MJ White Paper AW

8/12/2019 MJ White Paper AW

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Contents

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: Foreword by Neil Carberry

: Foreword by Paul Nowak

: Executive summary

: Introduction by Andy Cook

: What is employee relations?

: The four elements of employee relations

: Developing an employee relations strategy

: Building management capability

: Enabling the right employee voice

: The role of unions in the employee voice

: Internal communications

: Assessing your current employee relations

: Conclusion


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Forewordby Neil CarberryDirector for employment and skills, CBI

There was a time during the last two decades where one could

sustainably ask what the future role of employee relations was,

when the human resource management (HRM) school of thought

was in its pomp.

While collective employee representation has been replaced in large

parts of the labour market by a more individual approach to employment,

the trend of that time was to write off employee relations as a field with

it. That was both an overreaction and counter-productive.

While HRM relied on alignment, and often a significant budget to back

it up employee relations works from a different analysis, namely that

employees and companies have legitimate but separate aims for

work. Employee relations says that these aims are not in opposition, but

that effort is required to make sure that they are mutually supportive. In

doing this, a wide range of bodies and approaches are relevant it is not

merely the art of trade union negotiation as well as a set of skills that is

not easily developed from study in the HR field.

The foundation of the Employee Relations Institute over the past year

driven by the author of this piece is one route to helping businesses

approach the challenge of employee relations. This paper is another,

seeking to define and identify the key areas of this vital issue. While the

views are the authors own and there are areas where the CBI would

differ slightly in its analysis there is no doubt that getting the debate

going again about making employee relations work is to be heartily

welcomed.

3 Defining & Measuring employee relations Marshall-James


4/164 Defining & Measuring employee relations Marshall-James

Good employee relations are important at any time, but never

more so than at times of economic uncertainty and flux.

For too many employees today, job insecurity, falling living standards and

increasing pressure and stress are becoming the norm. The latest State

of HR survey published by Kings College shows very clearly that longer

working hours, increased workplace stress, problems relating to the poor

use of performance management systems, and falling pay are creating

damaging workforce outcomes in both the short and long term. Most

managers know that employee engagement and employee relations are

important, but with pressures on budgets there is often a gap between

the good intentions of managers and practice on the ground.

This paper attempts to give employers and managers a tool to assess

the condition of employee relations, to ensure that organisations have

a clear strategy in place; that management has the capability and skills

it needs to implement that strategy; that employees have a genuine

voice. Effective internal communications are the key components of

the approach outlined in this paper, and have a relevance across both

unionised and non-union workplaces.

In a unionised environment, it is essential that managers also take

time to understand the role of the union, and respect the wishes of

their employees to be represented by a union. For some private sector

employers with little experience of unions dealing with a union can

seem daunting. The paper helpfully outlines how effective engagement

with a union can support a broader employee relations strategy.

The TUC believes that unions have an important and positive role to

play in Britains workplaces. Our members want to work for successful

organisations that treat them and their unions with respect. Good

employee relations are an essential component of these types of

workplaces, but they dont come about by accident. This paper can

hopefully help managers, union reps and employees to chart a shared

course to building better employee relationships.

Forewordby Paul NowakAssistant General Secretary of the TUC


5/16

The importance of creating the right

employee relations climate in every

workplace has become a greater

priority amongst senior managers

and in boardrooms; not just from an

employee welfare perspective, but also

from an organisational effectiveness

perspective. Most employers want

to improve their productivity and

efficiency, and benefit from the

discretionary effort of their employees.

This can only be achieved in a positive

employee relations climate.

There is currently no shared definition

of employee relations. This lack of

definition makes it difficult to create

minimum standards, benchmarking

and sharing of best practice;

particularly when business leaders

and employees want to compare the

condition of employee relations in

their organisation against others.

We have attempted to put down

a definition, based on practicalexperience, together with identifying

the core elements that contribute

to employee relations, and then a

measurement tool to assess current

state and help articulate the longer

term goal.

Within this paper four critical

components for achieving effective

employee relations are identified:

The employee relations strategy

Management capability

The employee voice

Internal communication

A successful employee relations

strategy starts with the organisations

leadership, but lives and breathes

throughout the fabric of the

organisation. Through this strategy,

it is vital that senior managers define

the employee relations climate they

wish to create and maintain.

Management capability also has

to be a priority employees are

motivated on a day-to-day basis

by their immediate line manager

rather than the CEO or other senior

managers. Front line managers have

to be equipped to manage people

effectively, fairly and consistently

in line with the organisations

expectations and needs.

