Amidst all the revenue numbers and share valuations that companies wear as a badge of honor, the concept of employee relationship management has emerged as another undeniable sign of a successful organization. Many aspire to work at companies like Google, not just due to the pay they offer but because there seems to be no dearth of provisions for engaging employee and employer relationships. By emphasizing well-being and a holistic approach to work, the company has become a frequently cited case study of quality employee relations in HRM. A Garter study indicated that employee experience was a top priority for 47 percent of HR leaders and it is important for us to explore why.
What is Employee Relations?
The term “employee relations” can be defined as the connections within the workplace, focusing on both the employer-employee relationship, as well as the relationship between all employees. The focus on employee welfare started post-World War II when retirement and pension plans appeared as the biggest forms of employer care. Over time, employees slowly began speaking out about working conditions, especially through labor unions, and employers began to feel the pressure to better manage employee relations. John Dunlop was among the first to discuss the interaction of three major groups—management, workers and their personal organizations, and the government. He asserted that the rules that were derived from these interactions governed employment relationships.
Gennard and Judge (2002) state, “Employee relations is a study of the rules, regulations, and agreements by which employees are managed both as individuals and as a collective group, the priority given to the individual as opposed to the collective relationship varying from company to company depending upon the values of management. As such it is concerned with how to gain people’s commitment to the achievement of an organization’s business goals and objectives in a number of different situations.” Resources indicate that the term “employee relations” started to gain popularity around 2006 when, according to CIDP, the meaning began to shift from the industrial relations understanding of employees as a collective whole, and instead emphasize the focus on individual employees.
These relationships affect a lot of different factors, from employee satisfaction to their productivity within the workplace. A CareerPlug survey of 500 employees indicated that 72 percent of individuals have left previous jobs due to a toxic work environment. If an employee does not feel comfortable in their work environment, retention becomes difficult, which is why it is important to maintain healthy employee relations.
What is the Role of Employee Relations?
Employee Relations is seen as a sub-category of HR, as it focuses on being a go-between for the employer and employees. The role of employee relations is to ensure that employee interests are kept in mind in all of the company’s overarching goals, despite the external industry struggles or changing global conditions. This can range from overseeing physical working conditions to providing fringe benefits that endear employees to their employers.
In a post-pandemic world where companies remain undecided on the benefits of hybrid models as opposed to in-person work setup, employee relations in HRM become even more important to ensure employee engagement remains high. An article by Greg Roper from 2015 indicated that interpersonal communication and conflict management were two of the most important skills to focus on, and that remains relevant today. A study by OD Adekoya reported that “there is an increased need for trust, fairness, and respect between both parties (employer and employee)”. They imply the presence of a psychological contract or an informal, unwritten commitment in the employer-employee relationship, a concept that was earlier defined by Schein (1988). The study indicates that a breach of contract could happen by either party and hence emphasizes the importance of it in maintaining healthy employee relations.
Why is Employee Relations Important?
Think back to any project you might have last worked on, where other individuals were involved—a science class in school, planning a road trip with friends, or anything that required collaboration. Consider whether you had to be on the same page about the plan of action, what was required for the project, where to get resources from, etc. If there was smooth communication and you felt your opinions were considered, it is likely you enjoyed the process a lot more. On a large scale such as an organization, it becomes that much harder to ensure employee relations are positive and everyone feels valued.
With the ongoing focus on diversity, equity, and inclusion (DEI) within workplaces, it is important to understand that conflicts are more likely if employee relationships and anti-discriminatory practices are not prioritized. HRM principles indicate that defining the company’s ethics and values can make maintaining a harmonious workplace that much easier.
Poor employee relations can go as far as to lead to strikes, where disharmony between an employer and employee priorities can affect the industry as a whole. In recent times, the WAG and SAG-AFTRA strike has disrupted the entertainment industry, with no respite in sight for the writers and actors who feel unfairly compensated despite the booming industry. 11,500 writers and 160,000 Hollywood actors are currently on strike as a result. The UAW is also set to repeat history against Detroit’s Big Three automotive companies if their demands are not met. This not long after UPS narrowly avoided a strike recently, just a week ahead of when workers were set to walk out. Teamster’s last strike against UPS in 1997 saw 185,000 workers demanding better wages and full-time employment, among other things. These strikes represent the worst-case scenario as a result of a disrupted employer-employee relationship, where large-scale losses and an unpleasant work environment become inevitable.
