LITERATURE REVIEW

The term employee relations are actually a company's efforts to maintain smooth
relationships between employers and employees. Employee relation management is
typically part of a HR strategy planned to make sure the most effective and efficient use
of employee is done in order to accomplish the organization's mission. It is basically
organization’s effort to encourage and maintain an optimistic relationship with its
employees. By sustaining positive and constructive employee relations, organizations
hope to keep employees faithful and more engaged in their work. Mostly, an
organization’s human resources department manages employee relations efforts, however
few organizations may have a dedicated employee relations manager role known as
Relationship manager. The responsibilities of an employee relations manager include
acting as a link or intermediary between employees and managers, and sometimes
making or guiding on the creation and implementation of policies for mostly employee
issues as it is their focused area, like fair compensation, useful benefits, proper work-life
balance, flexible working hours, and others. To maintain positive and constant employee
relations, an organization at first must consider employees as their asset and main
contributors in the organization instead of considering them just a paid labor, as this way
the organization is not focusing on the employee relation and it may result in insufficient
performance.

Effects of Employee relation on organization

Employee relations can make or break your business. They can become the strength of a
business if treated well. Happy employees are more productive and put more effort into
their work. They do their best to meet your expectations and never want to disappoint or
ditch the organization in any way. Basically, a faithful and productive employee help the
company grow, which at the generates more revenue and satisfied customers. Evidence
shows that improving your employee relations should result in higher retention rates and
reduced turnover, so it's definitely worth the effort.

1
2
A number of benefits can be accrued from employee retention. GC (Ghana Commercial)
bank in Africa conducted a research in year 2017in which they were able to know that
good employee relation effected their organization in many positive ways. Below is the
figure:

Source: Field data,2017

Advantage of positive employee relation:
Happy employees are 12 percent more productive and get better results than their peers.
That's why Facebook, Microsoft, Google and other industries invest heavily in employee
satisfaction. As a great employee relation help the organization to grow more and it effect
the organization in best ways. It's pretty well documented that Google has a unique
culture. It’s not the typical corporate culture. First, let’s look at the perks of being a
Google employee: Free breakfast, lunch, and dinner. The organic food is chef-
prepared, Free health and dental, Free haircuts, Free dry cleaning and any more. This
culture has paid off for Google, as they consistently rank among the best places to
work.

The employee has the great impact on the growth and performance of the organization as
they are the main asset through which any organization can lead or decline. Due to the
importance assigned to these relations, some leading organizations in the world have
attempted to define the term from their perspective. Nasa, the US space agency, defines it
as: “Employee relations involves the body of work concerned with maintaining
employer-employee relationships that contribute to satisfactory productivity, motivation,
and morale. Essentially, employee relations are concerned with preventing and resolving
problems involving individuals which arise out of or affect work situations”.
(Dawn,Parveez Rahim). Motivated workers are faithful to their employers and worry
more about their actions and the services they provide. They're also more eager and
enthusiastic to learn and grow professionally, show a constant commitment to efficiency
and obtain better results. It's their smart and hard work that builds business growth and
provide it everlasting success.

3
Disadvantage of negative Employee relation:
A poor work-life balance, lack of job security, conflicting work roles and heavy workload
are all common causes of job stress. Employees who are facing these issues get sick more
often, perform more poorly and feel less motivated. In fact, stress is responsible for 60
percent to 80 percent of accidents on the job. According to Eastern Kentucky University,
American companies lose $150 billion annually because of employees who are not
functioning optimally (Parachi Juenja). In case your employees are worried about their
financial situation, they won't be able to do their job effectively. They might spend
their work time thinking about bills and reviewing financial statements. They'll also
feel less motivated to accomplish their tasks and meet your expectations and this all
effects the organization performance directly and thus the business may not grow
properly.

There are many more important factors that affect work performance. It includes
Employee motivation, organizational culture, leadership and rewards and these are
few examples. To see the effect of employee relation on the organization, one should
conduct surveys to find out what their employees' value most and what can be
improved. Keep an open mind and experiment with different strategies as the
employee relation with organization effects the overall performance.

4
5