Problems with Employee Trust and Some Solutions

By | Small Business

A slowly recovering economy and wage stagnation have contributed to a level of workplace mistrust, according to several authors, studies and employment experts.

One recent survey found:

  • 53% of employees don’t feel recognized for their achievements at work.
  • 51% are not happy with their jobs.
  • 61% don’t know their company’s mission or cultural values.
  • 45% don’t trust their company’s leadership.
  • 50% don’t expect to be in their current jobs next year.


These painful findings come courtesy of the employee  recognition and rewards firm, Achievers, and its 2015 workforce report, “The Greatness Gap: The State of Employee Disengagement.” That survey of nearly 400 North American employees, found widespread mistrust between employees and their companies.

Start With Communication

David Brennan, general manager of the employee recognition firm Achievers, was not surprised “But I think many employers would be. Many have a real hard time communicating with their employees,” Brennan said. “That’s the underpinning of the problem and it impacts the level of trust. When leaders aren’t effectively communicating with their employees, it creates gaps. Employees begin thinking things that may or may not be true. They feel kept in the dark and become more cynical. If you’re only sitting down on an annual basis with your staff, too much time can pass by and those employees can get sidetracked. These findings should shock CEOs and business owners.”

Brennan said Achievers, which employs 230 in San Francisco and Toronto, holds quarterly town meetings that review goals and achievements of the past quarter and department reviews.

“We started those things when we were small and built on this foundation of good communication until it became part of our culture. We don’t do annual performance reviews. People are recognized on a daily basis. We employ a recognition newsfeed that gives employees real time feedback. They don’t have to wait a year. They can see how they are trending on a daily or monthly basis.”

He said that even managers in small companies need to make time to recognize their employees’ contributions.

“There’s no greater ROI than to say thank you,” he said.  “At the end of day we all go home and get same question: How was your day today?”

Lack of Trust

David Ballard, who heads the American Psychological Association’s Center for Organizational Excellence, said the recession and its subsequent layoffs, pay rollbacks and benefit cuts left employees feeling uncertain and concerned.

Ballard said the annual APA workforce survey found that one in three employees reported that their employers were dishonest with them.

“This lack of trust should serve as a wake-up call for employers,” said Ballard, who noted that trust affects employees’ sense of well-being and job performance.

“Fewer people are being asked to do more work with fewer resources,” he said, citing the APA survey conducted by Harris Polls.

Ballard said research shows that past employer-employee interactions affect employee trust.

“The perception of how fair things are done weighs heavily,” he said.  He said reliability is another factor. “How predictable are the interactions with employers? Can employees expect to be treated fairly and consistently? Or do those interactions feel random and chaotic? Many employees surveyed said they were waiting for the other shoe to drop.”

Ballard said satisfied employees reported higher levels of job involvement and felt recognized for their contributions.

“If you give employees more autonomy and control, greater say in day-to-day operations and input in decisions that affect them on the job and then recognize their work through monetary and non-monetary rewards, employees perceive they are valued,” he said. “There’s a huge difference in job satisfaction, motivation and intent to leave the job between employees who do and don’t trust their employers.”

He said small employers can’t always offer robust benefits or match high wages and salaries of large corporations. “But they can be more nimble and find more unique and personalized ways to recognize employees and many of the most effective are low cost or no cost,” he said. He said insuring that employees have a good job fit is important, starting with hiring right the first time. 

“Employees who say their jobs fit them report higher levels of job satisfaction and performance and lower turnover,” he said.

Quitting at an all time high

Paul McDonald, senior executive director of the Menlo Park, Calif.-based professional staffing and executive recruitment firm, Robert Half, said the ‘quits’ rate—the movement of employees from one organization to another— is now approaching an all-time high.

“That movement indicates a level of distrust. If people have gone through this economic downturn with the same organization and haven’t seen their compensation levels return to previous levels, they believe that their employers are not taking care of them, even after they stuck around through the hard times.”

McDonald, who has been tracking employment trends for more than 30 years, said management must be consistent in how it handles employee rewards, recognition and reprimands.

“If they’re inconsistent in their processes for handling problems, compensation, promotions and demotions, that builds huge mistrust and creates a culture that undermines organizational morale and spurs gossip at the water cooler or, worse yet, on the electronic water cooler.”

He also recommended that management assess employee compensation quarterly instead of annually.  “The market is changing rapidly,” he pointed out. “That doesn’t mean you raise compensation quarterly, but you should understand and track the market and consult third party resources to help you. The replacement cost for top performers far exceeds what a small raise might do for that individual.”

Richard Finnegan, CEO of Longwood, Fla.-based employee engagement and retention firm, C-Suite Analytics, said research reveals that the number one reason people leave their jobs is that they don’t trust their immediate supervisor.  “All these employee surveys and programs are nice, but they don’t build one-on-one trust,” he said.

Finnegan advised employers of all sizes to regularly conduct what he calls ‘stay interviews”— scheduled one-on-one meetings between managers and employees that include structured conversations about how that manager can make that employee’s job better.

“They should happen at least once a year, but they can be more frequent and they must be separate from performance meetings,” said Finnegan, the author of “Rethinking Retention in Good Times and Bad” and “The Power of Stay Interviews for Engagement and Retention.”  “The primary purpose is to build trust with the boss.”

He suggested asking five questions of employees: what do they look forward to when they commute to work; what they are learning there and why do they stay. When was the last time the employee thought about leaving and what prompted that thought and how can the manager or small business owner make that firm a better place to work.  

It’s Not Just Compensation

Finnegan said the number one employee request in those interviews is better work processes, such as eliminating an unnecessary and time-consuming report or fixing or replacing poorly operating equipment.

“Some people will bring up compensation, but not as many as you think,” Finnegan said.  “It’s good to know why they (employees) think they deserve a raise and what skills they’re willing to learn to earn more.”

Barry Schwartz, a psychology professor at Swarthmore College and the author of “Why We Work,” said workplace studies and surveys indicate most people want work that challenges and fulfills them, gives them opportunities to learn and grow and the ability to exercise some autonomy and control over their work lives. He said companies that valued employees were more likely to survive and remain profitable.

Schwartz said mistrust stems from several factors, but one has longstanding duration: the lack of employment security.  “This notion that the last thing your boss would do is fire you is gone and in its wake it’s produced a lack of loyalty from employees,” Schwartz observed.

He said some business owners hire with the view that they must constantly watch what employees do and bribe them into working hard.

“People like to get bonuses, but sometimes they come with the implication that you can’t be trusted to work without being compensated extra,” he said. He advised granting employees greater responsibility.

“Don’t just make speeches, then keep things the way they were. Act on complaints and suggestions. Nurture them along. You have to show them you’re sincere, which may mean tolerating a few mistakes. Over time, you can change the culture and in the long run the company will be a more profitable business and they will do better work for you.”

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