How small businesses can measure employee satisfaction

Managing people

30 May 2023

An employee satisfaction survey measures the level of staff engagement within an organisation, essentially telling you how your team feels about working for your company. The results can be used to build on positive feedback and address areas of concern.

Employee surveys are standard in larger companies. SMEs tend not to use them, partly because of limited resources, and also as owners and managers in small companies can assume they know their team well enough not to need one. However, it can be hard to spot disengagement, and a member of a smaller team may be more likely to mask dissatisfaction than they would in a large, anonymous organisation.

Employee satisfaction measures

While there’s no perfect way to measure employee satisfaction there are three common measurements that you might be aware of: the Employee Satisfaction Index (ESI), the Employee Net Promoter Score (eNPS) and the employee turnover rate. These measures can be used together and with larger surveys to ge a more holistic view of employee satisfaction.

Employee Satisfaction Index (ESI)

The ESI is a very simple three question survey with each question being answered on a scale of one to ten. One being a low/unsatisfied score and 10 being a high/satisfied score.

Here are the three questions:

  • How satisfied are you with your workplace?
  • How well does your workplace meet your expectations?
  • How close is your workplace to your ideal job?

After the questions have all been answered, you use an equation to discover your ESI score:

ESI = [((question mean value ÷ 3) – 1) ÷9]*100

These questions can be tacked onto a longer survey or use on their own to get a general idea of workplace satisfaction. Putting them in a longer survey may help you get a more comprehensive outlook.

Employee Net Promoter Score (eNPS)

The eNPS score is an even simpler survey in the sense that it has just one question:

On a scale of zero to ten, how likely are you to recommend our company as a place to work?

Answers to that question place the employees into three different groups:

  • Responses of nine or ten: These are known as promoters and are people who would highly recommend and promote your business as a good employer to others,
  • Responses of seven or eight: These are known as passives and they don’t feel strongly enough to recommend or discourage people from working for you. Ideally, you want to convert these people to promoters and stop them from becoming detractors.
  • Responses of zero to six: These respondents are known as detractors and they are likely to leave your company in the near future as they are not satisfied with their job.

To calculate your eNPS: eNPS = % of promoters - % of detractors

This gives you a score that can be anywhere between 100 and -100. Ideally, you want to have a positive score. If your score is low or negative, you may want to do some further research to find out what exactly is making your employees dissatisfied with their jobs.

Employee turnover rate

Often expressed as a percentage, employee turnover is the amount of your employees who choose to leave you in a given period. You could look at it quarterly, yearly, or in any other time frame that’s relevant for you.

Some amount of turnover is completely natural and isn’t something you should worry about. It can be a good way to get new people and new skills into the company. The goal is that there should be a good balance between retention and turnover, that way you have new ideas coming in, but also have reliable employees with experience who can guide the new ones. If your turnover rate reaches more than 15% per year, you may want to look into employee retention strategies.

To calculate the employee turnover rate:

Turnover Rate = (Employees who left / Average number of employees) x 100

Employee engagement surveys

The most straightforward way to get employee feedback is with a questionnaire. This is easy to administer, fairly simple to analyse and, above all, anonymous. Your employees are more likely to be honest if they don’t have to put their names to anything.

Survey Monkey offers free templates and advice, which is useful if you’ve never done an employee survey before. If you’d prefer to devise your own, think about what you need to know. Relationships with colleagues and managers, working hours and conditions, staff welfare, training and promotion opportunities are all subjects you should explore. You can use a scale (“Rate this statement from 1, unsatisfied, to 5, very satisfied”, for example) to make measuring straightforward. Give your colleagues the opportunity to expand on their answers and make suggestions.

If you need in-depth feedback, try a small employee focus group. This could be a second stage of the process, if the survey uncovers areas that need addressing.

Great employee satisfaction survey questions

Your employees are busy people so you don’t want to make your survey too long. Keeping it to 10 to 15 questions maximum means people are more likely to take the time to complete it.

Keeping most of the questions closed (using scales or ratings) also makes it easier to fill out while open-ended questions take a bit more time and thought to answer.

If you want to do surveys more regularly, consider giving them themes such as progression opportunities, workload, team work, or communication so that you can learn more about how your employees feel about a specific aspect of the working environment.


For this type of question, you can have a scale with three or five points – to make it five just add a strongly agree and a strongly disagree option to your scale.

