ACAS has produced a new report called ‘Estimating the cost of workplace conflict’. It presents a snapshot of how conflict can affect businesses and the potential costs that may be involved. The report says that in 2018 to 2019, 9.7 million UK employees experienced conflict at work. Only 5% of those resigned, leaving a lot of unhappy people at work. Of those who remained at work, 40% said they felt less motivated as a result. The recruitment and training of new staff to replace those who have left due to conflict costs businesses around £14.9 billion per year. Conflict related sickness absence cost £2.2 billion.
The report estimates that the cost of management time in dealing with a formal grievance is £951, the average cost of a disciplinary process is £1141. The cost of management time in dealing with tribunal complaints is about £282 million a year, with £264 million spent on legal fees. The report estimates that the overall cost of conflict to employers in the UK each year is £28.5 billion. That figure shows that conflict can be eye wateringly expensive. At a time where businesses are already struggling, this report offers ideas about how to reduce conflict and its associated costs.
The report gives three strong messages:
- Good management – managers must be ‘conflict competent’.
- Timing – line managers should spot and intervene in conflict situations well before formal processes have started.
- Creativity – there is a natural opportunity for improvement and change where the status quo is challenged, which is a common cause of conflict at work.
Businesses should focus on effective and early resolution of workplace disputes to nip potential problems in the bud, especially when dealing with poor performance and sickness absence. The report suggests disciplinary matters should focus on learning rather than blame. The ultimate aim – for many reasons, not just cost – is to move towards resolving disputes in the workplace rather than in the employment tribunal.
Find the report at https://www.acas.org.uk/estimating-the-costs-of-workplace-conflict-report
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