1. Background of the study
Name the greatest accomplishment of the last century. Landing on the moon?
Computers?Biogenic engineering? Cloning of life forms?And what awaits us in
the new millennium?Routine travel to distant planets?Human longevity
unimaginable in the past? Working and shopping without ever stepping out of our
homes? Growing our own food in the kitchen? Flying to any destination of our
choice in automatically piloted flying cars? Living in undersea settlements? The
possibilities are immense. Indeed, our future achievements may be limited only
by our imagination. All major achievements and technological advances have a
common feature: organizations(The Strategic Human Resource Management
Mode, 2007).
The warehouse receives material from many plants. Then the material will be
consolidated to supply to a single customer or a single destination. The
warehouse receives materials from the manufacturing industries to supply to a
number of customers. It breaks the bulk material into smaller packages and
supplies it to individual customers and helps in final processing such as labeling,
finishing touches, etc. Especially,storing is essential for seasonal goods. If the
demand is in a particular season, industry can do manufacturing throughout year
until the right time comes.
(http://www.wtgnews.com/wp-ontent/uploads/2010/08/supply_chain_diagram.jpg,
Accessed: 20 September 2013)
1

2. Company resources are men, material, machine, money, method, information,
and Time. Compare to other resources only people are active, organize, and
make decisions on other resources, but behavior is complex and unpredictable.
Without people nobody can run a business, no business can survive, and no
business can grow.
SubhirChowdhury has described the successful 21st-century organization will not
take the loyalty of talented people for granted. It will constantly try to recruit and
keep them. … The mutual commitment of an employer and an employee will be
one of the most an important factor for a 21st-century organization(The Strategic
Human Resource Management Mode, 2007).
We have identified a family consist of three (parents and son or daughter) per
month cost of electricity bill minimum 2,500, water bill minimum 1,500, and 3
meals Rs.21, 600.There are many more expenses: telephone bills, saloon
expenses, clothes, washing powder, etc…
2

3. Researchers have identified in Mahinda Palalogistics industry a warehouse
assistant’s per month basic salary is about Rs. 7,500, attendance bonus Rs.1500
(1 days absence full amount is paid, 2 days absence – 50% is paid and over 2
days - no payment), and Quarterly Retention Bonus of Rs.1500 (after every 3
months receive) and over Time 1.5 X hours worked.
(http://2.bp.blogspot.com/cv5HWzqYg8/URMDrQIVqnI/AAAAAAAAFJY/FQkFtRZBwCw/s1600/Suicide_in_
srilanka.jpg, Accessed: 25 September 2013).
Awarehouse worker should be energetic, skill on Reach Trucks and Fork Lifts,
and like to works in a highly mechanized environment.
There were 3.7 million job openings on the last business day of July, little
changed from June, the U.S. Bureau of Labor Statistics reported today. The
3

4. hiresrate (3.2 percent) and separations rate(3.0 percent)(separation rate means
total turnover rate) also were little changed in July (Bureau of labor statistics U.S.
department of labor, 2013).
A significant labor turnover rate of 64% hasin Mahinda Pala Logistics Industry.
There for this research forces on that particular topic.
Research problem
The knowledge lost from a departing employee is not a short-term Problem; it is a
long-term problem that breeds other problems and reduces an organization's
effectiveness. The employee can take with him relevant knowledge, needed to
even operational and ongoing organization activity (Filipe and Luis, 2012, p.157).
This research is aimed at the factors affecting to labor turnover and its impact on
organization performance with special reference to Mahinda Pala logistics
industry.
Research objectives
4

5. 1. To reduce factors affecting to labor turnover
2. Toestablish health and safety practices and mitigate hazards
3. To provide health and safety equipment
4. To offer competitive salary
5. To establish Work Schedule Flexibility
6. To increase performance of the organization
Research Questions
(http://irwanfazri.hubpages.com/hub/The-Causes-of-Accident-At-Work-Claim,
Accessed: 19 September 2013).
What is the current level of labor turnover in this warehouse sector?
What are the factors affecting to labor turnover in this warehouse sector?
What is the relative important of these factors on labor turnover?
Are labor turnover burden problem on this industry and what are the actions to be
taken in order to overcome these problems?
What is the relationship between labor turnover and organizational performance?
Significance of the study
5

