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Employee Relations [2023 Complete Guide]

November 13, 2021
9 Min Read
Photo by
Dmytro Novitskyi

Table of Contents:

What are employee relations?

Employee relations encompass all of the interactions that take place between employees and their employers. Employee relations include issues regarding pay, work hours, dress code, benefits packages, job security, working conditions, promotion opportunities, and workplace diversity. Employee relations may also involve internal human resources issues such as sexual harassment complaints or wrongful termination claims.

Why are employee relations Important?

Employee relations are important because they form the foundation of trust between an organization and its employees. When workers feel respected by their supervisors for their contributions to the organization's success, they tend to reciprocate this respect with hard work and loyalty towards the company. 

Negative employee relations impact business performance in several ways: Unhappy employees can lead to higher rates of absenteeism and turnover. HR Acuity estimates that it takes approximately 45 days for new employees to become acclimated to their new job. This makes a high turnover rate expensive and lowers productivity. 

Poor employee relations practices also result in increased rates of theft and safety violations. Employee relations issues that work their way into the news media and onto social media sites can also damage a company's reputation and hurt its bottom line.

Benefits of employee relations

Strong employee relations benefit organizations in several ways including:

  • Help companies maintain a positive public image, which helps build consumer confidence.
  • Provide a training ground for managers to develop their leadership skills. Employee relations give managers experience dealing with human resources issues such as sexual harassment complaints or wrongful termination claims.
  • Allow workers to voice concerns through proper channels rather than by engaging in unproductive behavior such as vandalism or milking sick days from work before quarterly earnings come out.

Good employee relations can empower workers to develop a sense of ownership towards their work and provide them with a strong voice in the company's decision-making process. Maintaining strong employee relations allow companies to identify workers' concerns early on, rather than waiting until a problem escalates into a full-blown crisis.

7 examples of employee relations issues

Employee relations issues commonly reported by employers include:

  1. Pay disputes: Inadequate pay is one of the most common causes of employee grievances. Small business owners often have limited resources for payroll, making it difficult to give raises across the board during annual performance reviews. In these situations, employees may feel undervalued and become disgruntled if their wage hikes aren't commensurate with those of other workers in similar positions. Employee relations issues may arise when a portion of workers receive wage raises while others do not. Employee relations can become complicated if one or more employees were originally hired at a lower starting salary than other members of the workforce, and their contracts require them to stay at that level for an extended period of time. One of the common issues is that women are often paid less than men.
  2. Dress code violations: Employers generally publicize dress codes in employee handbooks so all employees are aware of the company's expectations in terms of workplace attire. Employee relations issues often emerge when certain employees refuse to follow the rules and insist on wearing clothing that violates company standards. Depending on how many violations occur, employers may issue verbal warnings before firing offenders who continue dressing inappropriately despite repeated requests to comply.
  3. Employee benefits violations: Some employees may try to take advantage of their company's generosity by abusing company policies related to health insurance or other benefits. Employers should put strong safeguards in place so these scenarios don't occur, but it can sometimes be hard to tell which employees are violating the rules until after they file a claim for benefits. Employee relations issues often crop up when workers get caught taking advantage of their employer's generosity and deny any wrongdoing even though evidence suggests otherwise.
  4. Employee safety violations: Employer negligence is considered one of the leading causes of workplace injuries and fatalities every year. Employee relations issues sometimes occur when an employer fails to enforce safety policies with all workers in the workplace. Employee relations issues may also arise if there are discrepancies in safety training between new hires and veteran employees who have worked for the company for several years without ever receiving further education or certifications on new safety protocols implemented within the last few months.
  5. Employee absence violations: Some employers provide workers with unlimited sick days, while others offer a specific number of paid days off each year. Employee relations issues commonly arise when employees take advantage of their company's generosity by abusing sick leave policies. Employee relations may become strained if employees repeatedly call out sick just before quarterly earnings reports come out or other important business meetings are scheduled to occur. Employee relations may also be strained if employees call out sick with the flu, but it's evident they were healthy enough to attend social gatherings or other non-work-related engagements. Employee relations issues may sometimes arise during National Sick Leave in observance of Veteran's Day and Martin Luther King Jr. Day as well.
  6. Employee wage theft: Many companies fail to reimburse workers for expenses incurred on behalf of their employer. Employee relations issues often occur when an employee refuses to pay back the company for a cash advance that was initially given to them or reimburses the company at a significantly lower rate than what experts recommend. Employee relations become increasingly complicated once lawyers get involved and lawsuits are filed by both workers and employers. Employee relations may also become strained if one worker files a wage theft claim, but the company fires them for filing a false claim.
  7. Employee sexual harassment: Sexual harassment is considered one of the biggest threats to employee relations, especially when it occurs in the workplace and involves key members of upper management. In fact, in an NBC poll, nearly half of American women in the workforce report experiencing harassment at work. Employee relations issues may emerge if employees feel there is an unspoken rule or code of silence that prevents them from reporting instances of sexual harassment without fearing retaliation. Employee relations issues also crop up around National Sexual Assault Awareness Month and other times throughout the year where employers are expected to hold mandatory training sessions about sex discrimination in the workplace.

