Last year one of our kindergarten teachers had two students who were retained. At the end of the school year she filled a jar with what appeared to be slips of paper with each student's names (actually just the two names were on each slip.) She told the students that next year would be her last year and that she would need 2 students to stay in her room for another year and help. Then she drew the names out of a jar and announced them. The students improved greatly not only in maturity over the next year but they worked really hard to learn in her class because they deemed themselves the leaders of the rest of the children. This may not work for you, but it could give you an idea of a softer way of dealing with the situation.