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A good working environment and good pay is more important to employees in the UK than working for a well known brand, YouGov verifies. That may be partly why over 90% of UK employees work in small organisations. So what do you do about these factors in order to be a good employer?

Let’s start with “good pay”.

50% of people are paid twice what they are worth and 50% half what they are worth, according to Robert Townsend who transformed Avis rentacar. In truth determining the value of an employee is uncertain at best. Most employees judge their earnings on a relative rather than an absolute scale. They look to see whether they can afford to do what others in their social circle can do. Most departures are caused by “push” factors, such as poor communication, poor leadership, lack of recognition just as much as poor pay packages. “Total reward statements” can help counter false perceptions about remuneration. Exit interviews can help establish to what extent pay may be a factor in retention.

Clear policies and procedures –the Employee Handbook

From the new recruit to the redundant employee everyone wants to know where they stand with respect to their employer. That is why an Employee Handbook is a must for every business. Its tone and clarity, as well as its comprehensiveness, sets the foundation for a good working environment.

It goes beyond the contract of employment, which is an individual document setting out the legal contract between you and an employee.

Policies should cover potential areas of conflict such as equal opportunities, and bullying and harassment, as well as disciplinary procedures. Sound policies guide both parties in such situations. Employees want to be re-assured that if “things go wrong” they will be treated fairly and it will be consistent with how others are treated.

The psychological contract

Much of this is about expectations. What you expect of the employee and what they expect in return. Clear roles and responsibilities from the outset help to forge a productive relationship.

False expectations, such as can arise from job interviews, may undermine this.

Jobs can be broadly and flexibly defined in some situations or more precisely defined in a job description. The key quality to avoid is “role ambiguity”, which is a major cause of workplace stress.

There are many factors that can strengthen the psychological contract such as opportunities for training, for personal and career development, an employee voice (i.e. mechanisms for listening to employees), creating a sense of belonging (through company social activities, for example), to supporting employees through change either within the organisation or in personal circumstances.

I believe we all want to be good employers; we just need to remind ourselves what we can do to ensure we are.

Malcolm Martin FCIPD

Author Human Resource Practice