Employee relations issues can be very serious, as they impact morale and productivity within a company. Employee relations best practices involve strengthening communication with all employees so they feel comfortable sharing their opinions and concerns with their employer. Employee relations tips and ideas involve maintaining a workplace that is free from discrimination, harassment, and favoritism so all workers are treated fairly. Employee relations strategies also involve updating work policies to reflect fair employment laws as they change over time. Employee relations training involves providing new-hire orientation programs as well as company-wide safety seminars as required by law.

Companies that develop and maintain strong employee relations

A successful business is only as good as its employees and its relations with them. Companies that prioritize and create a healthy work environment for their employees generally see better results than those whose employees feel undervalued and unappreciated. Companies that focus less on profits and more on creating a friendly, supportive workplace fare even better in the long term; this can be seen in many examples throughout history. Companies that prioritize their employees tend to also produce better products, encouraging positive external relations for years to come.

There are several examples of successful companies that have prioritized employee relations over profit. One company is Google, whose commitment to their employees has allowed them to continue producing excellent products and services with happy employees, turning them into one of the biggest, most successful companies on the planet. They provide their employees with many different types of company-sponsored onsite perks, including top-of-the-line cafeterias, onsite gyms and swimming pools, dry cleaning services for employees’ clothes on demand, car washes, haircuts at a salon located onsite, and a full-time massage therapist.

Companies like GoodRx, a pharmaceutical agent company that manages a large number of pharmacies nationwide, have been able to focus on their employees while still providing services to their customers. They provide perks such as summer Fridays where everyone gets the day off before the weekend starts or half days before holidays.

Another example is Virgin Group, the holding company of over 400 businesses. They subsidize any education or training employees want to pursue so long as it contributes to their career at Virgin, and provide up to $10,000 for new parents who are adopting or using reproductive technology to conceive a child.

One more example is Facebook. A recent study conducted by CareerBliss showed that 90% of Facebook's employees would recommend working there to a friend. The study also concluded that the top three reasons employees gave for loving their job were that they are recognized, rewarded, and promoted by management. Employees are given many different perks at Facebook, the most notable of which being free breakfast, lunch, dinner, snacks, and drinks provided daily in addition to paid sick leave for public transport delays due to extreme weather conditions. There are company outings each month where things like rock climbing/bungee jumping/skydiving are offered along with other city events such as movie nights or picnics.

The list goes on with other companies, but the main idea is to show that by prioritizing employees over profits, a business can create a more successful company with happy customers and an appreciative workforce.