  • I feel my team respects my personal time.
  • My workload is achievable within my contracted working hours.
  • Work is distributed evenly among my team.
  • If I encountered an obstacle, I know who to ask for help.

Rate from one to ten

  • How much do you enjoy being part of your team?
  • How satisfied are you with opportunities for growth within the team?
  • Do you feel adequately rewarded for the work that you do?

Open-ended answers

  •  How would you improve the way work is distributed?
  • Are there any processes that can be improved to make you day to day work easier?
  • Do you have any other suggestions for improving your workplace satisfaction?

What should you do with the employee feedback?

Never sit on the results. Once you’ve collated the feedback, share it with your team and be open when discussing the responses. It's then important to act on the information you’ve gathered. Some things can be fixed quickly (minor upgrades to staff facilities often feature) and others may take some time, such as opportunities for training and promotion. Build longer-term improvements into your business plan, and ensure everyone knows that these changes are in the pipeline. You can also reassure your team on any welfare issues by highlighting that you have employer’s liability insurance, which provides cover against work-related injury or illness.

Carry out the same survey in six or 12 months’ time, and compare the results. You can also use the survey to set senior members of your team targets in areas they are responsible for.

When you receive the survey results, an initial response can be to take the results personally, but try not to. Carrying out your first employee satisfaction survey is a big step towards ensuring your team has high morale, and that your business has productive, committed staff and a good retention level.

Other ways to gauge employee satisfaction

If you’re a small business, a survey may feel too formal, or you may benefit from more qualitative information since you don’t have enough employees for quantitative data to be meaningful. No matter what the reason is, if surveys don’t feel like the right way for you to understand employee satisfaction, here’s some other way to find out how your employees feel:

One on one meetings

While anonymous methods of feedback tend to get the most honest answers, that doesn’t mean face to face meetings have no value. If you’ve got a small team, then short and frequent check in meetings can be a really useful way to keep your finger on the pulse of the business.

These one to ones can be used to talk about a variety of topics such as:

  • Are there any obstacles preventing them from succeeding in their role
  • How they feel generally about the role and how they’re feeling outside of work
  • Have they noticed areas or processes that could be improved in the business?
  • Is there any additional training that would help them succeed in their role?
  • Is their workload realistic?
Employee suggestion box

If you want to keep the anonymity but allow suggestions to be collected at any point, then an employee suggestion box may be useful. You’ll be able to collate feedback as and when it is given rather than people waiting for a one to one or for a survey to go out.

Suggestion boxes don’t need to be physical this day in age – you can look into virtual ones that could be set up via a website or an app. As long as the anonymity remains, then any solution could work!

Improving employee satisfaction

If you've done a survey, one to ones or are concerned by your employee suggestion box, you may be wondering how to improve employee satisfaction. Even if there hasn't been any warning signs yet, it can help to implement some strategies early on and try to be proactive about employee satisfaction. If you're looking for ideas, here's a few to get you started:

Rewarding employees

A good commission, bonus, or other reward structure can play a big role in connecting your sales staff with your business, ensuring your goals are aligned and your team are happy and productive.

And with staff turnover at an all-time high, finding ways to keep your staff engaged and feeling appreciated will go a long way towards a better staff retention rate.

Read our guide to rewarding employees: commission, bonuses and more to learn about how to keep your employees feeling motivated at work.

Avoid micromanagement

It can be hard to let go control when you’ve built the business up from scratch. However, holding on too tight to projects and not allowing employees the freedom to do the job they were hired for can create a lot of tension in the workplace.

Being able to use creativity and have autonomy are often very important in keeping employees happy and engaged at work, so learning to trust the people you hire will go a long way towards improving employee satisfaction.

Learning and progression opportunities

According to a 2022 survey by Gallup, 51% of currently employed people said they were actively seeing a new job with opportunities to grow and develop listed as a top desire in their new roles. If your employees feel like they’re stagnating or there’s not a chance for titles and pay progression then they may lose interest in their role faster.

Finding or funding learning opportunities for staff can mean happier, more loyal and upskilled workers while progressing pay regularly will help retain great staff.

Other retention strategies

Check out our guide to employee retention for small businesses to read our list of 11 retention strategies that you can try out.

All links are checked and valid at time of publishing, 30 May 2023.

Work hard, insure easy

Running a business is hard work. That’s why we’re doing all we can to make your insurance a bit easier. From helping you tailor your policy to your unique business needs, to taking the guesswork out of finding business insurance, find out what we’re doing to help small businesses.