6. The findings of the study will help to improve organizational efficiency.
Mahinda Pala can attract employees from competitors because of competitive
salary, work schedule flexibility and safety environment.
Good health and safety practices can reduce industry cost and protect the law.
This research factors will help for government to enact a competitive salary as a
minimum wage for factory workers.
Retailer can provide uninterrupted services for customersand retain their
customers in order to gain competitive advantage.
This research will benefit for future researcher academics and other students for
their studies.
Literature Review
We live in the present. We plan for our future. When you work on your plans,
knowledge about history helps to mitigate risk andprovide intelligence. Then you
can easily achieve your goals.
In history, labors were treated as machines and believed that the environment is
not changing. Before 1771, there was not any theory about labors. Industries
went on experiments to increase efficiency to be effective. People are the key on
those experiments: How reduce unnecessary movements? What is needed to
motivate people? Do workers need a relationship? All were studying about
people for organization’s performance.
6

7. Robert Owen (1771-1858) was a man ahead of his time. During his lifetime, he
endeavored to improve the health, education, well-being and rights of the working
class. This driving ambition to create a better society for all took him around the
world, from a small mill village in Lanarkshire in Scotland to New Harmony,
Indiana in America with varied success (http://www.robert-owen.com/, no date).
According to Charles Babbage 1832 that the master manufacturer, by dividing
the work to be executed into different processes, each requiring different degrees
of skill or force, can purchase exactly that precise quantity of both which is
necessary for each process; whereas, if the whole work were executed by one
workman, that person must possess sufficient skill to perform the most difficult,
and sufficient strength to execute the most laborious, of the operations into which
the art is divided (http://www.adm.fukuokau.ac.jp/fu844/home2/Ronso/Shogaku/C50-2+3/C5023_0119.pdf, no date).
According to F. W. Taylor (1856-1915) devised his system "Scientific
Management"factory leader should develop a standard method for doing each job
using scientific management, workers should be selected for a job based on their
skills and abilities, work should be eliminate unnecessary hand movements, and
wage incentives should be provide to increase efficiency.
Henry Gantt (1861-1919) is the first person to talk,factories should worry about
what they do to the society (corporate social responsibilities) because of the
damages was done by world war to the society.
7

8. Henri Fayol's Principles of Management managers in the early 1900s had very
few external resources to draw upon to guide and develop their management
practice. But thanks to early theorists like Henri Fayol (1841-1925), managers
began to get the tools they needed to lead and manage more effectively. Fayol,
and others like him, are responsible for building the foundations of modern
management theory(http://www.mindtools.com/pages/article/henrifayol.htm#sthash.CvV6fF8v.dpuf, no date).
According Max Weber (1864-1920), bureaucracy is the most efficient form of
organization. The organization has a well-defined line of authority. It has clear
rules and regulations which are strictly followed.
Elton Mayo (1880-1949) founded the Human Relations Movement. Experiments
undertaken by Mayo took place at the Hawthorne plant in the USA during the
1930s. His work illustrated that if the company or managers took an interest in
employees and cared for them, it had a positive effect on their motivation
(http://businesscasestudies.co.uk/arm/motivation-within-an-innovative-workenvironment/mayo-human-relations-approach.html#ixzz2fkHIQeJX, no date).
Abraham Maslow developed
the Hierarchy of Needs model
in order to motivate people.
1940-50s USA
(http://www.strategosinc.com/maslow_hierarchy.htm, Accessed: 20 September
2013).
Challenges for managers in difficult situations and the reality, that human
behavior is complex. This complicated the problem for managers attempting to
8

