How to attract and retain Generation Z employees: A Legal Perspective

Losing staff is expensive. Recruitment costs, lost productivity, and training new employees can far outweigh the investment required to retain existing staff. ‘A well-drafted employment contract, combined with modern workplace policies, can significantly improve staff retention—particularly when it comes to Generation Z’, states Jessica Gowar, Head of Employment at Ware & Kay Solicitors with offices in York, Wetherby & Malton.

Understanding Gen Z in the workplace

Gen-Z, those born between 1997 and 2012, are sometimes perceived as "difficult" employees. In reality, they simply have different workplace values and clearer personal boundaries than previous generations.

The World Economic Forum predicts that by 2030, Gen-Z will make up approximately one-third of the global workforce. Employers who adapt their approach now will have a competitive edge in securing and retaining top talent. Key areas to focus on include Transparency & Adaptability, Flexible Work Arrangements, and Pay.

1. Transparency and Adaptability

Gen-Z is the first generation to grow up entirely in the digital age. With information always at their fingertips, they have developed a strong inclination to question processes and challenge the status quo. They seek workplaces that are transparent in decision-making and open to new ideas.

Businesses that foster a culture of openness, adaptability and inclusivity will be far more successful in retaining Gen-Z employees. This means ensuring employment contracts and workplace policies reflect clear expectations, fair treatment, and opportunities for employees to be involved in shaping the business.

2. Flexible work arrangements

Work-life balance is the top consideration for Gen-Z when choosing an employer, according to a 2024 Deloitte study. Having seen their parents struggle with rigid 9-5 structures, Gen-Z prioritises mental well-being and flexibility in their work environments.

A 2023 Deloitte study also revealed that over three-quarters of UK Gen-Zs would consider leaving a job if required to work in the office full-time. To stay competitive, businesses should integrate hybrid working or flexible hours directly into employment contracts, ensuring clarity and legal protection from the outset.

3. Pay and financial security

While flexibility and values are important, salary remains a major motivator. Gen-Z is entering the workforce at a time of high inflation, stagnant wage growth, and rising living costs. According to estate agent Hamptons, Gen-Z buyers are now facing mortgage repayments nearly double those of millennials at the same stage of life.

A 2022 Cigna survey found that Gen-Z employees are more likely to cite financial insecurity as their biggest stressor than any other generation. To retain top talent, businesses must ensure that remuneration packages provide financial stability and reflect current economic conditions.

The legal solution: Structuring Contracts for Retention

Employers often overlook the role that well-drafted employment contracts play in staff retention and engagement. Legal clarity around job expectations, benefits, progression opportunities, and flexibility can make all the difference. Jessica can assist businesses with:

• Drafting employment contracts that reflect modern workplace expectations
• Reviewing and updating workplace policies to improve retention
• Advising on legal compliance to avoid costly disputes
• Structuring flexible work policies that protect both employer and employee

For expert legal guidance on employment contracts and policies, contact Jessica Gowar, Head of Employment on  York 01904 716000, Wetherby 01937 583210 or Malton 01653 692247  or email jessica.gowar@warekay.co.uk.

Article written by Marion Akhurst, Paralegal, Employment Department