The recent all-important ACAS (1) report (2) which is considered below not only calculates the considerable cost of workplace disputes in the UK but also demonstrates that such occurrences are very widespread and are not, as they should be, identified at an early stage. As well as considering the financial and other implications of this report, this article also explains how the highly accomplished ASM Plus Workplace, Employment and Investigation team can help individual employers and organisations.
In the course of approaching employers and organisations and telling them about the services provided by the ASM Plus Workplace, Employment and Investigation team I not infrequently find myself receiving a sort of “in denial” response. The jist of this response is that although the concept of the workplace dispute is not unheard of, it doesn’t happen “here”.
In some instances, it may be true that at least at the point of enquiry one organisation or another may not have “any disputes” or there may be effective mechanisms in place to resolve them informally, cost effectively and without rancour. However, as the ACAS report clearly demonstrates, instances of “no disputes” or “summary and effective dispute resolution” are undoubtedly the exception rather than the norm.
Until recently, getting hold of clear, persuasive data to counter protestations of the “no workplace related disputes here” genre has been difficult. Including as it does the following very pertinent eye-opening statistics, the ACAS report changes all that. For instance:
- An estimation that 9.7 million employees experienced [workplace related] conflict in 2018 and 2019.
- On average 485,800 employees resign each year as a result of conflict. The cost of recruiting replacement employees amounts to £2.6 billion each year whilst the cost to employers of lost output whilst new employees bring themselves up to speed amounts to £12.2 billion, an overall estimate of £14.9 billion each year. A further 874,000 employees are estimated to take sickness absence each year as a result of conflict, at an estimated cost to their organisations of £2.2 billion.
- The vast majority of those who suffer from stress, anxiety and/or depression due to conflict continue to work. This ‘presenteeism’ has a negative impact on productivity with an annual cost estimated between £590 million and £2.3 billion.
- 1 in 5 employees take no action in response to the conflict in which they are involved, while around one-quarter discuss the issue with the other person involved in the conflict. Just over half of all employees discuss the matter with their manager, HR or union representative. In total, informal discussions cost UK organisations an estimated £231 million each year.
- The largest proportion of the costs of conflict are connected to an ending of the employment relationship – either through resignation or dismissal. Costs in the early stages of conflict are relatively low – these start to mount if employees continue to work while ill and/or take time off work through sickness absence. The use of formal processes pushes costs higher but costs escalate very quickly as soon as employees either resign or are dismissed.
- This analysis estimates the overall total annual cost of conflict to employers (including management and resolution) at £28.5 billion.
In real terms the cost of these ostensibly well researched and realistic estimates is the equivalent of just over £1,000 for every employee in the UK each year, and just under £3,000 annually for each individual involved in workplace related conflict. It points to a clear link between the wellbeing of employees and organisational effectiveness although it would appear that in many instances that link is either broken or non-existent.
This report also makes it abundantly clear that employers who are “in denial” about workplace disputes no longer have anywhere to hide and may be very unwise to blandly assume that “disputes only happen to other people”.
However, notwithstanding these very pertinent statistics the report strikes many positive notes and amongst its recommendations, includes the following highly significant recommendation:
“Organisations need to place much greater emphasis on repairing employment relationships in the event of conflict and taking action at early points to address issues of capability and poor performance. In addition, the analysis provides support for approaches to disciplinary issues that focus on learning and avoiding blame. However, to achieve this, managers need to be provided with the core people skills to have quality interactions with their staff.” (3)
In some instances, individual organisations will feel able to address these recommendations internally and they will have the expertise and resources to do so. Others will lack both the requisite expertise and the necessary internal resources and with the above-mentioned statistics very firmly in mind will need outside help. In this regard the highly accomplished ASM Plus workplace, employment and organisational team offers a number of cost-effective services that can help organisations in all sectors to address the recommendations set out above. To reap the benefits of improved working practices and increased productivity we offer:
- An independent and confidential mediation service
- The alternative of a facilitated meeting
- A training, coaching and consultancy advice
- An independent and confidential investigation service
Our considerable experience tells us that individual members of internal HR departments are often very capable and quite frequently will be well placed to address workplace disputes and disagreements. However, in some instances they may be perceived of as not being sufficiently objective and independent. This means that possibly mistrustful parties to workplace disputes whether employers, directors, managers, supervisors or employees may not feel able to open up and be as candid and frank as they should be. Equally, because invariably HR input is not truly confidential, people are often very wary about making statements that will be recorded and may “be used against them” whether contemporaneously or at some later date.
The services offered by ASM Plus mediators are completely neutral and independent. Because we are efficient and respond promptly our charges are modest. Above all ASM Plus has a highly talented and highly experienced team and as our associates’ track records amply demonstrate we have the skill and expertise to help clients resolve disciplinary issues, to improve staff performance and to save employers and employees alike from being part of the annual £28.5 billion statistic.
(1) ACAS the Advisory, Conciliation and Arbitration Service) is a Crown non-departmental body of the Government in the United Kingdom. Its purpose is to improve organisations and working life through the promotion and facilitation of strong industrial relations practice. ACAS provides employment law and employment relations advice for employers and employees through its website and helpline. It also offers dispute resolution services such as arbitration or mediation, although the service is perhaps better known for its conciliation function – that is resolving disputes between groups of employees or workers, often represented by a trade union, and their employers.
(2) “Estimating the costs of workplace conflict” May 2021
(3) My italics
Principal Director of ASM PLUS, civil/commercial, workplace, employment, family and educational mediator and trainer with a judicial/legal background. He has knowledge and expertise in dispute resolution in a wide range of areas and disciplines and mediates online.