9. use insights from the behavioral sciences that regularly changed when different
behavioral scientists offered distinct alternatives
(http://www.managementheaven.com/behavioral-approach-to-management/, no
date).
From 1980 to 2000, industries concentrated on input, output and productivity
because of they believed the environment is dynamic.
Output
= Productivity
Input
Beyond 2000, Industries give more prominent to creativity and
Innovation.Industry needs planners and doers because the environment is known
as turbulent.
Human resource management is the process of managing human talent to
achieve an organization’s objectives (Snell, Bohlander and Vohra, 2012, p.04).
The shortage of logistics personnel is not a new phenomenon (Richardson 1989).
For example, driver retention in the motor carrier industry has long been
considered a critical issue. Annual driver turnover rates average 100%, but some
companies are as high as 200 to 300% (Kelter and Ozment 1999a). Retention
rates aren't much more encouraging in the warehousing industry. Annual
estimates indicate that at least 20% and in some cases as much as 75% of all
warehouse workers will leave their job within one year of hire date, and the cost
9

10. of replacing each employee is estimated to be in the thousands of dollars (Gooley
2001; MuiUns,2002; Wilson 2001) (Chad and Patricia, 2003, p.171).
Number of employees who left during the year
(Number of employees at the beginning of the year + Number of employees at
the end of the year
DC manager performance will go down because of higher labor turnover rates.
He cannotable to manage day to day operations without sufficient number of
labors. Top layer people, manufacturing industries and retailers will ask reasons
for slow operation. The labor turnover rateshave a significant impact on DC
manager turnover rates.
Work schedules have become a topic of considerable discussion and
experimentation in recent years, both in the United States and in Western Europe
(Thomas, A.M., 1978, p.31).
12 hours’ work on roaster is one of a main reason for labor turnover at Mahinda
Pala logistics according to our research data.
Mike (2013) provided new research has found workers suffer many problems
associated with working 12-hour shifts and rotating shifts. These problems
include a disturbed body-clock, shortened and distorted sleep, and disturbed
family and social life.
According to Mike (2013) tired workers are not militant, they do not stand up for
their rights at work, and they do not organize. Indeed, they never see many of
their workmates on the same sites, all they want to do is sleep in between their
shifts, and all the young workers want to do is party. Thus in one fell swoop, the
mine owners effectively weakened the mining unions, at a very critical time —
when these same unions had come out of the deadly ’70s with many safety
concessions, all since vanished.
10

11. Pierce and Dunham (1992) similarly reported that the implementation of a 12hour roster actually reduced fatigue levels. One explanation for this effect may be
that on a 12-hour roster the workers have extended sleep periods during their
days off. In contrast, Rosa (1991) studied the long term effects of the 12-hour
scheduling using a fatigue battery test. The results indicated that grammatical
reasoning reaction time and auditory reaction time was slower after a 7 month
and a 3.5 year period. Interestingly, there was no deterioration in performance or
alertness during the week suggesting a day to day recover
(http://www.heas.com.au/publications/twelvehour.htm, no date).
Baker, Olson and Morisseau (1994) more recently have argued that the 12-hour
roster may have positive consequences. For example, it may be safer to have
employees work in order to finish a significant task
(http://www.heas.com.au/publications/twelvehour.htm, no date).
However, results indicated that stress and burnout was lower among workers
engaged in all types of formal flexible arrangements, and that 30-50% of
observed differences between workers engaged in flextime (either alone or
combined with compressed workweeks) and those not engaged in a formal
arrangement were explained by perceived flexibility. Evidence also indicated that
11

