The cost of workplace conflict
Author: Antonia Rogers, Acaria Associate
Today’s cost of living crisis is not only affecting individuals but has a profound effect on companies who are tasked with balancing the budget whilst meet employees increasing demands for higher wages. Trade Unions have felt compelled to call for strike action from their members in order to have their voice heard and according to the office of national statistics, in total, an estimated 2.472 million working days were lost between June and December 2022 due to strike action alone. In May 2023, inflation rose to a staggering 7.9%. This crisis is putting immense pressure on all of us and with tensions heightened and as individuals battle with external pressures, it is inevitable that this will spill into the workplace. So not only are companies having to deal with the pressures of a cost of living crisis on its products and services but the fall out of that within the workplace.
In this article we look at the real costs of conflict in the workplace and pose the question that, especially in today’s world, can your business really afford to ignore conflict in the workplace and provides the business case for identify the issue, take swift and early action and ensure that your employees remain efficient and productive in the workplace. Let’s have a look at the facts and figures.
In the last CIPD Workplace Conflict Survey in 2019, it was reported that 29% of employees, 9.7 million, have first-hand experience of conflict in the workplace costing UK companies a staggering £28.5 billion a year.
When we look at those statistics further out of the 9.7 million employees identified approx:
- 5% resigned as a result of the conflict
- 9% required time of sick
- 19% reported a drop in productivity
- 40% reported reduced motivation, commitment and engagement
- 56% reported suffering from stress/anxiety and depression.
Translating these statistics into a monetary figure the report concluded that the cost of:
- Resignation (factoring in also the cost of recruitment, training, and the loss of output) was on average £25,181 per resignation
- Sickness Absence was on average £148 per day, per employee
- Negative impact on productivity and reduced engagement and wellbeing was on average £238 per day, per employee.
The report all looked at the real cost of conflict within the workplace in four different scenarios and the figures speak for themselves.
Scenario 1: conflict unseen
Scenario 2: early informal resolution
Scenario 3: effective procedures
Scenario 4: the worst case?
Independent research – Estimating the costs of workplace conflict
Published 11 May 2021
Mediation in the workplace is proven to be the quickest and most cost-effective way to address conflict in the workplace. It allows parties to speak confidently in a safe and secure environment and encourages a mutual understanding in how to improve working relationships. It focuses on trying to address underlying causes of conflict and has a win/win emphasis, supporting both sides of a dispute to find solutions that are acceptable to each side. It therefore encourages more positive outcomes in the workplace than more traditional adversarial formal processes which are therefore more likely to be adhered to in the short and long term. Acaria Coaching and Consulting Ltd, provides mediation services using its own experienced mediators. If you are interested in finding out more, please contact us and will be happy to discuss your requirements with you.