Managing workplace conflict

Blogs 6 Jul 2022

Clare Chapman (Chair, Acas) and Martin McTague (National Chair, Federation of Small Businesses) answer questions around how to handle conflicts in the workplace.

Q: Managers are often worried about starting difficult conversations. Any tips on how to start them well?

Martin McTague: Small business employers often have close personal relationships and bonds with their staff due to their small teams which can lead to easier conversations on topics such as flexible working. 

However, difficult conversations are hard for any employer. I think it’s a good idea to take some time to plan the conversation but try to keep it less formal. Focus on the facts and provide clear information.

Clare Chapman: I echo what Martin says about the importance of planning. Preparation won’t necessarily remove the tension or sensitivity, but it can help keep the conversation on track, and be clear and constructive. Acas guidance sets out the kind of preparatory steps that help. Our training identifies four stages to delivering an effective, difficult conversation: 

  1. Opening – Introduction, make eye contact (avoid scripts), ask about the issue, and ask for specific example(s) to help understand concerns and discuss why is it important to find a resolution. 
  2. Sharing – Invite the other party to share their views, ask questions and listen. Be sure to convey that you are interested in understanding the issue(s) and keep the conversation on track.
  3. Resolution – Develop options jointly and summarise them ahead of clarifying the actions for all the parties, Importantly, commit to reviewing the outcomes.
  4. Review – Avoid the temptation to simply move to the next issue of the day. Take a moment after the conversation to reflect what’s been learned, and what you might do differently next time. 

It’s also worth remembering that annual performance review discussions are a useful moment to ask about what’s going well and what needs work - particularly if you wait and ask the questions once you have both relaxed into the conversation. 

Q: Do you think that part of the reason managers are reluctant to deal with conflict informally is because they want to avoid a difficult conversation or because they do not want to fall foul of the law?

Clare Chapman: Both! Often it is a matter of confidence. How often do we simply delay taking action as we feel anxious about it? This is all very understandable, but the truth is that a problem avoided rarely goes away and can get worse. 

Employers can turn to the Acas helpline and website to find out the basics on employment law. And there is always space in a conversation to say, “I will look into that and get back to you”. 

But perhaps the key to success is not simply to seek to ensure legal compliance, but also to follow good practice and to build trust. Think about the relationship for the future, not just the now.

Martin McTague: Worries over potentially falling foul of the law definitely play a large role. Understanding employment law can be particularly challenging for small businesses who, unlike larger organisations, are far less likely to have a HR or legal department. Employment case law is constantly changing alongside legislation, with employers unable to keep up.

Q: How do you get directors or owners to stop making decisions prior to following processes for investigation? 

Martin McTague: Larger businesses often have in-house lawyers or legal teams that they can call upon. These lawyers will have a sophisticated understanding of the range of options that are available to them in resolving a dispute.

For small businesses, it is a different story. Any spare resource is targeted at meeting key legal requirements. Therefore, small businesses are more susceptible to sudden shocks, like the need to deal with a legal dispute.

Owner/managers of small businesses are under intense time pressure and can make process mistakes when dealing with conflict. It is important that they have a trusted source they can turn to at these times. FSB’s HR advice line is open 24/7 and staffed by employment solicitors. They are experts at providing guidance through difficult conversations – including performance reviews, grievances, or disciplinaries.

Clare Chapman: The short answer is not to let panic get in the way of good decision making.

Investigations are a vital part of any disciplinary process since they help identify the facts of a case. Their use is set out in the Acas Code of Practice on Disciplinary and Grievance Procedures. The way that an employer behaves will be taken into account if the case reaches an employment tribunal. And if the employer is found to have unreasonably failed to follow the code, they could be liable for a 25% uplift on any awards made.

Q: What advice do you have for small or micro businesses with no HR department or union reps? How can we ensure conflict is being managed well?

Clare Chapman: The principles to manage conflict well remain the same regardless of size of the organisation. I’ve found the following checklist useful:

  • Are there opportunities for regular communication? Asking questions (and actively listening to the answers) is a great way to help avoid misunderstanding and build trust. 
  • Are there good methods for understanding customer and staff feedback? Putting yourself in the shoes of the people you rely on requires that you know enough about their needs, interests and motivations. 
  • Are there methods of ‘escalation’? Do employees and managers know who to talk with if they can’t resolve a disagreement? With luck, most conflict can be resolved ‘in the moment’, but when it can’t then it’s good to have someone who can mediate and help everyone involved to ‘hit the pause button’ until a practical solution can be found. 

