Do employers have responsibilities to employees beyond the explicit terms and conditions of employment and whatever statutory or regulatory requirements might exist?
And, if there is an implicit unstated agreement between employees and employers, how can leaders ensure that they uphold their side of the agreement whose details may not be fully understood by the parties?
On this week’s episode Mike and special guest Julie Develin discuss the psychological contract, which Julie describes as “the exchange relationship between the organizations and their people.”
During this thirty-minute episode, the speakers clarify what the psychological contract is and how it has changed since the start of the pandemic. What happens when employees and leaders aren’t on the same page with regards to the psychological contract? What can an employer do to clarify or strengthen the psychological contract?
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Julie Develin
An expert on employee relations, workplace flexibility, and workforce development, Julie Develin is a Sr. Partner, HCM Advisory at UKG, a global leader in workforce cloud solutions. With more than 17 years of experience as an HR executive focused on improving workplace culture and enhancing the employee experience, Develin helps organizations worldwide implement strategic employee technology and workplace initiatives to enhance productivity, improve communication, and increase satisfaction across the workforce. Develin holds an M.S. in human resources development from McDaniel College, where she continues to work today as an adjunct professor in the human resources management and human services management programs.
Transcript
Julie Develin: I’d venture to say that trust in its many forms is really the foundation for everything else at work and it can make or break the success of individuals and the company. I think a healthy workplace and a positive employee experience really depend on a trusting environment and that trusting environment breeds psychological safety.
A psychologically safe environment is one where folks feel like they can come and share ideas, and they’re not going to get shot down. They feel like they can air complaints or grievances perhaps and they’re not going to get fired.
[intro music]
Mike Coffey: Good morning, HR.
I’m Mike Coffey and this is the podcast where I talk to business leaders about bringing people together to create value for shareholders, customers, and the community.
Please follow, rate and review Good Morning HR on Apple Podcast, Stitcher, Spotify, or wherever you get your podcasts. You can also find us on Facebook or at goodmorninghr.com.
Do employers have responsibilities to employees beyond the explicit terms and conditions of employment and whatever regulatory or statutory requirements there may be? And if there is some implicit or unstated agreement between employees and employers, how can leaders ensure that they uphold their side of the agreement whose details may be not fully understood by all the parties?
My guest today is Julie Develin. Julie’s a senior partner at UKG’s Human Capital Management Advisory, a regular blogger on topics regarding the intersection of people and technology in the workplace and host along with Chas Fields of the People Purpose Podcast. Thanks for joining us today, Julie.
Julie Develin: Thank you so much for being here, Mike, I’m super excited to be here and always love to support other podcasts as well. So good morning to you and let’s do this thing.
Mike Coffey: Thanks. So last fall in a blog on the Kronos website, you described the psychological contract as the exchange relationship between the organization and their people. So that’s more than just the obvious transaction of the employee comes to work, and the employer pays them? Does that work?
Julie Develin: Oh yeah. Oh yeah. Yeah. It’s way more than that. At its simplest form, the psychological contract is that exchange relationship when it comes to pay. All of us, we wouldn’t be working if we didn’t get a paycheck, that’s a given. But really what we’re talking about with the psychological contract is much deeper.
We’re talking about mutual expectations between employees and employers from many, many, many different angles. So it concerns a lot of fairness, it concerns a lot of balance, it concerns a lot of what promises are being made on both sides and are those promises being upheld? So not just about money, of course it’s about money, but it’s also about things like flexible work environments, it’s about things like benefits, it’s about things like providing a good manager for employees. So it goes much, much deeper than that.
Mike Coffey: But are a lot of these terms of the psychological contract unstated or are they just things that employees or employers assume the other party knows?
Julie Develin: Yeah, these are unstated. So the thing about the psychological contract and what makes it so sort of challenging maybe for HR professionals and also for managers and anybody in the business of people is that it’s unwritten.
So it’s not something you can look at, it’s not something you can see and say, “Oh, these are the terms of the agreement that we’ve set out.” Nope, it’s dynamic, you can’t see it, you have to constantly recognize that it’s unstable and it’s changing. And it changes based upon different circumstances.
So let’s say for example, a global pandemic, before the pandemic, there were certain expectations that maybe employers had of their employees that maybe now those expectations are a little bit different and vice versa. And really it’s unique to each person as well. So it’s just this imprecise and implicit and unstable and dynamic relationship that employees have with employers and employers have with employees.
Now, it doesn’t necessarily mean that’s a negative thing, right? I mean, it’s a matter of making sure, as employers and human resources professionals, that we are not over promising things to folks and making sure that we are being truthful with them and transparent with them so that way they don’t feel that lack of trust. Really that’s what it boils down to.
Mike Coffey: So if I’m an employer and I’m trying to figure this out, am I looking at employee engagement scores, production numbers, things like that to see if we’re getting what we need out of the organization and out of our workforce as an organization and things like retention? I mean, how do I know if I’m living up to that contract or not?