To support this, having an effective

and credible way of listening to

employees and acting on what they

say is another vital component to

creating a healthy employee relations

climate. Maintaining a two-way

dialogue is equally important, and

creating the right type and range

of employee voice is as relevant in

non-unionised workplaces as it is in

unionised ones.

Finally, meaningful internal

communication is key to bringing

any employee relations strategy to

life. It is common for employers to

either over communicate, or fail to

communicate enough. Often channels

of communication are out-dated and

the right language for the audience is

rarely used.

This paper is designed to help

employers think through their

approach to employee relations and

consider their current employee

relations position against where

they would like to be. The paper will

introduce a definition of employee

relations, discuss the key elements

to achieving successful employee

relations, and illustrate a matrix on

which organisations can map their

current and future employee relations

climate.

The objective of this paper is to introduce a

standard definition of employee relations and

its four core elements, and to illustrate a simple

matrix tool designed to measure the employee

relations climate inside an organisation.

Executive Summary



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I have felt for some time that there is an absence of a

recognised commonly accepted definition of employee

relations. In some organisations, it has a narrow definition

around the management of policies and handling grievance

and disciplinary cases, while others see it as individual

consultation. In other cases, employee relations are seen as

collective bargaining. We are increasingly seeing roles that

encompass employee relations and engagement, as employers

try to link these two areas.

Overall, 75% of the working population are not covered by

collective bargaining. This means that many managers and

HR people will never actually come into contact with a union

during the course of their working life. However, developing a

good employee relations climate is important in all workplaces,

whether unionised or not, and is no longer something that is

just the responsibility of the HR Department.

As organisations become flatter and the role of the HR team

continues to change, more is being asked of line managers.

The line manager is seen by the organisation as critical to

achieving positive employee relations and the performance

benefits that flow from it, but too often investment in their

development is neglected. We need to define exactly what

employee relations competence is required and use it to startbuilding the knowledge, skills and competence demanded of

the modern manager.

At Marshall-James we also find that measuring the financial

value of employee relations is understandably difficult for

organisations. Conversations with Finance Directors or CEOs

about the cost of poor versus good employee relations can be

challenging in the absence of tangible financial evidence. For

example, whilst it may be easy to quantify the cost of a strike,

most employers in the UK wont experience a strike. However,

there are many other costs of poor employee relations, such as

high absenteeism and turnover, low productivity, and employeereluctance to take part in, or believe in change thereby stifling

any opportunity to generate discretionary effort.

Without an agreed common definition of employee relations, it

is impossible to apply consistent measures across employers,

benchmark and develop best practice and standards.

The purpose of this paper is to suggest that employee relations

is far more than just a narrow definition relating to grievance

or disciplinary. For me, employee relations are best defined as

creating the right climate within the organisation to enable

it to meet its objectives through its employees. Therefore,

the following components must be articulated, developed,

nurtured and maintained:

Employee relations strategy

Management capability

Employee voice

Internal communications

My intention is to start a debate on this subject with a view to

assisting employers to identify their current employee relations

position, where they want to be, and how they can achieve

that goal.

Andy Cook,

Chief Executive, Marshall-James

From Andy Cook, Chief Executive,

Marshall-James Global Solutions Ltd.

For me, employee relations is:

Creating the right climate

within the organisation to

enable it to meet its objectives

through its employees.

Andy Cook, CEO


Introduction


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It should be considered as everything

involved in the relationship between

an employee and their employer. It

is everything that encompasses the

employment framework including

how an employer talks to, involves,

motivates and engages its people.

Most importantly, employee relations

should be seen as holistic; each

component is vital for employers if

they wish to get the best out of their

people, improve productivity, increase

discretionary effort and reduce thetime it takes to manage people issues

and organisational change.

Organisations basing their approach

to employee relations on the above

definition will start to develop

consistency across their businesses

and senior leadership teams. This

should, in turn, help to increase

board level recognition and provide a

uniform basis for discussions relating

to employee relations.

For some, the term employee

relations is seen as a replacement for

industrial relations, but this is not

its correct use. Industrial or labour

relations are terms specifically

relating to the relationship the

employer has with its Trade Unions,

and more often than not will include

collective bargaining of some sort.

While senior organisational leaders

have a key role to play, most employee

relations activities fall to the line

manager, so their capability in this

area has become more important than

ever. According to the Hay Group,

Organisations where people feel

motivated and enabled can achieve

increases in revenue 4.5 times that of

their peers. Therefore, organisations

with good employee relations are

far more likely to perform better

than those that dont that means

delivering better services, making

better products and improvingproductivity.