Martin McTague: FSB plays an important role in supporting smaller employers to comply with their employment law obligations. For example, our communications team circulate changes to employment law through social media channels and in our newsletters. We also offer our members a 24/7 legal advice helpline, staffed by trained solicitors. 

Employment law queries make up a disproportionately large proportion of the calls into the helpline. This is an invaluable service for our members who do not have access to HR or legal support directly within their business.

Q: Why does managing conflict matter? Shouldn’t we just expect people to be grown up and sort out their own problems? 

Clare Chapman: One starting point for all organisations, whatever their size, is to think about financial cost of conflict. Acas’ cost of conflict research, published in 2021, found that conflict costs businesses an estimated £28.5 billion a year. On average this amounts to more than £1,000 per employee per year, a figure worth taking note of. Also:

  • Nearly half a million people resign each year at a cost of £11.9 billion
  • Over 300,000 people are dismissed following disciplinary action at a cost of £10.5 billion.

One way to reduce costs is to handle conflict early, and this involves, amongst other things, managers being ‘conflict competent’ – by which we mean having all the skills to tackle disagreements and misunderstandings as early as possible. This isn’t just about reducing financial costs. It’s also about reducing the emotional and stress-related costs associated with experiencing conflict at work.

Yes, people can often sort out their own problems but having a safety net – of skilled managers and good policies – is vital. 

Q: ‘What can either side do to find solutions when one side is adamant that they want their day in court?

Clare Chapman: Parties often talk to Acas about wanting their ‘day in court’. This may be because they feel they may get a better settlement in front of a judge, or because they feel it offers a stronger sense of ‘justice’. Acas’s role is to help parties fully understand what the tribunal system is about, to help them understand the strengths and weaknesses of their case, and to discuss in detail any offers on the table. It’s a voluntary process that reduces cost, stress and time involved in a tribunal, helping many to settle their case beforehand. If not, we don’t stand in their way of a tribunal hearing. But we do make parties aware that we are there to help settle, right up to the moment the hearing begins.

Small business owners may often feel being taken to a tribunal by an employee as something personal – especially when the business is one that they have built themselves, and the staff feel like family. But it’s important to take pragmatic choices for the best outcomes, and Acas can help to achieve that.

Q: We’ve a hybrid workforce where half must physically come to work for operational reasons and others can work from home - what can be done to avoid this creating conflict?

Martin McTague: Nearly all (91%) small employers are offering their staff some form of flexibility – from working location to control over hours. The main area of change since the pandemic has been an increase in home working. Over half (55 per cent) of small businesses now offer home working to some or all staff, compared to 39 per cent before the pandemic.

Regular conversations with staff are important so people know they can talk to their manager if they aren’t happy with their working environment. Prior to the pandemic our research found that the lack of hierarchical structures and reduced bureaucracy found within small businesses may often lead to greater autonomy. For example, 67% of small business employers stated their staff have flexibility over the timing and location of their work prior to the pandemic. It is important employers are encouraged to improve on this despite changes to locations of work. 

Clare Chapman: I agree with Martin about the importance of job autonomy. Equally, managers will want to avoid an ‘us and them’ scenario developing. Try to be as fair and even-handed as possible in deciding the best arrangements to suit the business and the employees. And remember that for some employees, flexible working might be the best form of ‘reasonable adjustment’ under the Equality Act.

We have heard a lot about home and remote working in recent years as the pandemic brought a mandate to move people out of the workplace. For the moment it's been something of a revolution in the way we work, but this isn’t the case in all work settings, and this applies to many of the small firms offering front line services.

Looking forward, if companies want to start bringing people back to the workplace, they may have some important decisions to be made on what’s required, and what’s desirable. They may wish to set consult employees on a plan and then begin to ‘socialise’ the way things will work in the future. 

Q: Can an employer initiate a request to Acas for conciliation? How is this done? Are there any costs?

