Workplace conflict costs UK employers £28.5 billion each year which is an average of just over £1,000 per employee according to a report recently published by ACAS.

Workplace conflict can be expressed in many ways. It can stem from a disagreement between people or from across a wide spectrum of behaviour, ranging from a personality clash to more serious issues such as bullying and harassment.

Obvious sources of conflict include (but are not limited to):

• Bullying and harassment
• Discriminatory behaviour
• Poor performance
• Unacceptable language
• Drink or drug problems

Other less obvious sources include (but are not limited to):

• Differences in personality style or working
• Taking credit for other peoples’ work
• Not valuing other people’s view, background or experiences
• Ignoring people or being discourteous
•  Talking over people in meetings

It is often the less obvious issues that, over time, lead to workplace conflict if not tackled directly.

Recent statistics (2018 – 2019 – before the pandemic) have shown that it is beneficial to deal with workplace conflicts on an informal basis. The statistics show that the majority of employees who experience workplace conflict stay with their employer whilst 5% of employees resign from their position and 9% of employees take time off work as sickness absence. However, 40% of employees reported being less motivated than usual and 56% reported stress, anxiety and/or depression as a direct result from workplace conflicts.

Prevention is better than cure

The negative effects of workplace conflict can include work disruptions, decreased productivity, project failure, absenteeism, turnover and termination.

Dealing with workplace conflicts on an informal basis costs UK employers £231 million each year. Carrying out a formal grievance process costs the economy £2 billion every year. If grievances can be avoided and conflicts dealt with informally, this could be a significant saving to UK businesses. This does not take into account any aggrieved employees bringing employment tribunal proceedings to find an amicable solution.

Conflict is likely to exacerbate and strengthen if it is ignored. Handling conflict in a proactive and positive way can help improve team morale, retain valuable skills and talent and reduce sickness absence. There are several steps which can help prevent conflict from arising in the workplace.

• Get to know the team better
• Be aware of simmering tensions
• Acknowledge when a team member is causing stress to others
• Be clear about your expectations of team conduct
• Try not to get involved in office politics or gossip

Policies and Practice

Investment in effective early resolution designed to build positive employment relationships may have a very significant return. The average costs of conflict where employees did not engage with their managers, HR or union representatives were higher than where such discussions took place.

Businesses therefore 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. The results provide strong arguments for a rebalancing of policy – decreasing the emphasis on legal compliance and effectiveness of the tribunal system, towards the resolution of conflict within businesses.
• Make certain that policies and communication are clear and consistent and make the rationale for decisions transparent.
• Ensure that all employees and not just managers are accountable for resolving conflict.
• Do not ignore conflict, and do not avoid taking steps to prevent it.
• Seek to understand the underlying emotions of the employees in conflict

Keep in mind that approaches to resolving conflict may depend on the circumstances of the conflict. The negative effects of workplace conflict can include work disruptions, decreased productivity, project failure, absenteeism, turnover and termination. Emotional stress can be both a cause and an effect of workplace conflict.

Covid-19

The result from the ACAS report details the issues and costs before the first lockdown took place in March 2020. With the UK on it’s way out of lockdown and employees who have been working from home returning to work, the statistics for workplace conflicts is likely to increase. This is due to businesses adapting to a new normal and problems that had been suppressed during the pandemic by having employees work from home can resurface. A more sustained shift to remote working and the potential acceleration of automation will create new challenges for the effective management of people, placing a premium on the skills needed to prevent, manage and resolve conflict.

If it is obvious that informal discussions are not going to help workplace conflicts, businesses will need to rely on their staff handbook and policies to resolve any issues. Businesses need to make sure that their equality and diversity policy, grievance policy and disciplinary policy, among any others, are up to date and available to all members of staff. This will, in the long run, help businesses save money by ensuring that they are prepared for any eventuality and certifying that they have policies and procedures in place should any formal discussions be necessary.

For further advice and assistance on the contents of this blog, please contact Sarah Collier, Partner & Head of Employment Law.

The full ACAS report can be found here.