Turnover Cost Model

Senzo’s Turnover Cost Model estimates the full financial cost of a single employee departure by role category. It uses a five-component formula based on published Canadian healthcare benchmarks and collective agreement data.

Cost estimates use Canadian benchmark parameters by default. If your organization has access to actual compensation and fill-time data, entering custom figures will produce more precise outputs. See Cost Analytics for how to override benchmarks.

The formula

C_event = C_sep + C_vac + C_acq + C_onboard + C_prod

Component	Name	What it captures
C_sep	Separation Cost	Administrative and HR costs associated with the departure
C_vac	Vacancy Coverage Cost	Premium cost of covering clinical load during the unfilled period
C_acq	Acquisition Cost	All costs to find and secure a replacement
C_onboard	Onboarding Cost	Cost to integrate the replacement to functional independence
C_prod	Productivity Ramp Cost	Value of lost productivity before the replacement reaches full output

Component definitions

C_sep — Separation Cost

C_sep = (exit_admin_hours × avg_manager_hourly_rate) + severance_applicable

Covers: HR exit processing time, manager time, any applicable severance. Default assumption: 8 hours of combined HR/manager time at $75/hr. Severance applies to involuntary departures only. The base model does not disaggregate voluntary from involuntary turnover.

C_vac — Vacancy Coverage Cost

C_vac = (backfill_daily_rate − base_daily_rate) × avg_vacancy_days

Covers: the premium cost of agency or overtime backfill during the unfilled period. The number of vacancy days varies significantly by role — specialist physicians average 270–548 days to fill; health care aides average 14–60 days.

C_acq — Acquisition Cost

C_acq = search_fee + advertising + interview_time_cost + signing_bonus + relocation

Covers: recruitment agency fees (15–25% of first-year compensation for physicians), job advertising, interview panel time (typically 20 hours at $75/hr), signing bonuses, and relocation allowances where applicable.

C_onboard — Onboarding Cost

C_onboard = (orientation_hours × trainer_rate) + (salary × orientation_fraction) + credentialing_lag_cost

Covers: structured orientation period (default 4 weeks), credentialing/privileging lag for regulated roles. Physicians in Manitoba typically require 28–84 days from hire to independent practice due to credentialing.

C_prod — Productivity Ramp Cost

C_prod = annual_compensation × ramp_period_years × (1 − avg_productivity_during_ramp)

C_prod is an opportunity cost — it represents foregone clinical value during the productivity ramp period, not a direct cash outlay. It is displayed separately from the cash components in Senzo’s Cost Analytics to ensure correct interpretation.

Scenarios

Each role produces three cost estimates:

Scenario	Logic
Conservative	Lower-bound vacancy days, lower backfill premium, no signing bonus or relocation, productivity ramp at upper bound (75%)
Moderate	Geometric mean of parameter bounds, signing bonus included at benchmark, ramp at midpoint
High	Upper-bound vacancy days, upper-bound backfill premium, signing bonus and relocation included, productivity ramp at lower bound (50%)

Canadian role benchmarks

Role	Annual Comp	Vacancy Days (mod)	Search Fee	Ramp Period
Registered Nurse	$85,000	90 days	None	3 months
Licensed Practical Nurse	$62,000	60 days	None	2 months
General Practitioner	$280,000	270 days	15–20%	6 months
Specialist (mid-complexity)	$380,000	365 days	15–20%	12 months
Specialist (high-complexity)	$520,000	548 days	15–25%	18 months
Allied Health	$72,000	60 days	None	4 months
Health Care Aide	$48,000	30 days	None	2 months

Compensation anchors are drawn from MNU and MGEU collective agreements and CIHI benchmark data. They are estimates — actual costs will vary by organization and region.

Annualized cost

Senzo multiplies per-event cost by the number of observed departures in the last 12 months (pulled from your workforce_metrics data) to produce an annualized turnover cost estimate by role.

Retention break-even

The retention break-even threshold answers: how much could we invest in retention before it stops being cost-effective?

Break-even = annualized_cost × 0.10

Any retention program that costs less than this figure — and achieves at least a 10% reduction in departures — is financially justified.

Methodological flags

These limitations should be considered when presenting cost outputs to governance audiences:

Compensation figures are benchmarks, not actuals — enter your own data for precision
Vacancy days are scenario ranges reflecting fill-time uncertainty, not point estimates
C_prod is opportunity cost, not a budget outlay
The model does not disaggregate voluntary from involuntary turnover in its base form
Rural and remote locum premiums can be 2–3× urban rates — not reflected in base model

Getting Started

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Troubleshooting

Turnover Cost Model

Turnover Cost Model

The formula

Component definitions

C_sep — Separation Cost

C_vac — Vacancy Coverage Cost

C_acq — Acquisition Cost

C_onboard — Onboarding Cost

C_prod — Productivity Ramp Cost

Scenarios

Canadian role benchmarks

Annualized cost

Retention break-even

Methodological flags

See also

​Turnover Cost Model

​The formula

​Component definitions

​C_sep — Separation Cost

​C_vac — Vacancy Coverage Cost

​C_acq — Acquisition Cost

​C_onboard — Onboarding Cost

​C_prod — Productivity Ramp Cost

​Scenarios

​Canadian role benchmarks

​Annualized cost

​Retention break-even

​Methodological flags

​See also

Turnover Cost Model

The formula

Component definitions

C_sep — Separation Cost

C_vac — Vacancy Coverage Cost

C_acq — Acquisition Cost

C_onboard — Onboarding Cost

C_prod — Productivity Ramp Cost

Scenarios

Canadian role benchmarks

Annualized cost

Retention break-even

Methodological flags

See also