The Cost of Workplace Conflict and Three Take-aways for Employers

According to a new report from ACAS the estimated cost of workplace conflict to UK organisations is £28.5 billion a year – the equivalent of more than £1,000 for every employee. Workplace conflict is likely to be a hot topic for employers for the rest of this year with the continued easing of lockdown restrictions, the gradual return of employees to the workplace, economic pressures and possible organisational and operational changes having the potential to lead to workplace conflicts arising.

So, what are some of the findings of the ACAS report and are there any take-aways for employers?

Key Findings

The report made a number of findings relating to just before the pandemic took hold including:

  • An estimated 9.7 million employees experienced workplace conflict in 2018-2019.
  • 40% of employees who experienced conflict at work reported being less motivated and 56% reported stress, anxiety and/or depression. The vast majority who suffer from stress, anxiety and depression continue to work. This ‘presenteeism’ has a negative impact on productivity and an annual cost estimated to be between £590 million and £2.3 billion.
  • Sickness absence resulting from workplace conflict is estimated to cost UK employers £2.2 billion each year.
  • An estimated 485,800 employees resign each year due to conflict at work. The cost of recruiting replacement employees amounts to £2.6 billion each year, with the cost of lost output as new employees get up to speed amounting to £12.2 billion.
  • There is an estimated average of 374,960 formal grievances each year and 1.7 million formal disciplinary cases. The average cost in management time of a formal grievance is estimated at £951.
  • The total cost of management time spent dealing with potential and actual litigation is estimated at £282 million each year, with a further £264 million spent on legal fees.

These findings show why it’s important for employers to be alert to workplace conflict. Whilst it can’t always be avoided – for example formal disciplinary action is sometimes necessary – there are some steps employers can take in their organisation to help prevent and where necessary, manage conflict appropriately.

Three Take-Aways

When it comes to workplace conflict it’s a good idea for employers to:

  1. Upskill managers – As managers are on the frontline it’s important to ensure they have the skills they need. This is not only in terms of being empowered to manage day to day employment issues, such as those regarding performance appropriately and effectively, but also to provide training where needed in core people skills. This can help to minimise the risk of matters inadvertently developing into a conflict, for example by ensuring there is clear and appropriate communication, and support managers to approach any issues more effectively.
  1. Act early – If a concern is identified, whether with an employee’s conduct or performance or an employee raises an issue it’s important to act early to try to address it. If matters are promptly addressed they can often be easier to resolve and less likely to escalate.
  1. Repair and improve It’s important to be open to taking appropriate steps to repair relationships with, or between, employees where appropriate. For example, if an employee has raised a valid grievance identifying what action is needed to remedy the situation and prevent a re-occurrence will be vital. It’s also helpful for employers to review workplace practices and policies to identify whether improvements can be made that could help to reduce the likelihood of unnecessary workplace conflict arising.

If you have an employment matter you would like assistance with, please do not hesitate to contact Kingfisher Professional Services Ltd as we are happy to help.