Workforce Relations

Overview

Workforce relations focus on developing positive relationships between company management and the workforce. When relations are good, employees gladly contribute their skills and experience to business activities. There is a mutually accepted understanding of capabilities and expectations.

The relationship between a company and its workers can be the source of enviable workplace harmony or it can present substantial risks.

Business risks

If the exchange of benefits for work is ambiguous or unjust it can lead to dissatisfaction that manifests as productivity losses, including work slowdowns or stoppages. An unengaged, unmotivated, or hostile workforce becomes a significant obstacle to effective business operations.

Less severe outcomes also damage a business. A company may face an inability to attract and retain talent that it needs for operations if it does not approach its relationship with its workforce respectfully, as a collaborative partner. Social media assures that negative information is spread. Turnover, and its many associated costs, may be high as a result.

What can businesses do?

Sustainability is becoming an important determining factor for workforce recruitment and retention. People want to work for organizations with strong social and environmental missions. Younger generations don’t want just any job. They are looking to work somewhere they can make a difference.

Many companies are integrating sustainability education and projects into training and development programs. This involves educating employees about why sustainability is important, how it relates to employees’ work, and what they can do to contribute. Sustainability projects are effective ways to engage employees in meaningful work. This engagement is, in turn, a good strategy for building support for sustainability across your organization.

A recent study by The Intelligence Group found that 64% of millennials polled say it’s a priority for them to make the world a better place. These individuals are looking to work for organizations committed to making positive change. What does this mean for your business? If you want to attract young, driven, highly skilled talent, you should make sure you’re the kind of business they want to work for.

In the increasingly competitive world of finding and keeping a talented workforce, no company can afford to disregard the critical role a satisfied, engaged, and productive workforce plays. A well-managed workforce has many other benefits as well. It promotes:

• loyalty
• productivity
• institutional knowledge retention
• a healthier workforce

Effective workforce management is also an excellent risk management tool. Developing and maintaining good workforce relations is a core part of protecting and growing a company’s social capital. How a company manages the relationships within its workforce can have real monetary value for a business. In this sense, good workforce management supports many attributes of social and economic sustainability.

Freedom of association & social dialogue

Freedom of association and social dialogue are critical aspects of fostering an engaged, productive, and satisfied workforce. Many companies take steps to make sure that communications, both among employees, and among employees, company management, and relevant governmental entities, are mutually respectful and productive. They respect employees’ rights to meet, raise and discuss concerns, and have meaningful input into policy matters.

Resources

• Q&As on Business and Freedom of Association

Employee attraction, retention & satisfaction

Attracting and retaining a talented, well-trained workforce is a significant competitive advantage for most companies. A strong focus on sustainability promotes strategies that make work more meaningful and satisfying. Ensuring that all employees have access to opportunities for education, training, professional development, and career advancement lead to a more capable, engaged, and satisfied workforce. This creates a virtuous cycle, continuously enhancing a company’s ability to attract and retain talent.

See also Compensation & benefits and Workplace amenities.

Resources

• Employee Retention – How to Retain Employees
• Employers Alter Benefits to Attract, Retain Employees, SHRM Finds
• What Millennials Want In The Workplace (And Why You Should Start Giving It To Them)

Workforce development

Organizations promote and fund professional development to maintain and grow workforce skills and capacities to meet existing and emerging business needs and trends. Companies that fund professional development protect prior investments in hiring and training, and support the ability to gain and maintain competitive advantage. Professional development also promotes employee engagement and loyalty, protecting against human resources losses and associated costs.

Meaningful work & engagement

Employees are crucial to creating a sustainable business. Engaging employees in all aspects of your sustainability program will be a key determinant for the success of your initiatives. The challenge is tapping into this power.

Why is employee engagement so important?

Actively engaged employees are far more motivated to work towards company goals than disengaged employees. Gallup’s 2016 “State of the American Workplace” report found that over 50% of workers fall under the umbrella of not engaged (emotionally detached) and actively disengaged (negatively view the workplace). Employees who are “checked out” while at work can mean significant negative consequences for business outcomes. A person’s engagement – or lack thereof – can create a “cascade effect” that spreads to other employees and beyond. There is a lot of room for improvement when it comes to employee engagement, and sustainability programs can help.

Having an actively engaged workforce can lead to many company benefits, some of which include:

• higher levels of innovation and productivity
• increased operating and net profit
• better organizational performance
• improved customer focus
• higher employee morale
• lower levels of absenteeism
• higher levels of staff retention
• improved talent attraction

For many companies, focusing on the triple bottom line of people, planet, and prosperity pays a dividend in recruiting and retaining top talent.

The power of purpose

The critical link between employee engagement and sustainability strategies is purpose. A growing number of people crave impactful work where they can make a positive contribution. One study found that 65% of workers said that “the potential to contribute to society” and “a job that will make the world a better place” is very important to them, with about 25% considering this to be essential.

Younger generations, and Millenials in particular, want to work for companies that are socially and environmentally conscious. The Net Impact Talent Report What Workers Want in 2012 showed 88% of graduate students factor an employer’s corporate social responsibility (CSR) efforts into their job decision. And 86% said they would consider leaving their job if the CSR program was not upheld.

