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Three common employee relations issues and how to overcome them 

Customer relations are a focal point for small businesses. Building a loyal client base is essential for repeat business, referrals and for establishing the positive reputation of your business. But what about your relationship with employees and their relationships with each other?

The small friendly and family-like workforce in a small business doesn’t tend to get much thought, especially while everything is ticking along nicely. There is often an absence of any conflict, greater flexibility and a family-like atmosphere in a small firm. Formal employee relations just doesn’t seem necessary.

However, as a business begins to grow, things change. Most entrepreneurs underestimate the importance of employee relations when they set out with their business idea. Ignoring its importance is a mistake.

Building a strong and positive relationship with your employees isn’t easy, but it should be firmly on the agenda from day one.

In this article, we’ll be exploring the most common problems small business owners face when it comes to employee relations. First, let’s take a look at what employee relations means.

What are employee relations?

Employee relations is the term used to define the relationships between employers and employees. Once coined as industrial relations (in the days of manufacturing and strong trade unions), employee relations refer to a company’s efforts to manage relationships in the workplace, both individually between employer and employee and collectively.

The Chartered Institute of Personnel and Development (CIPD) are keen to impress upon small businesses the value of good employee relations. “A positive employee relations climate and high levels of employee engagement have the potential to lead to enhanced business outcomes as well as better health and well-being for employees.”

This includes paying attention to the mechanisms that support good employee relations, such as the use of employee engagement surveys, and generally working in partnership with employees.

Employee relations also covers many HR policies, such as fair pay, benefits, work-life balance, reasonable working hours and ensuring all work policies are fair and consistent in the workplace. Employee relations is all about how you treat your employees and how to keep them loyal, working in harmony with each other, and engaged in their work.

The most common areas of employee relations small businesses overlook or don’t get to grips with include:

·         Training and development

·         Conflict management

·         Change management

Let’s take a look at each of these in more detail.

Training and development

It is common for small companies to focus on developing the business without much thought about developing employees. Small businesses don’t have the luxury of having a department to look after training and development and this is why this area often gets far less attention than it should.

But the training and development of employees is a crucial lever for business success, especially for small enterprises who are unable to compete with the salaries offered by larger corporations. A proper training and development programme contributes to happier and more productive employees. It is essential for innovation and vital for staff retention.

Do not forget about your employees and let them exist in a vacuum. Let employees become bored in their jobs and they will eventually seek more satisfying employment elsewhere. Broadening the career scope for your employees gives them confidence, helps them to innovate, makes their job roles more enjoyable, improves productivity and is vital for the success of your organisation.

Best practise tips: Start by writing a training plan and identifying skills gaps. The point at first is to ensure every employee has the skills they need to do their job well. Don’t waste people’s time with training they don’t need. Do have one-to-one’s with employees to understand what their training aspirations are.

It doesn’t have to cost a fortune to train employees - your most skilled and competent employees are a great training resource.

Managing and resolving conflict

Conflict in the workplace happens in all businesses at some point or another. How you manage conflict is vital to the culture of your organisation. Badly managed conflict with an employee can result in poor company morale and a toxic work culture.

Challenging employees to tell them about a problem with their work isn’t an easy task. Underplay it and you are being creepy and disingenuous. Be too forceful and use the wrong language and you will almost certainly create a vicious cycle of discouragement and a self-fulfilling prophecy of failure.

Best practise tips: No matter what the cause of any conflict, deal with it immediately and focus on the issue, not the person or people. If the conflict is between two of your employees, hear each person’s point of view and ask them for proposed solutions (meet with them separately and together). It’s really important you don’t take sides.

Encourage employees to work things out with each other – you don’t want the same people knocking on your door every time a potential conflict arises. Having a formalised framework for resolving conflict can be helpful. Problems are usually the cause of processes rather than people per se, so set up procedures for dealing with complaints to prevent a blame game.

Always remember that a well-timed apology when things go wrong is an incredibly powerful way to move things on. There is actually a lot SME leaders can do to avoid the cost of conflict.

Change management

Many small businesses focus on the operational side of change management as a business grows. They forget about the importance of managing people through change. When a small business expands, processes change. The boss moves into an office, people get promoted (sometimes into management positions they aren’t trained for), and new people are brought in. The way things are done also change.

It is a critical, difficult and essential process for any small business evolving into a medium-sized enterprise. But change is an unsettling time for employees and it requires buy-in from them.

Best practise tips: Keep staff informed of impending changes and open a dialogue with them to discuss ideas. Don’t overwhelm staff with information. Keep communication about change clear and concise and ask employees for feedback. Focus on the benefits and don’t let communication slide once changes have been implemented.

Ashleigh Smith
Article by Ashleigh Smith
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