Employee relations should be defined

as, Creating the right climate within

the organisation to enable it to meet its

objectives through its employees.

Organisations where people

feel motivated and enabled can

achieve increases in revenue

4.5 times that of their peers.

The Hay Group, Engaging for

Success 2009

Employee relations are

everything that encompasses

the employment framework

including how an employer

talks to, involves, motivates and

engages its people.

Andy Cook, CEO, Marshall-James

Global Solutions Ltd

What is

employee relations?



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For organisations to understand the current state

of their employee relations, the following four

areas should be assessed:

Employee relations strategy

Line management capability

Employee voice

Internal communications

As organisations change, evolve and grow, an assessment of the employee

relations environment should be conducted on a regular basis to ensure it

develops, supports or even leads organisational change as illustrated below.

The following sections of this white paper will discuss each of these elements.

The four elements of

employee relations

ClearlyDefinedStrategy

EmployeeVoice

LineManagement

Capability

InternalCommunications



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They instead take comfort from

having an HR strategy, without

thinking about the type of employer

they want to be and how that will

be delivered. An effective employee

relations strategy will enable the

organisation to meet its objectives,

give clarity to managers, and

determine the best way to capture

and manage the employee voice.

Any employee relations strategy

flows from the objectives and goals

of the organisation. It sets out the

style of employee relations to fit the

organisation now and in the future,

bearing in mind the changes and

challenges it is facing. Only once

the strategy has been agreed, can

the work on management

capability, the employee voice and

communications start.

To define the most relevant employee

relations strategy, every organisationshould ask itself the following:

What is the future strategy of the

organisation? Is there a goal to

deliver efficiencies or expand and if

so, what is the potential impact on

employee relations?

How will the organisation tackle

issues relating to changes to

working practices, productivity or

contracts?

How does the organisation expect

its managers to deliver these

changes?

What is the best way to capture the

employee voice through both formal

and informal structures?

How will it approach relationships

with unions, whether current or

future?

What does the organisation want

to communicate with its people and

how is this done most effectively?

All these items are potentially

included in a strategy, and senior

management need to buy into all

the elements in order to bring it to

life throughout the organisation. Of

particular importance is the need for

any strategy to be regularly assessed

and reviewed.

An employee relations strategy need

not be complicated; simplicity is often

best, but it must capture the most

important and significant enablers to

meeting the organisations objectives.

Many employers miss having a clearly defined

and communicated employee relations strategy.

Developing an employee

relations strategy



10/1610 Defining & Measuring employee relations

They must manage conflict, resolve

problems and understand how their

employees are feeling, as well as

influence and motivate their people on

a day-to-day basis. In addition, they

have to meet the demands of their

employer to deliver results.

Managers must have the capability

and tools to be able to manage people

effectively. They are integral to

creating the culture where employees

are encouraged to give their views

because their managers are receptive

to feedback.

It is front line managers who pick up

first when there are workplace issues

to be addressed. These are the people

who, despite the intense pressure they

are often under, are in the best position

to deliver the organisations messages

and objectives. The level of influence

front line managers have on employees

and the impression they createshould not be underestimated. In our

experience, improving and developing

leadership capability amongst frontline

managers is vital.

Despite their prominent role in creating

and maintaining positive employee

relations, trends suggest that poor

line management capability is a

common factor within organisations.

Line managers take their cue from the

management layers above them andcommonly, senior managers are seen as

being out of touch with what actually

happens on the shop floor.

As a result, the knock-on effect

of poor senior leadership on front

line managers needs to be examined

closely. Most employees in medium

and large sized organisations are not

necessarily attached to, or motivated

by, what the Chief Executive says or

does, as their primary relationship is

with their line manager. However, most

senior and middle managers will take

their lead from the executives and so,

whether positive or negative, that will

permeate through the managementstructure to all employees. The

conclusion being that regardless of the

distance between senior executives

and employees, their behaviour and

messaging does find its way into all

areas of an organisation, both directly

and indirectly.

So, what does good front line

management capability look like?

Line managers sit at the heart of the relationship

between the employer and employee.

If I could wave a magic wand,

the one thing I would do is

to improve the relationship

between line managers andemployees.

Dame Carol Black, quoted in

MacLeod and Clarke, Engaging for

Success

Managing the employment

relationship rests heavily on the

shoulders of line managers, but

their competence in this area is,in general, seriously neglected.