12. the generally beneficial effect of schedule flexibility differs by gender and the
employment arrangement of a worker’s spouse or partner. Advocates suggest
that workplace flexibility contributes to better health; in part because it helps
workers better balance their work and family lives (Joseph et al., 2008, p.119).
National surveys repeatedly show that workers seek flexibility as the key
response to the competing demands of work and personal responsibilities. Many
corporations with formal flexible work programs have reported positive results,
including increased productivity, reduced absenteeism, and turnover
(http://humanresources.uchicago.edu/fpg/forms/compensation/FlexibleWorkOptio
nsGuide.pdf, no date).
The employer must provide personal protective equipment for employees at work
eg: metatarsal foot protection, non-prescription eye protection, prescription
eyewear inserts/lenses for, full face respirators, goggles and face shields,
firefighting PPE (helmet, gloves, boots, proximity suits, and full gear), hard hats,
and hearing protection. The employer is not allowed to deduct those expenses
from employee salary by rules and regulations. This is a huge cost for the
organization. Because of this expenditure,employerpays a minimum basic salary
for employee.
(http://hoklife.com/wp-content/uploads/2009/02/office-1.jpg, Accessed: 20
September 2013). (http://brewing.cafedirect.co.uk/wpcontent/uploads/2010/02/FT14-OFFICE-TEA-PARTY-490x259.jpg, Accessed: 20
September 2013).
12

13. (http://images.fanpop.com/images/image_uploads/The-Office-the-office556868_1024_683.jpg, Accessed: 20 September 2013).
(http://imgc.allpostersimages.com/images/P-473-48890/21/2164/WJACD00Z/posters/eitan-simanor-warehouse-workers-having-restbreak-at-carrit-moran-company-s-tea-warehouses-at-kolkata-port.jpg, Accessed:
20 September 2013).
Promote openness and communication about safety in your organization. Solicit
Feedback and involve every level of the organization in your safety goals. Safety
committees should consist of individuals from various levels and departments
within your organization. Trust is very important in this process. Employees must
feel as though they can express thoughts and report accidents or incidents
without fear of blame or punishment. A true safety culture promotes the positive
and looks to change or fix the negative behavior (Sara, 2006, p.78).
13

14. (http://patriotupdate.com/wpcontent/uploads/2011/12/People_Working_in_Warehouse_42-19942053.jpg,
Accessed: 20 September 2013).
Watch your employees' backs (and necks and ...): Ergonomic injuries such as
strained backs or necks represent one of the largest threats to your warehouse
employees' health and comfort (Marty, 2007, p.42).
(http://upload.wikimedia.org/wikipedia/commons/3/3f/Sri_Lankan_garment_worke
rs.jpg, Accessed: 25 September 2013).
Likewise, recognizing that health is believed to play a crucial role in workplace
performance and productivity, flexibility also provides a concrete lever to
organizations for enhancing organizational performance (Joseph et al., 2008,
p.119).
14

15. Health is Wealth
(http://floost.com/images/1347976989.8123__396056_365667193511152_83716
8058_n.jpg, Accessed: 20 September 2013)
Agyris (1971) believes that people are inclined by nature to expand psychology
energy towards some purpose and that their personal needs tend to have a
priority over organizational needs. People use their energy to subvert the end
sought by organization if management fails to recognize their needs (Anwar et
el., 2012, p.88).
Basic salary is really important according to Sri Lankan life style for any
employee. For EPF & ETF, employee deducting and employer
contributingarefrom the basic salary. The maximum basic salary will give
maximum retirement benefit. Another advantage is for employee that their
earning per hour is calculating from their basic salary.The maximum basic salary
will give maximum over time. Any bank for a housing loan first considering factor
is his/her basic salary.Earning a good basic is a prestige for an employeein the
society as well.
We have already compared Sri Lanka cost of living and salary at the warehouse
on our background of study.
15

16. Long-term employees or employees with substantial product and service
knowledge are an asset, especially when you have new employees for whom the
learning curve slows productivity. Retaining employees who, by virtue of their
tenure and experience, understand and appreciate the company's philosophy,
processes and policies can become excellent mentors for newly hired
employees. In addition, retaining talent boosts your company's ability to provide
higher quality products and services. Experienced, high-performing employees
who are comfortable with sharing opinions and making suggestions for
improvement can help you develop innovative ways to patent new ideas and
products (http://www.ehow.com/info_7747234_benefits-retainingemployees.html#ixzz2fUdEW8lD, no date).
Becca (2012) provided information about the PartnerIt.com research shows that
some companies go as far as saying it costs at least three times an employee’s
salary to fire and replace a bad hire. That number might seem outrageous, but
some hidden costs that go into hiring and training, include the cost of advertising
on a job website or fees to a recruiter. The time it takes for Human Resources
and staff to review resumes, cover letters, background checks and interview
potential candidates can take away from other parts of the company. It also might
cost a company a lot of money in overtime to have someone do the work while
trying to fill the position.
This research showed labor turnover is affected by basic salary, 12 hours roaster
and health and safety in work environment at Mahinda Pala Logistic. Labor
turnover have a significant impact on organization performance
16