Clare Chapman: Conciliation is available to employers both prior to an employment tribunal claim being submitted (called early conciliation) and after a claim has been lodged, all the way up until a judgment is reached. All claims to the tribunal system must first notified to Acas for early conciliation – notification is mandatory, though engaging in the conciliation process is voluntary. 

It is a free service. Acas is impartial, which means we are not on either side. We are there to see if an agreement can be reached without submitting a tribunal claim, or where a claim has been submitted, to avoid a tribunal hearing. Early conciliation takes place over the phone for up to six weeks.

Acas conciliators can talk through the issues with both sides; talk through possible options; and discuss how you may be able to solve the dispute without going to tribunal. Evidence shows that a higher proportion of cases which reach the tribunal are from small businesses. In 2020-21 we received nearly 115,000 early conciliation notifications claims and through our service, only 7% of disputes notified to Acas ever resulted in a tribunal hearing.

Q: In our business we have been trying to use mediation for early intervention rather than using formal grievance processes. We have the support of trade union colleagues, but we are finding people reluctant to try it. What more can we do to reassure and encourage a less formal approach? 

Martin McTague: Mediation is an extra potential tool to resolve workplace conflicts. It can provide an informal, although still structured, way to reduce tensions, better understand each other’s sides of a dispute, agree a jointly-held goal to get to, and then lead to an informal resolution.

It’s often quicker than the formal procedures, and it’s more flexible. But it’s also voluntary; both sides need to feel confident for it to be used. So you might want to consider finding some impartial online guidance/case studies about how mediation can work.

Crucially, anyone can withdraw from an informal mediation process; and it’s important that people know that taking part does not in any way close off a more formal grievance process. It’s an additional tool and does not replace existing mechanisms.

Clare Chapman: Some people may feel that mediation isn’t right in their situation. Overall, mediation is best suited to conflict associated with relationships and behaviours, rather than instances where an individual feels their rights have been breached in some way.

Mediation can be used at any point in handling a dispute: it is not necessarily just an alternative in advance of a grievance. It is also about knowing what mediation involves: who the mediators are (inside or outside the organisation), assuring that the mediators are trained and any information exchanged will be treated as confidential. Some anonymised illustrative examples of past mediations and outcomes can be helpful in piquing people’s interest and helping build trust in the process.

Q: How often is mediation effective when it is between an employee and their line manager? I have never seen it yet!

Clare Chapman: Estimates suggest between 60-80% of all mediations result in a positive outcome or at least progress towards success. As you would expect, Acas mediation has a higher success rate, as we are the experts – around 77% reached full or partial agreement in 2020-21. What does success look like? It’s about the parties reaching at least part, if not a full solution to the problems, and doing so in a mutually agreeable way.

Q: We have 4-6 weekly meetings with all staff, usually about 1-2 hours long - so we give managers time with their staff. How do we measure the ‘quality’ of these?

Martin McTague: Having regular meetings with staff is important to monitor their work progress, general well-being and identify any issues. The quality of meetings can be measured by their productivity and whether the key objectives of the meeting are met. For example, whether action points for staff are agreed and followed up on and whether all agenda items for the meeting are covered.

A well-organised and managed meeting will give everyone an opportunity to participate, without certain participants dominating to the detriment of others. If any participants have issues that may take longer to discuss, the manager can agree to speak with them separately, outside the staff meeting to address these issues.

Clare Chapman: You could hold a workshop with the managers to find out what works and what doesn’t. Gathering (anonymous) feedback is a good starting point. Managers should also have training about how to hold these conversations, so they have the confidence and skills to do so and know where to turn for support themselves. Two-way conversations are best done regularly and informally in the usual place of work so that it becomes natural to identify what’s working/ not working and take action. 

Q: I have Finance and HR responsibility in a small business (18 employees). Have you any tips to help resolve an HR issue where the employee and I share the same line manager?

Martin McTague: This depends on whether the HR issue is a specific complaint regarding a manager. If so, the employee should be given the choice of having a different manager investigate and respond to the HR issue they have raised where possible, rather than the manager who is the subject of the complaint. 

If this is not possible, the manager whom the complaint is against must remain as open-minded as possible in judging the facts and presenting an outcome