Types and Reasons for Transfer of Employees in an Organisation!

Transfer is a type of mobility of employees which involves a change in the job, accompanied by a change in the place of the job, without a change in responsibilities or remuneration.

Here ‘transfer’ and ‘promotion’ should not be confused to mean one and the same. Promotion involves a change in which a significant increase in responsibility, status and income occurs whereas transfer involves a mere change in the place of the job.


Transfer can be defined as “…the moving of an employee from one job to another.” It may involve a promotion, demotion or no change in job status other than moving from one job to another.

Transfer is “a lateral shift, causing movement of individuals from one position to another usually without involving any marked change in duties, responsibilities, skills needed or compensation”.

Types of Transfers:

(i) Production Transfer:

Transfers caused due to changes in production.


(ii) Replacement Transfer:

Transfers caused due to initiation/replacement of a long standing employee in the same job.

(iii) Rotation Transfers:

Transfer initiated to increase the versatility of employees.


(iv) Shift Transfer:

Transfer of an employee from one shift to another.

(v) Penal Transfer:

Transfers initiated as a punishment to in disciplinary action of employees.


(vi) Remedial Transfer:

Transfers initiated to correct the wrong placements.

Reason for Transfers:

(a) To meet the organisational requirement when there are changes in technology, volume of production, change in organisational structure, fluctuation in market conditions etc.

(b) To satisfy employees’ needs and their desire to work in a friendly atmosphere, in a department where scope for individual growth is high, in or near their native place or place of interest.


(c) To utilize employee’s skills and knowledge where it best suits or required.

(d) To improve interpersonal relationship and thereby reduce interpersonal conflicts.

(e) To give relief to the employees who are over burdened or doing complicated or risky work for a long period.

(f) To help the employees whose working hours or place of work is inconvenient to them.


(g) To punish employees for violating the disciplinary rules.

Transfers can be employee initiated i.e., primarily in the interest of the employee and his convenience. Transfers are also at the initiative of the company.

Transfers prove beneficial to both the employees and the organisation. To an individual employee, transfers reduce monotony and boredom and increases job satisfaction and improve employee morale.

They help the employees to prepare to meet the fluctuation in business and other organisational requirements and thereby enhances the contribution of employees to the organisational effectiveness.


Despite the benefits transfers also have problems like— problem of adjustment, cost and inconvenience to the employee, loss of man days, at times reduction in productivity.