17. Conceptual framework
Basic Salary
H1a
Turnover of
12 hours
H1b
roaster
H2a
operational level
labors
Organization
Health and Safety
H1c
Performance
conditions in work
environment
H2b
H3a
Turnover of DC
manager
Hypothesis
Based on the conceptual framework developed for the research, following
hypotheseswere proposed:
H1a: Basic salary is significantly affecting to turnover of operational level labors.
H1b: 12 hours roaster is significantly affecting to turnover of operational level
labors.
H1c: Health and Safety conditions in work environment is significantly affecting to
turnover of operational level labors.
H2a: Turnover of operational level labors is significantly affecting to Organization
Performance.
H2b: Turnover of operational level labors is significantly affecting to Turnover of
DC Manager.
H3a: Turnover of DC manager is significantly affecting to Organization
Performance.
17

18. Methodology
(http://www.answercoalition.org/march-forward/statements/what-is-natoanyway.html, Accessed: 20 September 2013)
(http://pakpotpourri.wordpress.com/2012/09/08/nato-expansion-onto-globalstage-dangerous-threat-to-world-peace/, Accessed: 20 September 2013)
If we know, where are they coming from? What is their culture? What is their
education? Where are they wanted to be in the future? Then we can determine
who they are, what are they want, how to motivate them.
A self-administered survey questionnaire among selected individuals whose main
job functions: factory, warehouse, apparels and constructionwere chosen as the
mode for data collection.
The response rate was 66 per cent of the original sample. With regard to
demographics of the respondents, 66% were male and 44% werefemale. 47%
were single and 53% were married. 30% from Colombo district which is the
largest city and the commercial, industrial and cultural capital, 23% from Ampara
district located in eastern province, 22% from Jaffna capital city of the Northern
Province, 25% from Galle is a major city in Sri Lanka, situated on the
southwestern tip of Sri Lanka.
The mean age was 30 years. The average number of years of service in theany
factory was one year.53% had G.C.E. Ordinary Level Education,40% had G.C.E.
18

19. Advance Level Education, and 17% had not been school education. 67%
reported that they do not havedependents.
Limitation of the study
A self-administered survey questionnaire among 200 selected individuals from
selected 3 districts whose main job functions in lower level at factories,
warehouses, apparels and constructions was chosen as the mode for data
collection.
Time plan
Activity
Time
Selecting topic and Design the research
2 Weeks
Developing research proposal
1 Week
Literature review
1 Week
Data collection
3 Weeks
Data analysis
1 Week
Preparation of the report
2 Weeks
Total Duration for the project
10 Weeks
19