CIPD 2011

Marshall-James

Building management

capability

There are many different views and

models relating to this question,

but relating specifically to employee

relations, the following key points

should be addressed:

1. Organisational clarity about what

a good line manager does and the

expectations of them.

2. Clear articulation of the competencies

and behaviours required to be a line

manager and recruiting to them.

3. Commitment to the ongoing training

and development of line managers.

4. Reward systems that encourage

good management, behaviours and

performance.

5. Swift action taken against rogue

managers who undermine the

organisation and its requirements.


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While setting up a formal

mechanism is important especially if

organisations wish to get a collective

view of plans and proposals,

research has shown that the informal

workplace climate appears to have

a stronger influence than collective

consultation machinery on employee

satisfaction and commitment

(CIPD 2011).

True employee voice is embedded

in the organisational culture, and

listens, captures and responds to

the views of individuals and teams

of employees. Complimenting

the formal structures, managers

actively and informally want to hear

their employees views; therefore

it is increasingly important that

employees feel genuinely listened

to by line managers and senior

managers.

Some employers use a union, orunions, as the main mechanism for

the employee voice. In workplaces

where a union is present, employers

are not precluded from creating

another mechanism for listening and

responding to employee concerns

that represent non-union members.

In some organisations, there are

effective hybrid structures where

union representatives and employee

representatives take part together

and others that operate separately.

There are many types of employee

representative bodies that have

been created and used successfully

within organisations. Below are

the recommended principles for

consideration when building a formal

structure:

1. Be clear on the motivation for

creating a formal structure.

2. Define the scope and constitution

in writing. This does not have to

be drawn up by a lawyer usually,

a simple format involving common

sense will suffice.

3. Pay and terms and conditions do

not have to be included and current

arrangements for both are not

necessarily affected.

4. Will one group represent the views

of all employees, or will there

be several, reflecting hierarchy/

organisational structure?

5. Will employees be elected and if so,

for how long?

6. What training will be provided to

representatives and management

and if so, who will provide it?

7. How does any new arrangement

fit with existing arrangements, for

example collective bargaining/trade

unions?

Creating a meaningful and credible employee

voice is another vital component in building

effective employee relations.

Voice systems which combine

direct forms of involvement

with indirect voice via

representative bodies are

strongly associated with

higher levels of organisational

commitment.

Purcell and Georgiades, 2007

The more extensive the range

of voice systems used in

organisations, the more likely

it is that managers report

benefits, from increased output

to declining absenteeism.

Sisson, 2000, quoted in Voice

and Participation in the modern

workplace: Challenges and

Prospects

ACAS, 2012

Enabling the right

employee voice



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They are present in many workplaces,

either through traditional collective

bargaining arrangements, or through

the statutory right for employees

to be represented in grievance and

disciplinary matters by a union.

Trade union membership in the

UK increased during 2013 to 6.5m

members. This is the first increase

in membership for a number of years

and is against a backdrop of very

tough economic and labour market

conditions. The growth came from the

private sector, which has a far lower

union density than the public sector.

But it does highlight that unions in

the UK may not be as irrelevant as

some may argue.

Many employers, particularly those

in the private sector, may hold the

view that they prefer working without

a union. However, there are many

who understand their value and role.

It is often managers with little or no

experience of working with unions

who hold the view that they are to be

avoided, but over the years there have

been a number of examples of the

value of unions, for both employees

and employers.

Unions can positively influence local

problem solving, help line managers

and HR work through difficult

situations, and communicate vital

messages to their membership.

Unions have been known to

recommend unpopular pay deals

and restructures to their members,

where they feel it is in everyones best

interests something which actually

accelerates the delivery of change.

They are also important in terms of

holding management to account.

Unions should play a part and must

continue to do so.

Despite declines in membership, trades unions

continue to play a vital and integral role in

employee relations in the UK.

Firms where managers and

employee representatives

made sincere efforts to solve

common problems had higher

than average productivity

and experienced increases in

productivity.

Cox, Higgins and Speckesser, 2011,

quoted in ACAS 2012

The role of unions in

the employee voice



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It enables the organisation to set

out its goals so that employees

understand where they fit in.

Employers can also build trust and

understanding through internal

communications. Yet many shy

away from communicating, over

communicate, or fail to make

messages connect with their

employees. Some leaders and

managers simply dont have the

confidence to communicate, or in

some extreme cases, they leavecommunication to the trade union.

