Employee Involvement and Participation - benefits and potential pitfalls!
It's often argued that effective employee dialogue can help staff feel more involved and valued by their employer, make them better aware of the business climate in which the organisation is operating and help them be more responsive to and better prepared for change. This in turn will benefit the business through improved efficiency, better staff retention, lower absenteeism, increased innovation and adaptability to change. However, increasing employee involvement can be problematic. In this article, we provide a brief overview of the positives, and the pitfalls, of encouraging employee involvement and participation in your workplace.
Employee Involvement
This concentrates on individual employees and enabling them to influence the management decision-making processes. It can consist of downwards communication from management e.g. newsletters, staff handbooks, internet/intranet communications, team briefings and notice boards. Alternatively it can include upwards communications from employees to management through quality circles, employee attitude surveys or employee recommendations.
Employee Participation
In its broadest sense this is about employees being able to collectively bargain over their terms and conditions of employment. There are several methods an organisation can choose to adopt including setting up Joint Consultative Committees or board level representation from employees. However, employee participation is also governed by employment legislation including:
- The European Works Council Directive which requires a Europe-level information and consultation system to be set up in all organisations with more than 1,000 employees in member states and employing more than 150 people in each of two or more of those member states.
- The Information and Consultation of Employees Regulations Act which gives employees the right, subject to certain conditions, to request that their employer sets up or changes arrangements to inform and consult them about issues in the organisation for which they work
An organisation may also introduce financial participation which can include profit sharing, profit-related pay and share ownership schemes to encourage greater performance from employees.
Considerations
Whilst there are clearly perceived benefits from engaging in employee participation and involvement (EPI) there are some potential pitfalls that need to be considered.
- Organisations often assume that employee attitudes are all the same towards EPI when actually factors such as age, gender, race and contract status may have an significant impact. For instance, some workers may exhibit a preference for financial participation whereas others would respond more positively to extra control over their job or a say in company decisions.
- There is some evidence that certain types of EPI and the way they are implemented can produce or increase worker dissatisfaction with the organisation. For instance, after an initial 'honeymoon' period, employees may express more dissatisfaction than before because of raised and unmet expectations of employee influence. A workforce may also feel resentful about the amount of time, effort and increased responsibility involved in a participation scheme, especially if they see little return from management. Where participation is only in one direction, from the top down (e.g. through briefing meetings) workers may feel that their views are not being considered or given any weight leading to increased hostility towards management. Where one-way communication is from the bottom up, for example through suggestion schemes, workers may feel that their ideas are being used but with no reward. Lastly, where schemes have been introduced without prior worker consideration, resentment may occur.
- Perhaps the most important issue to consider when implementing EPI is the quality of decision-making that will result and whether this will be slower than usual. There is also the contention that, where employees have decision-making rights, their decisions will be income maximising and not profit orientated. It may also prompt employees to question management decisions over their working lives that they would not otherwise have considered.
In today's workplace, with the trend towards greater individual responsibility, it is increasingly important that employees have an understanding not only of what they are required to do and why they need to do it, but also have the opportunity to influence what happens to them at work. If EPI is to work, organisations have to get it right: implementation is of crucial importance and there should be clear communication channels and appropriate methods chosen. Do this, bear in mind the above considerations, and you will be well placed to reap the full benefits of EPI with none of the pitfalls.
For further information about introducing EPI methods in your organisation please contact Jenny.Hourican@hradvantage.co.uk or phone 01494 451681.
May/June 2007
