Struggling employee relations

It doesn’t take a lot of effort to find examples of when employee relations go wrong. These types of incidents often make headlines. Fallouts from Uber, Google and Tesco – detailing, in order, harassment, diversity issues and a failure of care – all set the news agenda when they hit the public sphere. Yet, it’s not just the big players that have to worry about employee relations. At the start of the decade, a study from Kings College London and a business law firm found that poor employee relations were the main cause of grievances across a broad spectrum of organisations. For on-the-ball HR practitioners, they know this will have a follow-on impact for engagement, retention and the employer brand.

Evolving employee relations

The incidents from, in particular, Uber and Google showcase how employee relations (ER) has evolved. It is increasingly concerned with how employees perceive work and how their work environment works for them. For many organisations, this type of function has superseded industrial relations as trade union membership has tailed off and the employment relationship has become increasingly individualised. These days the employee-employer relationship is less likely to concern itself with the collective and more with how working conditions, reward, recognition and work for the individual. Not forgetting, how that person interacts with their manager, the organisation as a whole, and their team.

“I genuinely believe that ER is a worthy function that delivers a huge amount of value”

Transforming employee relations

But could ER be transformed further? And, if so, could it actually drive better business performance? It is the transformative potential of employee relations – whether the function could evolve further and whether this could be acted upon to drive better business outcomes – that was the focus of a recent AdviserPlus and HR Grapevine roundtable of senior HR leaders from a broad cross-section of different industries.

Chaired by Rob Williams, Director, AdviserPlus, the leaders discussed perception of employee relations from the business, the utility it currently served, what utility it ought to serve, and the impact of technology and managerial capability on employee relations. There was unanimous agreement that, in some area, it could transform for the better and often these fixes could come from within the function itself. “By maturing, by providing data, and by using that data to provide insights, using digitalisation to simplify how the employee relations service is accessed, you’ve solved a lot of the issues already,” explains Williams.

“ER is often seen as process management, or as a necessary evil. Very few line managers relish the time handling ER cases can take up. My counter to that is clear: spend a little time addressing an issue earlier means you don't have to spend more later. ER management is just basic Management 101.”

Ian Renwick, Employee Relations and Insights Manager, Flybe

Employee relations as an ‘expensive failure route’

Despite the agreement that employee relations could change to become less transactional, Williams summarises another statement about the employee relations function that the room generally agreed upon: “With any service you need a failure route.” In a wider business context – of cuts, of increased managerial workload, of firms working faster, of individuals expectation of, and engagement with, business changing – all businesses need something that Williams describes as “managing the reputation of the business”. Employer relations is this failure route, this reputation manager, and, in Williams’ words, “a gold-plated insurance policy”. Whilst it may not manage its own workflow, demand and be proactive, in an organisational sense, a well-performing employee relations function, in its current form, is able to ward off bigger fallouts when an employee has a grievance. “When I sit down with HR Directors, they say one wrong move [in the employee relations space] and you’re on the front page of tabloids which has a huge business impact,” Williams adds.

Whilst roundtable attendees recognised this current utilisation of employee relations, they asked whether employee relations should always be the first port of call during disputes and whether managers could better deal with some employee relations issues.

Manager-centric employee relations

There seemed to be widespread consensus that employee relations was a go-to rather than a last resort or a coaching service, amongst the HR leaders at the roundtable. To get better, Williams noted that most agreed it should be about “going out to support managers to be better managers.”

He continues: “Most of the employee relations professionals at the round table [said] that their value was in coaching: proactively helping managers to be better managers. However, if you ask anyone else in the organisation, they would say the benefit [of ER] was in dealing with issues.” All noted how expensive the latter one was, agreeing cost savings were associated with the former – which could also free-up the function to be leaner and get more creative about how it can best support the organisation as a whole.

Valuable employee relations

“I genuinely believe that ER is a worthy function that delivers a huge amount of value,” Williams tells HR Grapevine, “but there are certainly efficiency savings that could be made.” Suggestions from the roundtable looked at managerial capability, training them to be better people managers – the Kings College 2010 study found that most employee grievances came from the manager-employee relationship – in order to manage issues at source, rather than through expensive ER processes.

Other suggestions looked at aligning with L&D to create managerial courses – as well as assessing which employees were best suited to management – measuring the efficiency of employee relations, implementing technology to support managerial talent, and getting data-savvy to look at where its needed most and how to be proactive about demand on the function. Something that encompasses all of these aspects? “Now that would be an agile HR project,” Williams adds.

Could ER transform itself out of existence?

“For forward-thinking organisations there will always be the need for employee relations expertise in the business,” says Williams. He adds that it might not look like it does now – as a constant feed of advice and information providing. It might, instead, become a more efficient service that is proactive about coaching managers on how to manage their team and what company policy and legislation means for them. “Allowing managers to take responsibility at source would be the optimum answer,” Williams adds.

He continues: “The most successful [ER functions] have a transformation head, a digital expert, a process expert. They’re interested in simplicity, efficiency, analysis, engagement and assurance. Using technology to enhance all the things they did before.” Whilst this might result in a leaner employee relations function, roundtable consensus was it would also be a more leading function better aligned to what the business needs. On a volatile, talent-tight, increasingly transparent business landscape, this might be the transformation your business needs.