Organisations want to inform, involve

and inspire their employees, but

few employees are motivated by

logical, well presented argument in

newsletters and company magazines.

Worse still, they can be overwhelmed

by disjointed, inconsistent messages,

and stop listening altogether. On the

whole, people want to feel connected

and proud of their employer. Unless

they feel an emotional connection

through communications, then they

will at best be agnostic, but most

likely negative and cynical about

the organisation.

Management capability is the

cornerstone of effective internal

communications. Senior management

need to buy in to, or create, the

messages, but line managers have to

deliver and reinforce those messages.

This means face-to-face interaction

is vital.

The use of social media and email is

becoming more common for employer

to employee communication. While

it should not replace face-to-face

communications, some organisations

are finding ways to use their

employees interest in social media as

a platform for harnessing their views.

Convenience is not always the best

and most effective option. Think about

three or four key messages and stick

to them over a considered timescale.

Do not deviate or mix them up, and

keep them simple.

The way the organisation talks directly to

employees and delivers key messages is one of

the most important factors in creating emotional

attachment to the employer.

Employee Voice:

Companies that focus

on effective employee

communication achieve up to

47% higher returns

Watson Wyatt Worldwide,

Communication ROI Survey

2009-2010

A Senior Business Leader said:

I am always talking to my

people in great detail, but they

dont seem to understand me

and are not interested. I really

think it is a waste of time

When asked, the employees said:

We just want it to be simple!

On further investigation, this CEO was

communicating a lot and wanted to do

so meaningfully, but took no account

of the fact he was using language not

suitable for the manufacturing plant

he was referring to.

Internal

communications



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However, it is important to

understand where an organisation

is now, and where it wants to be, in

order to begin developing a strategy

to achieve the desired climate.

This unique matrix has been developed

based on the experience Marshall-

James has gained through working with

organisations facing employee relations

and employee engagement issues.

So, by considering the four key

elements of strategy, management

capability, employee voice and

internal communications, where

would you place your organisation on

the matrix below? Whats more, do

you have a clear view on where you

want to be and the strategy you need

to get you there?

Not many organisations are perfect

of course many may be strong in

some areas and weak in others. But

the ability to recognise the areas

that need improvement is a huge

advantage.

This matrix has been designed to

aid senior managers in starting a

debate with their HR teams and line

managers, with the ultimate objective

being to reach a collective view on the

current state of employee relations

in the organisation, and to agree on

the aspirational position. This gives

organisations the best position from

which to develop a relevant employee

relations strategy and to gain senior

management backing for successful

implementation.

Not to be reproduced without permission of Marshall-James.

For an organisation, considering how to assess

their current employee relations can be a

challenge given its intangible nature.

Assessing your current

employee relations

The Marshall-James employee relations Matrix



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Employee relations is an integral

part of the modern workplace.

Each of the four key components has an intricate and dependent relationship with

each other and each one takes time to get right. But, for employers, if the right

time and resources are invested, then they will feel the value in both business and

operational terms.

To help with this, the Marshall-James employee relations matrix gives employers an

opportunity to put a stake in the ground at this moment and then think about where

they want to get to. It defines a starting point for further analysis on the risks and

issues within the business, and visually represents the disparity between now and

the future. The journey to get there is the interesting and challenging part.

We would like to hear from employers who are either or both:

1) Interested in benchmarking employee relations in their organisation working

with us to collect data on employee relations within your business.

2) Happy to share with us where they are on the matrix, and where they want to be.

All information shared will be treated as confidential.

If you would like to get involved or have any feedback on anything contained in this

paper, please email [email protected] [email protected]. Alternatively, please

call us on+44 (0)20 3021 3970if there is anything specific you would like to discuss.

We are a niche professional services firm specialising in working with domestic

and multinational employers on all areas of employee relations, labour/industrial

relations, human rights at work and corporate social responsibility in the UK and

globally both strategy and delivery. We always advise our clients to behave in

a way that is moral and ethical, whilst doing what is right for the business and

stakeholders.

Conclusion



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For more information call us on:

or email: [email protected]+44 (0) 20 3021 3970

Marshall-James Employee Relations Ltd

Kent House, Upper Mulgrave Road,

Cheam, Surrey, SM2 7AY

We are a niche professional services firm specialising in working with domestic and multinational employers on all areas

of employee relations, labour/industrial relations, human rights at work and corporate social responsibility in

the UK and globally both strategy and delivery. We always advise our clients to behave in a way that is moral

and ethical, whilst doing what is right for the business and stakeholders.

Documents

MJ White Paper AW