Remote teams and employee relations

Employee relations can be divided into two types: In-person and remote work conditions. The relationship between employer and employee has existed for centuries, even though technology has allowed companies to grow beyond the traditional office setting, creating new challenges unique to modern companies. 

Employee relations responsibilities vary based on industry, role, employment status (full-time vs part-time), and company culture. Many companies have a dedicated employee relations team that provides support and guidance to employees-especially those who work remotely or who do not have direct access to supervisors for daily guidance. Career advancement also varies significantly depending on the industry, size of the company, and function of position.

In the United States, employee relations are usually overseen by employee relations departments within Human Resources (HR). HR usually contributes ideas for employee relations training initiatives which can range from public seminars to more in-depth formal training sessions. Employee relations best practices are constantly evolving as technology changes the way businesses operate and stay connected to their employees.

Many successful companies keep an open line of communication with employees by establishing employee relations strategies. Employee communications tools like employee relations software may be used to facilitate communication both inside and outside an organization, allowing for more time dedicated to tasks that require significant attention. Employee relations practices must evolve in order to meet the needs of growing companies, and employee relations professionals are critical in helping companies maintain positive relationships among all employee levels.

How to improve employee relations

  • Keeping employees informed on company matters such as policies, procedures, goals, successes, failures, compensation plans, etc.
  • Having open communication lines
  • Encouraging an environment of trust between managers and subordinates where the manager is receptive to his/her subordinates’ concerns and ideas
  • Minimizing the number of changes a company incurs over time
  • Maintaining consistency in decision-making processes throughout all levels of management
  • Delegating responsibility to employees
  • Informally evaluating employees for potential promotion
  • Rewarding good performance with incentives such as promotions, bonuses, verbal recognition, etc.
  • Training employees to take over future leadership roles in the company
  • Creating the opportunity for professional development through training and education
  • Creating opportunities for growth (i.e. job rotation or delegation of tasks) within an organization or department

Employee relations best practices

Employee relationships are the foundation of every business. By establishing that foundation, employees are more likely to focus on their work and provide quality service to customers while consistently meeting the company’s goals and objectives. Maintaining good relationships with employees helps manage stress levels. According to a study by The American Institute of Stress, 80% of workers feel stress on the job with nearly half needing help learning how to manage it. Stressed-out employees tend to have lower job satisfaction, which in turn leads to lower output.

Employee relations best practices include motivating employees, preventing conflict in the workplace by anticipating problems, identifying sources of conflict before they escalate into large-scale disputes, protecting employees from harassment or unfair treatment, providing open lines of communication between management and staff members, ensuring due process for all personnel involved in disciplinary actions, maintaining a system of reward for desired employee behaviors and maintaining legal compliance through affirmative action policies.

Employee relations tips and ideas

Employee relations don't have to be complicated. Just ensure that you're working together as a team instead of against each other which should help combat any issues. And if all else fails, don't be afraid to ask for help when you need it. Employee relations will always be important in any work environment because people are affected by them so you should take the time to get it right. Here are a few tips and ideas to maintain strong employee relations.

  • Set up weekly meetings with each group or department to check their progress and come up with new ways of doing things together;
  • Check-in with employees to see how they are feeling or if there is anything you can do for them;
  • Reward the people who show great contributions to your company.
  • Treat everyone equally.
  • Show respect towards every employee because not only is it good for morale but it will encourage others to work with you as well;
  • Ensure communication is consistent between employees and the bosses so that everyone has a clear understanding of what's going on within the company;
  • Include diversity within your company in order to make sure misunderstandings don't arise because people are from different backgrounds or cultures.

Employee relations strategies and training 

There are many different strategies that an employer can implement in order to develop a positive relationship with employees. Employee relations training is the best way to achieve this because it enables their management and workers to communicate effectively while building morale and commitment among them. Employee relations strategies should be committed if the company has high expectations of workers and managers.

Employee relations training is not only beneficial to the company, but also to employees because it helps them better understand their work which can increase job satisfaction. Employee relations strategies should cover various topics such as how to treat each other with respect, understanding different personalities at work, and managing high-performing individuals. 