Finding work with purpose – a deeper role beyond just satisfying finance-based business goals – is one of today’s top considerations in job acceptance decisions. Work with purpose is also a core driver for a culture of innovation and creativity. The shared goals that define purpose help create a bond and a sense of trust between employer and employee. This is, in turn, a key ingredient in high performance and productivity.

Meaningful work is a powerful driver of workforce attraction, retention, loyalty, productivity, and well being. It has the remarkable power to energize employees and make the organization come alive. This is more than just “feel-good” speak. A case study from accounting firm KPMG shows the positive impact work with purpose can have.

Case study: KPMG

Convinced that today’s employees crave a sense of purpose in their work, the accounting firm KPMG launched an initiative to inspire higher levels of engagement. A key component of KPMG’s approach was cultivating a strong emotional connection between employees and the firm. Priming the conversation with some examples, they asked everyone – from interns to the CEO – to share stories about how their work was making a difference. KPMG discovered a “pent up appetite” for employees to find and express what meaning work holds for them. Employees flooded them with stories and morale skyrocketed. In just a few weeks, they collected more than 40,000 stories that were shared with the entire workforce through posters and on-line postings.

The results of their purpose campaign exceeded expectations. Within a year, the firm experienced higher employee satisfaction and loyalty, and greater productivity. According to KPMG’s annual partner survey:

“90% reported that the higher purpose initiatives increased people’s pride in KPMG. Scores on our employee engagement survey rose to record levels as well. Less than six months into our Purpose initiative 85% of employees agreed that KPMG is a great place to work, up slightly from 82% a year earlier; after a year scores on this same question rose to 89%. Additionally, 60% said our purpose initiative strengthened their pride in KPMG and our work. This improvement in morale also resulted in KPMG surging 17 spots on FORTUNE magazine’s annual 100 Best Companies to Work For list, making us the number one-ranked Big Four firm for the first time in our history.”

What this means for business

Companies that are flourishing – in terms of engagement, productivity, and profits – are animated by a sense of purpose. As the case study above shows, to be successful over the long term, companies must first win the hearts and minds of their employees.

Organizations working to become sustainable are well-positioned to realize this potential and accelerate employee engagement. But this only happens when employees’ personal duties are connected to a larger purpose. This is easier to do when companies link sustainability efforts to business objectives and vice versa. That’s because sustainability is about caring for people and the planet. And as David Cooperrider, founder of Appreciative Inquiry says, “The quest for a flourishing earth is the most significant human and organizational development opportunity of the 21st century.” This only happens when employees understand the larger significance of their work: when personal duties are linked to the fulfillment of the company’s larger purpose.

Many companies are integrating sustainability education and projects into training and development programs. This involves educating employees about why sustainability is important, how it relates to employees’ work, and what they can do to contribute. Sustainability projects are effective ways to engage employees in meaningful work. This engagement is, in turn, a good strategy for building support for sustainability across your organization.

When employees are engaged, there is a greater sense of ownership and desire for sustainability initiatives to succeed. Some companies make the mistake of outsourcing sustainability work to external groups or consultants. By doing this, they miss a huge opportunity to engage employees in something most, if not all, of them crave: meaningful work.

Workforce Relations basics

In a healthy work environment – where workforce relations are good – employees feel valued and respected. They are motivated to give their company their best. Management motivates through acknowledgement of a job well done, as well as robust employee relations, tangible rewards, like compensation, and opportunities for professional advancement and development. Employees need to know what is expected of them in terms of assigned responsibilities and performance. What they receive in exchange should also be clear.

Workforce relations is also about making sure that the right people are in the right jobs, for the betterment of both the individual and the organization. It is about addressing the human spirit, including the need for purpose, growth, variety, and creativity. It is about finding how best to meet the organization’s need to get work done and remain profitable without diminishing the value and dignity of the workforce.

In the United States, federal laws and regulations, as well as internal company policies and procedures, guide workforce management practices. The goal is to create a workplace that is both ethical and profitable. Labor laws and regulations define the boundaries of permissible behavior in the quest for profits based on workforce efforts.

Recruitment & retention

Workforce recruitment and retention is an organization’s ability to recruit, select, and retain people with the talent to ensure business success. The successful hiring process attracts individuals who fit with the organization’s culture and provide the best mix of skills for available jobs. When hiring meets these goals and the company invests in training its workforce, retention is more likely. Retention of a well-hired workforce delivers on the company’s investment in its people and grows the business.

An organization can improve employee attraction and retention by providing a positive work environment that recognizes, rewards, and engages employees. Both employers and employees benefit from a work environment that facilitates happy, well-trained and productive workers.

Resources

• What Millennials Want In The Workplace (And Why You Should Start Giving It To Them)

Training & development

Workforce training and development programs enable employees to sharpen skills for their current job and prepare for career advancement. They keep a workforce abreast of market changes and advances, and ensure that employees stay up to date with job requirements.

Successful training and development programs often involve a coordinated approach among departmental functions. Companies work across functions to determine the specific training needs for all job levels within an organization. Developing such programs requires an understanding of specific and strategic organizational needs. This includes desired qualifications, skills, and competencies to move a business forward.

Whether developed in house or with external contractors or expertise, workforce training and development programs should measure learning and job performance outcomes. This is key to continuous improvement of such programs.

Effective training and development programs:

• improve workforce performance and productivity
• enhance employee satisfaction, motivation, and engagement
• reduce turnover and absenteeism