LinkedIn Chief Reid Hoffman is right when he says that employers and employees are not honest with each other. Specifically, Hoffman is referring to the misleading commitment between the two whereby employers offer continuing employment and build career paths for their “family” of employees and employees in return offer employer “loyalty.”
The truth is this contract hasn’t existed for years. The far majority of workers are “at will” employees that have no real job security. Similarly, an increasingly mobile workforce has learned that the best career move is to eventually find work elsewhere. Old style loyalty no longer exists. But the fact that many organizations continue the family-loyalty charade no doubt contributes to the low employee engagement scores that are estimated to cost U.S. businesses in excess of $370B each year.
What’s the answer?
In my experience with running organizations ranging from a startup to a multinational, rebuilding trust starts by establishing a new contract between employees and employers. Here are some ideas on how to get started.
First, openly acknowledge the moose on the table and engage in frank conversations about the current state of affairs. For example, LinkedIn prospective employees are informed that the company plans to have a huge impact on their career; under this light, they are asked what job they want after LinkedIn.
Second, include a broad range of participants to build a new contract that reflects today’s reality. Set clear expectations in each of three areas:
- Employees must commit to constant performance improvement, continuous learning, and to increasing their market value.
- Employers must commit to employee retention programs, market-based pay, adequate skills training, and to increase the value of each employee.
- Both must commit to the values of the organization, and to open and honest communication.
Third, each side needs to step up to new behavior to make it work. Employees must develop new self-advocacy skills as they think of themselves as market free agents. They need to be willing to build skills outside of work. And employers must do a better job listening to employee feedback, committing to more training, and beginning to manage human capital with the same rigor as they do financial capital.
Overall, the myth of life-long employment has been gone for years. It’s time we stepped up with integrity to an updated contract between employees and employers—an employee-employer contract that works.