Strong employee relations must be continuous in order for the morale of both workers and managers to stay positive. Employee relations are sometimes neglected by employers who think that they are an unnecessary cost or expense. However, this could not be further from the truth since negative employee-management relationships can lead to low productivity levels among the staff. Employee relations training should always be accompanied by good communication so that issues can be solved quickly without potential conflicts arising between either party.

Employee relations for small and medium businesses

Employee relations for small business helps employers maintain a healthy working environment that helps employees work productively without the fear of being terminated. Employee relations best practices for small business also includes employee engagement, employee evaluation processes, customer service efforts, and wage-benefit packages. Employee relations for small businesses also include employee relations Software, employee engagement software, and employee evaluation software.

Employee relations for large businesses and organizations

Employee relations best practices for large businesses involve employee relationship management (ERM) software that enables an organization to benchmark its employee retention levels against industry norms, analyze the reasons behind attrition patterns, compare engagement levels across departments or business units, etc. Employee relations best practices for large businesses also cover employee retention metrics (retention rate), and employee satisfaction metrics (employee satisfaction index). Other topics include wage-benefit packages, employee career planning, employee performance reviews, etc.

Employee relations metrics

Metrics help employers understand how their human capital investments are performing. Employee relations metrics include employee retention metrics (retention rate), and employee satisfaction metrics (employee satisfaction index), etc. Employee relations metrics are used to assess employee retention, morale, the quality of workplace relationships, problems with management or leadership styles. Employee relations metrics can help an employer determine whether they are making good use of their human capital investment and what actions need to be taken. Employee retention is best done by focusing on company culture rather than just financial incentives.

Employee retention rate

This measures how many individuals have remained employees in a particular company or division for any given period of time. A higher Employee Retention Rate would indicate that there are competitive compensation packages offered to attract employees and keep them at their jobs. When compared with other companies in its industry or region using similar employee profile types, it will provide managers information about how competitive their pay levels are relative to other organizations. Turnover is an important metric to keep track of. According to a Gallup poll, the cost of replacing one employee ranges anywhere from one to two times the employee’s annual salary.

Employee satisfaction metrics

Employee satisfaction metrics measure how well employers are satisfying their employees’ needs and encouraging them to stay with their company. Employee satisfaction is an important element in motivating your workforce and keeping it productive, satisfied, and motivated. Employee satisfaction metrics include an Employee Satisfaction Index (ESI) which measures employee satisfaction across multiple dimensions such as pay, benefits, promotion policies, etc. Employee satisfaction metrics can provide information about what makes people happy at work; they measure whether worker happiness comes from salary increases, promotions, or opportunities for advancement.

Employee relationship metrics

These metrics provide real-time information about your current workforce's likelihood to stay or leave your organization as opposed to those from past years who might not represent the same mix of job functions currently held by employees.

Employee relations software

Employee relations software helps to increase productivity, reduce costs and foster positive relationships between the employees and managers. Employee relations have a significant impact on an organization's business success so it makes sense to invest in good employee relations practices.

Employee relationship management (ERM) is a form of employee relations software that manages your organization's people relationships. Social networking software has been around for many years but recently has become more popular with businesses because they understand that employee relationship management can have a positive impact on the company.

Employee relations software can help achieve many positive results for your organization including:

  • Improved workforce productivity
  • Increased customer satisfaction
  • Improved stakeholder engagement/perception
  • Enhanced knowledge sharing processes within the workforce
  • Flexibility to match changing business requirements 

One example of employee relations software is Matter, which helps employers maintain strong employee relations. This free Slack app can be used to shower employees with praise and constructive feedback to help them develop professionally. It’s a win-win for everyone involved.

Free Employee Recognition, Celebrations & Rewards App
Free Forever. 2 Minute Setup. No Credit Card Required.
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