Two divergent ideas explain the relationship between performance and voluntary turnover. One suggests that higher performing employees, who are rewarded for their superior work product, will desire to remain with an organization that values their performance and will, consequently, be less likely than lower performing employees to voluntarily leave. An alternative idea suggests that higher performing employees, who are more desirable to external companies as a result of their superior work product, will have more external job opportunities and will, consequently, be more likely than their lower performing colleagues to voluntarily leave. The current study evaluated the behaviors and attitudes of 12,545 insurance employees over a 3-year period to examine how these 2 divergent expectations influence the performance-voluntary turnover relationship. Results show that both pay growth and the relevant unemployment rate interact with performance to influence the performance-voluntary turnover relationship and that they work independently of employee job satisfaction influences.
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