What Are Some Employee Relations Examples?
Any interaction between an employee and their employer could be an example of employee relations.
Onboarding Procedures
Introducing the employee to the work as well as their workplace culture is important in helping them settle in. A study by the Brandon Hall Group indicated that an effective onboarding process could boost employee retention by 82 percent and improve the productivity of these new employees by over 70 percent. These numbers are clear indications of the importance of onboarding.
Performance Reviews
The format a company adopts for providing feedback to an employee can determine how the employee accepts and inculcates that feedback. A study by Zenger and Folkman indicated that 72 percent of respondents believed critical feedback from managers was necessary for their careers and found it currently lacking.
Conflict Management
Why are workplace conflicts such a common grievance? A CPP. Inc. report showed that 49 percent of workplace conflict happens due to personality clashes and egos. Concurrently, 95 percent of employees who received conflict management training stated that they were better able to resolve workplace complications effectively. Establishing a private and safe channel of communication is key to maintaining harmony but training employees on conflict management is also beneficial in employee relations management.
Addressing Well-being
Ensuring a work-life balance, maintaining communication within work hours, and implementing employee feedback are some ways of ensuring employee satisfaction. Eight in ten Gen Zs and millennials report mental health support to be an important criterion while considering a potential employer, according to Deloitte, and this is important to account for in employee relations as well.
Resolving Harassment Concerns
An International Labor Organisation report states that more than one in five people of employees have faced some form of harassment or violence in their workplace. Sensitive topics like sexual harassment, racial discrimination, bullying, etc. are very difficult for employees to bring up and should be addressed with complete seriousness when any complaints are made, while also ensuring the safety of the victim.
Handling Termination Interviews
Even though this comes at the end of an employer-employee relationship, it determines how existing and future employees view the company. A Harvard Business Review article uncovered that exit interviews were not universally utilized and two-thirds of those that conducted it only involved a conversation about salaries and benefits with no follow-up. The article states that it is imperative for companies to investigate underlying issues relating to HR, look into the manager’s leadership styles, understand the employee’s perception of the job, etc. in order to gain valuable insights that HR can actually make use of to retain existing employees.
What Are the Four Pillars of Employee Relations?
There are many important factors to consider for a healthy workplace but let us look at the four pillars of employee relations.
Open Communication
The core of a healthy employer-employee relationship is open and honest communication about all factors that might affect work. Even a detail as simple as whether an employee feels comfortable greeting their seniors can contribute to how an employee feels on entering the workplace. With the magnitude of work that is accomplished within a company each day, it is imperative that there are sufficient avenues of communication. The employer should be clear about the function of the employee and the goals of the organization. The employees, on the other hand, should be able to communicate their ideas to management in an effective way. SoOme cases might require HR to manage employee relations but that is an effective avenue as well.
Employee Appreciation
All HR and HRM sources on employee relations will be able to confirm the importance of positive feedback and appreciation. The employee and employer relationship balances heavily on whether the worker feels valued at work and whether their contributions are acknowledged. Appreciation does not always have to take monetary forms and can even extend to being offered additional opportunities and roles. Verbal acknowledgments of performances are a great start to building a communication channel as well. Fringe benefits for employees also aid in showing appreciation for an employee’s work.
Feedback Sharing
A McKinsey survey of 12,000 managers found that managers believed “candid, insightful feedback” to be crucial to career growth. Ensuring that feedback reaches employees is critical to giving them an opportunity to improve on performance rather than being penalized for it at a later stage. Feedback can help employees manage their work better and employers who are open to feedback can find themselves in a better position to understand their employees as well.
Employees Investment
Employee relation is not a one-time investment. It includes check-ins with HR as well as managers to see what employees might need for their overall growth. With the advent of technology, industries are constantly evolving and for the company as a whole to stay up-to-date, it can be more economical to help employees skill up rather than constantly rehiring new blood. Investment in employees can also include external considerations such as aiding them with mental health concerns, child care assistance, insurance assistance, etc. to improve their ability within the workplace as well.
With all this data available at the tip of their fingers, employers are ideally placed to review the current status of their company in non-monetary terms and determine how they want to evolve next. A purpose statement is a note-worthy step towards defining not just the company culture and goal, but the employer and employee relationship they envision for the future of their organization as well.