Voluntary turnover is when an employee chooses to leave: they resign, retire, or take another job. Involuntary turnover is when the employer makes the decision: a layoff, a dismissal, the end of a contract the company chose not to renew. The difference between voluntary vs. involuntary turnover comes down to one question — who decided?
It sounds like a bookkeeping detail. It isn't. The two kinds of turnover have different causes, different costs, and different fixes, and a single blended turnover rate hides all of that. A company with 18% turnover made up of resignations has a retention problem. A company with 18% turnover made up of one restructuring has a different story entirely. This guide covers the definitions, the formulas for each, a worked example, and what to do with the split once you have it.
What Counts as Voluntary Turnover
Any separation the employee starts:
- Resignation for another job, a career change, study, or relocation.
- Resignation for personal reasons such as family, health, or caregiving.
- Retirement. Many companies report this as its own line, since it's voluntary but rarely preventable.
- Job abandonment, where someone stops showing up. Practice varies; most count it as voluntary.
What Counts as Involuntary Turnover
Any separation the employer starts:
- Layoffs and redundancies for business reasons.
- Termination for performance.
- Termination for misconduct or policy violations.
- End of a fixed-term or seasonal contract that the employer chose not to extend.
- Failed probation.
The Gray Areas
Real separations don't always sort cleanly. Decide your rules once, write them down, and apply them the same way every period.
- "Resign or be dismissed." If someone resigned because the alternative was termination, the honest classification is involuntary.
- Voluntary redundancy and buyouts. The employee chose, but only because the company opened the door. Most analysts count these as involuntary, since the company wanted the headcount reduced.
- Mutual agreement. Pick one category and be consistent, or track it separately.
- Internal transfers and promotions. Not turnover for the company. They may count as turnover for a team, which is worth tracking on its own.
- Death and long-term disability. Usually recorded as "other" and excluded from both.
The Formulas
Both rates use the same structure as the overall turnover rate. Only the numerator changes.
Voluntary turnover rate = voluntary separations ÷ average headcount × 100
Involuntary turnover rate = involuntary separations ÷ average headcount × 100
Average headcount is (headcount at start of period + headcount at end) ÷ 2. The two rates, plus any "other" category, add up to your total turnover rate. If you need the basics first, see how to calculate employee turnover rate, or let the turnover rate calculator do it.
Worked Example
A company began the year with 190 employees and ended it with 210. Over the year, 30 people left: 21 resigned, 2 retired, 5 were laid off, and 2 were dismissed for performance.
- Average headcount: (190 + 210) ÷ 2 = 200
- Total turnover rate: 30 ÷ 200 × 100 = 15%
- Voluntary separations: 21 + 2 = 23, so the voluntary rate is 23 ÷ 200 × 100 = 11.5%
- Involuntary separations: 5 + 2 = 7, so the involuntary rate is 7 ÷ 200 × 100 = 3.5%
The headline is 15%. The useful information is that more than three-quarters of it was people choosing to go. If you report mid-year, annualize each rate separately, as we show in annualized turnover rate.
Voluntary vs. Involuntary Turnover at a Glance
| Voluntary | Involuntary | |
|---|---|---|
| Who decides | The employee | The employer |
| Typical causes | Better offer, manager, growth, pay, recognition, life events | Restructuring, performance, misconduct, contract end |
| Predictable? | Only with good signals | Yes — the company plans it |
| Main cost | Lost knowledge and replacement | Severance, morale, reputation |
| What it tells you | How it feels to work here | How well you hire, plan, and manage performance |
What Each Number Is Telling You
High voluntary turnover
People have options and are taking them. The usual causes are management, lack of growth, pay that has fallen behind, and feeling unnoticed. The Work Institute estimates that roughly three in four voluntary departures are preventable, which makes this the number most worth working on. Our guide to the warning signs of quiet quitting covers what to look for before the resignation letter.
High involuntary turnover
Outside of a restructuring, a high involuntary rate usually points upstream: hiring that's too fast or too loose, onboarding that doesn't set people up, or managers who avoid performance conversations until dismissal is the only option. Look at how long dismissed employees had been with you. If most left in their first year, the problem is hiring and onboarding.
Both high at once
Layoffs often trigger resignations. People who survive a cut watch how it was handled, update their CVs, and leave over the following months. If voluntary turnover rises in the two quarters after an involuntary spike, that's the pattern. We wrote about holding a team together through it in recognition during layoffs.
Going One Level Deeper: Regrettable vs. Non-Regrettable
Not all voluntary turnover is bad. A persistent low performer who resigns is voluntary turnover and also a relief. Many HR teams add a second label to each voluntary exit:
- Regrettable: someone you wanted to keep.
- Non-regrettable: someone whose departure you'd have accepted.
Regrettable voluntary turnover is the sharpest retention metric available. It needs honest managers, because every exit feels regrettable in the week it happens and non-regrettable in hindsight. Record the label at the time of resignation.
What Does a Normal Split Look Like?
It varies widely by sector and by the state of the economy. In most years and most industries, resignations outnumber layoffs and dismissals, often by a wide margin; the US Bureau of Labor Statistics publishes quits and layoffs separately each month if you want a national reference point. In downturns the mix shifts toward involuntary, and people who would have quit stay put. For sector figures, see employee turnover rates by industry, and for a view on targets, what is a good employee turnover rate. Related terms are untangled in turnover vs. attrition vs. retention rate.
What Voluntary Turnover Costs
Replacing an employee typically costs 50–60% of their annual salary (SHRM), covering recruiting, onboarding, and lost productivity. Take a 100-person company with a $65,000 average salary and 15% turnover: at 50%, that's about $487,500 a year. If three-quarters of that turnover is voluntary, roughly $365,000 of it comes from people who chose to leave — and much of that was preventable. Run your own figures in the cost of employee turnover calculator.
How to Reduce Each Kind
Reducing voluntary turnover
- Train and support managers. Gallup attributes about 70% of the variance in team engagement to the manager.
- Recognize people regularly and specifically. Employees who feel inadequately recognized are about twice as likely to say they'll quit within a year (Gallup / Workhuman), and strong recognition cultures see up to 31% lower voluntary turnover (Deloitte).
- Show a path. People leave when they can't see what's next.
- Keep pay current with the market, especially for long-tenured staff.
- Run stay interviews, not only exit interviews.
Recognition is the lever we know best, since it's what Propsly does: a free Slack app, ours, where teammates thank each other with /props. The data it produces can also flag teams going quiet, which we describe in recognition as an early warning system for attrition.
Reducing involuntary turnover
- Slow down hiring enough to check for the skills the job needs.
- Invest in the first 90 days. See recognizing new hires in their first 90 days.
- Give feedback early. Most performance dismissals follow months of silence.
- Plan headcount conservatively so growth doesn't have to be undone.
The Short Version
Voluntary turnover is the employee's decision; involuntary turnover is the employer's. Calculate each as separations of that kind divided by average headcount. Report them separately, label voluntary exits as regrettable or not, and put most of your effort into the regrettable voluntary number, because that's the one you can change.