place
environment. LaSala, C.A., Bjarnason, D., (Sept 30, 2010)
(3.5) MEASUREMENT:
Measurements are based on the study research which has been conducted before in this report. In
the following tables, independent and dependant variables and also the sources are been taken.

(3.5.1) INDEPENDENT VARIABLE:

Variable
Job

Item
1. Job dissatisfaction can easily high up the

Source
(Joo and Park, 2010).

dissatisfaction

employee turnover rate in an organization.

2. Adjustability in an organization for an

Syptak, Marsland and

Ulmer (1999)

employee can only be made possible when

there is flexibility at the work place.
3. It also depends on interpersonal
1.
Low Salaries

relationship between employees.

Low salaries and the work load can make

the employee a bit de-motivated.

2. Employees who observes their
contributions are not been appreciated
may cause some negative intentions
towards their job.
3. An employee would also go for the best

Ahad, Abdul (2013-1121).

Hewlett, LK (22
September 2014).

hed be offered. Organizations paying low

salaries will face employee turnover.
Discriminative

Rouse, Cecilia; Goldin,

factors

Claude (2000).
1. Discrimination is one of the most
disappointing factors a company could

Riach, Peter B.; Rich,

Judith (199192).

ever face.
2. It can directly lead to high employee
Workplace
Environment

turnover rate.
3. Discrimination has several types like
racial, religion or belief or sexual

Neuman, J.H. (1996).

harassment.

Kelloway, E.K. (2002).

1. Work place environment can affect

2.

Rai, S. (2002).

employee productivity.
Politics is another reason of bad

workplace environment.
3. If employee feels uncomfortable at the
work place environment, itll make an

employee look for another opportunity.

(3.5.2) DEPENDANT VARIABLE:

Variable

Employee
turnover

Item

Source

1. Employee turnover can cause a lot of financial costs

Beam, J. (2014,

to the company.
2. Most of the time in the company where there is

December 25).

some major problems where some employee cant

get stabled and the turnover rate turns high.
3. 25 percent turnover rate means one-quarter of the
companys employees are not happy at end of the

James L. Heskett
(1991-04-15).
Ruby, Allen M.
(January 2002).

year.

(3.6) DATA COLLECTION:

The information about the population from where the questionnaire survey would be conducted
and the sampling designs would be discussed in this topic.
(3.6.1) TARGET POPULATION:

The target population for a study is the whole set of units for which the study data are to be used
to make the deductions. Therefore, the target population classifies those units for which the
findings of the survey are meant to generalize. Establishing study objectives is the first step in
preparing a survey. Defining the target population should be the other step. Target populations
must be especially distinct, as the definition determines whether sampled cases are ineligible or
eligible in order to conduct a survey. (Niewenhuizen, et al. 2000).
The targeted population is the people from over Malaysia, who have experienced or who are
experiencing their jobs. By choosing targeting such population, it will help us give authentic
information and acknowledgement about the work experience in Malaysia so that there wont be
any kind of controversy over talking about the general facts and figures of Malaysia.
(3.6.2) SAMPLING TECHNIQUE:
Sampling is defined as the respondents, survey and the location where the event is going to be
held. We are going to do the purposive survey which means that there would be specific number
of people who are been chosen to perform the survey. It can be people from any organization of
Malaysia, where they can answer to our surveys about the experiencing of their jobs and the
work place environment.
(3.6.3) RESEARCH INSTRUMENT QUESTIONNAIRE ADMINISTARTION:
Research instrument is based on some survey questions which will be made in the study.
Actually questionnaire helps in identifying the main issues and coming with some of the
solutions and alternatives. So basically what we have to do is that whatever we have talked and
explained about the employees and the employee turnover in Malaysia, we will prepare a survey
in which there would be few questions asked from the people we targeted for it. By this we will
be able to accurately identify the problems regarding employee turnover and the solutions about
what can be done for it.
(3.7) RESEARCH APPROACH:
(3.7.1) DATA ANALYSIS:
A data analysis is a process in which there is assessing data of every element using logical and
analytical interpretation. There are different types of examination method that can be used to

study the truthfulness of the data acquired right through the research. The data collected are
entered into the database and inspected using a system named Statistical Package for the Social
Sciences (SPSS) version 22. System called SPSS is selected for the research in analyzing the
survey which means, occurrence and data consistency.
(3.7.2) RELIABILITY OF DATA:
According to William M.K. Trochim, assessing the excellence of research is vital if findings are
to be operated in incorporated and practice into care delivery. The aim of this object is to further
summarize severity, or the honesty in which a survey is conducted, and make sure the
dependability of findings in relationship with qualitative research. Concepts such as validity,
generalize ability and reliability typically linked with quantitative research and substitute terms
will be compared in relationship with their request to qualitative research. Furthermore, some of
the strategies approved by qualitative researchers to improve the trustworthiness of their research
are summarized.
(3.7.3) NORMALITY:
A normality test is used to study the quantity of giving out data matches to the usual distribution
(Hair, et al., 2005). The shape of variable frequency distribution supposed to be roughly
approximated to a bell-shaped curve.
(3.7.4) LINEARITY:
Supposition that the research variables are connected to one another in a linear way which is the
disperse plot is a straight line. The Pearson correlation coefficients evaluate the quantity of linear
relationship between both of the variables (Hair, Anderson, Tatham, & Black, 1998).
(3.7.5) MULTIPLE REGRESSION ANALYSIS:
Multiple regression Analysis is used in shaping the connection among the single dependent
variables and multiple independent variables.(Sekaran, 2003). They are made by creating a
statistical regression which is symbolized by r square. The equation is been made to forecast
and clarify the connection between the employee turnover and the factors which affect it. The
examination also can describe the factors that significantly influencing the dependent variable.
Therefore, r is the dimension of connection between the experiential value and predicted value

of dependent variables whereas r square methods the quantity of difference in dependent

variable that is summed by independent variables (Cohen , Manion, & Morrison, 2013).
(3.8) CONCLUSION:
This chapter shows the main methods to conduct a survey by providing research hypothesis,
sampling, targeting population, research equation, data collecting and the data analysis methods.
Well this study has been concluded with the facts and figures about the employee turnover in
Malaysia. Acknowledgements and information are been provided with full evidences and
references so that the case will be carrying out no controversies and inappropriate subjects
regarding the study.

QUESTIONNAIRE ON EMPLOYEE TURNOVER BASED WITH THE FACTORS OF

JOB DISSATISFACTION, LOW SALARIES, DISCRIMINATIVE FACTORS AND
WORKPLACE ENVIRONMENT IN MALAYSIA

Kindly please put a

QUESTIONS
1. What do you feel about the working

for your answer you choose.

POOR

AVERAGE

GOOD

VERY GOOD

environment in your company?

2. How is your package given to your
by your company?
3. How is the behavior of the
employees in your company?
4. What would you rate for the
discriminative factors in your
workplace?
5. Whats your satisfaction towards
your job?
6. What is the rate of politics in the
company you are working?
7. Are you happy with your levels in
your company?
8. Is there flexibility given to your at
your workplace?
9. Are there support programs and
orientations given to you in your
company?
10. What is your overall perception
about working in Malaysia?
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