Industrial relations, also known as employment relations, refers to the relationship between an employer and its employees. The relationship affects employee morale, workforce productivity and a company's ability to maintain a steady workforce with low turnover rates.

Industrial relations may include collective bargaining and worker participation in decisions affecting the company. With the right kind of industrial relations, companies can maintain relationships with their workforce in a way that allows for the needs and concerns of both sides to be met.

Communication in the Workplace

Communication, or lack thereof, is one of the critical factors that affect industrial relations. Employees want to feel valued and respected. They don't want a strict authoritative relationship that makes the flow of communication seem one-sided. There needs to be two-way communication that allows for the opinions and ideas of employees to be heard and considered. When employees are constantly given instructions without the chance to provide their input, they may not feel valued.

Excellent communication in the workplace involves transparency from leadership about company matters and the direction the company is headed. Companies should be open and straightforward about employee expectations, so there is no room for confusion and less of a chance for conflicts to arise.

Whenever the employees' understanding of the roles they are supposed to fill doesn't align with management's expectations, disputes can occur and create bad relations. Having a clear understanding decreases the chance for conflict between employees and provides a sense of direction.

Salary and Benefits

One of the best ways to keep employees happy and maintain good industrial relations is to pay them a respectable wage that is, at minimum, up to industry standards. Going beyond minimum standards to pay better salaries tends to keep employees around and decrease turnover rates.

It has become increasingly important for businesses to provide their employees with more than a decent wage. Today, they also need to provide substantial benefits. Outside of health care benefits, such as medical and dental coverage, companies that provide their employees with generous paid time off and resources for professional growth usually experience better relations with their workforce.

Companies that understand employees have a life outside their job duties and that provide benefits that showcase this understanding often enjoy great employee relations.

Role of Unions

Unions give workers an amplified voice to make their thoughts and concerns heard. This increases the chances that they will achieve increased pay, access to health insurance and better working conditions. Instead of employees arguing on behalf of these issues by themselves, a third-party handles the grievance process and labor disputes.

Having a union to handle concerns gives employees a valuable resource and can translate to a sense of empowerment. Employee relations are generally better when employees know there is a union in place to handle large-scale issues that may go unaddressed without a union.

Role of Company Culture

A business's company culture influences and sets the tone for how it operates. The culture is typically set by the company's leadership and relayed to employees not only vocally but also by day-to-day actions.

A company that empowers employees and embraces their value to the organization will have good employer-employee relations. On the other hand, a company culture that embraces punishment over teaching can evoke feelings of fear and uneasiness among employees, which damages relations.