How companies can tackle employee disengagement

Busi­ness­es around the world are grap­pling with prob­lems caused by declin­ing employ­ee engage­ment – and British firms are no excep­tion. Only 9% of UK employ­ees felt engaged in their work in 2019–21, accord­ing to Gallup’s lat­est annu­al State of the Glob­al Work­force report. Its researchers placed the coun­try 33rd out of the 38 Euro­pean states rat­ed on this mea­sure – a drop of two places on its 2018–20 rank­ing. 

The last­ing impact of the Covid cri­sis on the psy­cho­log­i­cal con­tract between employ­ees and employ­ers has been one of the main fac­tors caus­ing this high lev­el of dis­en­gage­ment, which is man­i­fest­ing itself in the so-called qui­et quit­ting trend. 

Breach of contract

Unlike a for­mal con­tract of employ­ment, the psy­cho­log­i­cal con­tract is an unwrit­ten (and gen­er­al­ly unspo­ken) set of mutu­al expec­ta­tions. Under­pin­ning these is the under­stand­ing that, if an organ­i­sa­tion invests in an employ­ee – by pro­vid­ing perks, career devel­op­ment oppor­tu­ni­ties and a vibrant organ­i­sa­tion­al cul­ture, for instance – that per­son gives their all to their employ­er in return. 

But, since the psy­cho­log­i­cal con­tract is uncod­i­fied, it exists in a del­i­cate state of flux and is vul­ner­a­ble to socioe­co­nom­ic shocks. This hap­pened dur­ing the ear­ly months of the Covid cri­sis in 2020. Prac­ti­cal­ly overnight, thou­sands of com­pa­nies were oblig­ed to shut up shop and many employ­ees found that their work had either changed dra­mat­i­cal­ly or dis­ap­peared alto­geth­er.

The social side of work also van­ished, replaced by online meet­ings where the focus was often sole­ly on the task at hand, rather than on build­ing rela­tion­ships and gen­er­at­ing team spir­it. 

Antho­ny Klotz is asso­ciate pro­fes­sor of man­age­ment at Uni­ver­si­ty Col­lege Lon­don. He believes that a busi­ness must first appre­ci­ate each employee’s unique expe­ri­ence of the past two years if it’s to repair the psy­cho­log­i­cal con­tract. 

“What’s chal­leng­ing is that there isn’t a one-size-fits-all approach that will solve all your engage­ment issues. That’s because every­one has been expe­ri­enc­ing the pan­dem­ic dif­fer­ent­ly,” Klotz says. “Imag­ine that you have three peo­ple report­ing to you. One may have been expe­ri­enc­ing burnout, the sec­ond may have had an epiphany and wants to climb the career lad­der, while the third may want a bet­ter work/life bal­ance so that they can spend more time with their kids. The chal­lenge for lead­ers is to under­stand which types of invest­ment are like­ly to make each indi­vid­ual rec­i­p­ro­cate with high­er lev­els of engage­ment.” 

A sense of detachment

If employ­ers are to gain the insights they require to come up with suit­ably tai­lored solu­tions, they must com­mu­ni­cate more effec­tive­ly with their staff. The Covid cri­sis has loos­ened con­nec­tions between organ­i­sa­tions and their employ­ees. Research by OC Tan­ner, a spe­cial­ist in employ­ee recog­ni­tion, indi­cates that a third of employ­ees feel dis­con­nect­ed from their lead­er­ship teams. 

The wide­spread adop­tion of remote work­ing is one rea­son for this. Although the hybrid work rev­o­lu­tion is democ­ra­tis­ing employ­ment oppor­tu­ni­ties across the coun­try, it’s also increas­ing both the phys­i­cal and psy­cho­log­i­cal dis­tance between employ­ees and employ­ers. Tra­di­tion­al bond­ing expe­ri­ences such as com­pa­ny social events have become rar­er under this new mod­el. 

Dr Ash­ley Wein­berg, senior lec­tur­er in psy­chol­o­gy at the Uni­ver­si­ty of Sal­ford, believes that the use of employ­ee forums could solve some of the prob­lems caused by remote work­ing. He sug­gests that people’s con­tri­bu­tions to these forums should be anonymised so that they feel com­fort­able voic­ing any con­cerns. A nom­i­nat­ed well­be­ing rep­re­sen­ta­tive should be the con­duit between the mem­bers and the senior lead­er­ship team.

If this solu­tion is to work prop­er­ly, employ­ees must be sure that their lead­ers are not only lis­ten­ing but also able and will­ing to enact any sug­gest­ed changes, Wein­berg warns.

“There always needs to be dia­logue between an employ­er and its employ­ees,” he says. “Trust is at the root of the rela­tion­ship. If you’re not con­sis­tent over the long term, your employ­ees aren’t going to trust you. You can’t do some­thing for a few months and then trail off. You must keep invest­ing in your people’s well­be­ing.” 

The great resignation 2.0?

The so-called great res­ig­na­tion that occurred in the months after the pan­dem­ic lock­down restric­tions were lift­ed was dri­ven by the release of pent-up demand to move jobs as the UK emerged from the depths of the Covid cri­sis. There is a sig­nif­i­cant chance that his­to­ry will repeat itself once the reces­sion that’s wide­ly expect­ed next year eas­es. 

In times of great uncer­tain­ty, peo­ple tend to stay with their employ­ers to ride out the storm, although they won’t nec­es­sar­i­ly be any more engaged in their work. Once the eco­nom­ic out­look improves and con­fi­dence returns, they may well move again in large num­bers. On the flip side, if employ­ees are adopt­ing a ‘wait and see’ approach as anoth­er down­turn looms, it gives com­pa­nies a win­dow of oppor­tu­ni­ty to re-engage them. 

Klotz believes the best way for com­pa­nies to do this is by con­cen­trat­ing on the basics of engage­ment and clear­ly com­mu­ni­cat­ing how the busi­ness cares about work/life bal­ance and recog­nis­es each employee’s con­tri­bu­tions. 

“Free beer or oth­er perks that extend the work­ing day are not a win­ning strat­e­gy. You want your employ­ees to lead rich lives out­side work; you don’t want it to be all things to them,” he argues. “But you do want employ­ees to bring their whole selves to work. Treat­ing them fair­ly will achieve this. Adopt­ing a com­part­men­talised vision of work makes more sense than ever. What we’re hear­ing from employ­ees is that they want their work to fit around their lives, not the oth­er way around.”

James Reed, chair­man of Reed Recruit­ment, agrees. He thinks that employ­ers need to adjust their offer­ings in line with the eco­nom­ic sit­u­a­tion and the new expec­ta­tions of their employ­ees. 

“Busi­ness­es that can’t match the salaries their com­peti­tors are offer­ing should focus on improv­ing job sat­is­fac­tion by lis­ten­ing to their employ­ees’ pref­er­ences,” he advis­es. “This might involve offer­ing more flex­i­ble work­ing options, pro­vid­ing enhanced men­tal health sup­port and expand­ing career devel­op­ment pro­grammes.”

Businesses around the world are grappling with problems caused by declining employee engagement – and British firms are no exception. Only 9% of UK employees felt engaged in their work in 2019-21, according to Gallup’s latest annual State of the Global Workforce report. Its researchers placed the country 33rd out of the 38 European states rated on this measure – a drop of two places on its 2018-20 ranking. 

The lasting impact of the Covid crisis on the psychological contract between employees and employers has been one of the main factors causing this high level of disengagement, which is manifesting itself in the so-called quiet quitting trend. 

Breach of contract