20. References
The Strategic Human Resource Management Mode (2007) Available at:
http://highered.mcgraw-hill.com/sites/dl/free/0070951764/447763/Chapter01.pdf
(Accessed: 03 August 2013).
http://www.keells.com/about-us.html (no date) (Accessed: 09 September 2013).
Bureau of labor statistics U.S. department of labor, BLS. Available at:
http://www.bls.gov/news.release/pdf/jolts.pdf (Accessed: 23 September 2013).
Filipe, F., Luis, B.G. (2012) Employee Turnover Impact in Organizational
Knowledge Management: The Portuguese Real Estate Case [Online] Available
at: http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?vid=4&sid=88604c5b682e-4149-97d9-49f43a8fbe3f%40sessionmgr104&hid=121 (Accessed: 23
September 2013).
http://www.robert-owen.com/ (no date) (Accessed: 20 September 2013).
http://www.adm.fukuoka-u.ac.jp/fu844/home2/Ronso/Shogaku/C502+3/C5023_0119.pdf (no date) (Accessed: 22 September 2013).
http://www.mindtools.com/pages/article/henri-fayol.htm#sthash.CvV6fF8v.dpuf
(no date) (Accessed: 23 September 2013).
http://businesscasestudies.co.uk/arm/motivation-within-an-innovative-workenvironment/mayo-human-relations-approach.html#ixzz2fkHIQeJX, (no date)
(Accessed: 23 September 2013).
http://www.managementheaven.com/behavioral-approach-to-management/, (no
date) (Accessed: 19 September 2013).
Snell, Bohlander, Vohra (2012) Human Resource Management: A South-Asian
Perspective, India: Cengage Learning India Pvt.Ltd.
20

21. Chad, W. A., Patricia, J.D. (2003) WAREHOUSE OPERATIONS EMPLOYEES:
LINKING PERSONORGANIZATION FIT, JOB SATISFACTION, AND COPING
RESPONSES[Online] Available at:
http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=fd85949f-aeb5-409f9c47-77837daca046%40sessionmgr115&vid=1&hid=121
(Accessed: 23 September 2013).
Thomas A.M. (1978) The Rearranged Work Week: Evaluations of Different Work
Schedules [Online] Available at:
http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=3ab71856-459d-4d5189c1-e2d31e9c44ec%40sessionmgr198&vid=1&hid=119
(Accessed: 23 September 2013).
Mike, C. (2013)Green Left Weekly. Available at:
https://www.greenleft.org.au/node/53879 (Accessed: 25 September 2013)
Marty G., (2007) Keep the Safety Momentum alive: Expert advice on how to keep
employees following safety initiatives [Online] Available at:
http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=e06a08fa-81ae-46c89125-9ec91fc9f8f7%40sessionmgr104&vid=1&hid=113 (Accessed: 25
September 2013).
http://www.heas.com.au/publications/twelvehour.htm (no date) (Accessed: 25
September 2013)
Joseph, G.G., Dawn S.C., Sandee S., (2008) Schedule flexibility and stress:
Linking formal flexible arrangements and perceived flexibility to employee
health[Online] Available at:
http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=d966fd8d-3b68-4d41bda0-c151aefe08cd%40sessionmgr104&vid=1&hid=119(Accessed: 23
September 2013).
21

22. http://humanresources.uchicago.edu/fpg/forms/compensation/FlexibleWorkOptio
nsGuide.pdf (no date) (Accessed: 27 September 2013).
SARA, S.H., (2006) Changing human behavior takes time —and education
[Online] Available at:
http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=6f24aae7-8510-4abaae3e-e95fee105080%40sessionmgr111&vid=1&hid=103(Accessed: 25
September 2013).
Joseph, G.G., Dawn S.C., Sandee S., (2008) Schedule flexibility and stress:
Linking formal flexible arrangements and perceived flexibility to employee
health[Online] Available at:
http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=d966fd8d-3b68-4d41bda0-c151aefe08cd%40sessionmgr104&vid=1&hid=119(Accessed: 23
September 2013).
Anwar, A.S.G.S., Lawal, M.A., Muhammad, B.J., Shaikh, F.M., (2012) Motivation
as a Tool for Effective Staff Productivity in the Public Sector: A Case Study of
Raw Materials Research and Development Council of Nigeria [Online] Available
at: http://web.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=b9d802bd-0b284f34-8ab9-f850367053c9%40sessionmgr112&vid=1&hid=121 (Accessed: 26
September 2013).
http://www.ehow.com/info_7747234_benefits-retainingemployees.html#ixzz2fUdEW8lD (no date) (Accessed: 23 September 2013).
Becca, B. (2012) BeccaBabicz social media professional, Available at:
http://beccababicz.com/2012/05/05/the-hidden-benefits-of-retaining-employees/
(Accessed on 27 September 2013).
22