Can we afford conflict in the workplace?

Adrian Wakeling explains why businesses need to do more to deal with disagreements, including training line managers and involving the board

I’d like to start with a provocation: we can’t have fair, inclusive workplaces without some conflict.

Why we need conflict

Yes, it seems the ultimate workplace paradox, but within the statement is more than a grain of truth. Many individuals and groups have to struggle to be heard and promote fairness at work in various forms, whether it’s relating to racial or gender equality or fighting stigma around mental health. And the pandemic has increased many pre-existing inequalities in society and at work, notably for women, carers, older employees and black and ethnic minority staff.

If channelled in the right way, many forms of conflict can help to transform and modernise workplace values and mindsets. Ideally this is done via effective mechanisms for employee voice. But even if we agree that some degree of conflict is necessary, and even healthy, can we afford it?

New Acas analysisEstimating the cost of conflict at work – of the cost of conflict may not seem the cheeriest report to read right now. As we struggle to emerge from a worldwide pandemic, and manage the impact of Brexit and an economic recession, do we really need to be told that conflict costs the UK £28.5bn a year, at an average cost of £1,000 per employee?

It’s a landmark piece of work, carried out by Richard Saundry and Peter Urwin, and based upon useful survey data from the CIPD. For the first time, we have broken down the cost of conflict from minor disagreements between colleagues, right through to legal procedures. The report matters because it gives us a chance to reflect on why conflict matters and how we can manage it better, as well as how we can let it inform and challenge us. 

The cost of conflict

Let’s be honest, no one really enjoys conflict. It has a massive impact on our wellbeing – the CIPD data shows that 56 per cent of people experiencing conflict suffer stress, anxiety and/or depression as a result. The real trick is to be able to distinguish between good and bad conflict. 

As the report makes clear, there is a lot of avoidable conflict. Some of the findings are startling:

  • 900,000 took time off work, nearly half a million resigned and more than 300,000 were dismissed because of conflict.
  • The cost of recruiting replacement employees each year is £2.6bn and the cost of lost output as new employees get up to speed is £12.2bn, amounting to £14.9bn each year.
  • 874,000 employees are estimated to take sickness absence each year as a result of conflict, at an estimated cost to their organisations of £2.2bn.
  • Presenteeism has a negative impact on productivity, with an annual cost estimated between £0.59bn and £2.3bn.

What we need to do about conflict

These estimates put the pound sign behind what is going on in modern workplaces – but thanks to almost a decade of ongoing research, we know the human stories behind the findings and, crucially, what needs to be done.

First, and this will come as no surprise, there is work to be done to help line managers. As the report says: “Conflict competence is an essential ingredient in good management, and it has a positive impact on organisational effectiveness and performance.” The cost of informal interventions to resolve conflict – often simply having a quiet word – are reasonably inexpensive. Which begs the question, why don’t we do more of this stuff? Managers need training but also reassurance that they are not being cast adrift to deal with everything on their own.

Second, conflict must be taken more seriously, ideally at board level. It can provide a good barometer of the issues that are emerging in the workforce. And, third, let’s not run down conflict too much. Employment rights are there for a reason and being able to seek redress is a critical part of natural justice. Having said that, a lot of problems can be solved by listening and involving employees in what’s going on at work.

Can we afford conflict at work? The answer is yes and no. We can and must afford the kind of conflict that gives us a wake-up call and helps us achieve greater equality and fairness but, no, we cannot afford the wasted talent, the sick employees or the loss of productivity.

Adrian Wakeling is senior policy adviser at Acas