Julie Develin: Yeah. Well, this is where analytics and data management and HCM systems and the kind of data that you collect become really, really important because we need to make sure that we’re keeping a pulse on what’s going on with our organization.
A lot of times employers think that they know the expectations of their employees, but my question I would challenge to those who say, “Oh yeah, I know what my employees want,” I would challenge you and I would say, “How do you know that? Do you know that because that’s what you think? Do you know that because that’s what someone told you?” But look at the collective.
If you look at the collective employee group, to know each individual’s expectations, it’s very difficult to do because, again, those expectations are dynamic and they change.
But yes, looking at things like retention data, looking at retention by manager is very important as well, doing things like exit interviews and looking at the reasons that folks may be leaving. You can also look at productivity and let’s say you have metrics that show that your workforce’s productivity was really, really high for a certain period of time and then you’ve seen that steady decline.
You need to ask yourself, why is that decline happening? Is it happening because of circumstances that you, as the employer, have put into place? Is it societal circumstances? Is it time of year? I mean, there’s lots and lots of different things that you can look at, but the fact of the matter is it’s important that employers actually do look at that information and have some sort of regular cadence with reporting.
Mike Coffey: You mentioned exit interviews, I am and for a long time have been a big advocate of stay interviews, sitting employees down and saying, “Why the hell do you still get up and come to work every morning?” And I assume that would be a really good data source to find out what engages your best employees, what gets them there and why they see meaning and what they do.
Julie Develin: Yeah. I’m a big fan of stay interviews as well. So my background in HR of 17 years as a VP, if there’s one thing… Well, there’s several things as you look back you say, “Oh, I wish I would have done that different. I wish I would have done that better,” hindsight of course, 2020.
But I wish I would’ve had more of a stay interview program or something where I would say to managers, “Look, you need to do one of these for XYZ tenured employees every certain amount of months,” right? Because that information that you can gain from the folks who have been at your organization for a longer period of time is so incredibly valuable.
I call feedback the currency of HR. I think that HR can use feedback that you get from employees in so many meaningful ways that we probably don’t always take advantage of. And that’s not to say that it’s our fault, we’re busy people, right? I mean, HR, you have to get through the day, that’s what we’re trying to do.
And oftentimes it’s hard to have that future focus, but having that future focus, I think, is something that we as a profession really need to look at and we need to train our eyes towards the future more, understanding that the present is important. So, yeah, that’s what I would say. It’s a lot to think about.
Mike Coffey: You mentioned how the pandemic has changed it some. Can you dive a little deeper into what you’ve seen in that psychological contract between employers and employees over the last 18 months and how that’s morphed?
Julie Develin: Yeah. Some of them goals that were set for folks prior to the pandemic, those goals may have changed. I’m talking about performance management goals. An if you have employers who aren’t taking a look at those things and recognizing that our world has changed, our world in every way it really has, things that people value, people’s time, I mean, there’s so many different dynamics that have come into play. And the pandemic has really opened the eyes of a lot of people as to what is and is not important to them.
And what I’ve seen is that a lot of companies at the beginning of the pandemic were much more empathetic and sympathetic to employee situations, but as time has gone on, it’s sort of like, “Okay, well we’re all in this together so just get to work and do your job,” and have I seen that? “Yeah, sorry about the global pandemic, just work.” I mean, I say that in jest. But it’s something that I don’t see at every organization, but the successful organizations will keep changing with their employees and recognize that this is a dynamic and unstable situation, just like the psychological contract.
The pandemic that we’re all in is dynamic and unstable. Now, the other thing that we really need to remember when it comes to the pandemic is that all of us are in the same boat, but we’re not in the same kind of boat, right? Some of us are in a yacht, some of us might be in a speed boat, some of us might be in a dinghy and then some of us might be in the water holding onto a piece of wood just to stay afloat.
Mike Coffey: There have been times where I felt like I was on the SS Minnow
Julie Develin: Yeah, I used that line of speech, I used that in a speech a couple of weeks ago and the lady said, “I think we are on the Titanic.” It’s like, oh gosh, that’s not good, iceberg straight ahead.
But I think just employers need to recognize that this concept of empathetic leadership is something that employees are going to continue to expect moving forward. And if they were given that at the beginning of the pandemic and they are now sort of not given that flexibility anymore, or maybe the benefit of the doubt anymore, they’re going to say, “Well, why did you do that then but how come you’re not doing that now?” We’re still in the pandemic.
And again, it’s like with the pandemic, you had a period of time where things seem to be sort of getting more stable dare I say and then all of a sudden you have the Delta variant that has completely just thrown a wrench into everything. So there were a lot of employers who said, “Hey, yeah we want you all to come back to the office by Labor Day.”
Well, that was part of the expectation that employers had, but see circumstances have now changed, people may not feel as safe anymore. So again, it’s these things that employers need to make sure that we’re taking a look at to understand what it is that’s on top of mind of our employees.
Mike Coffey: And let’s take a quick break.
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And now back to my conversation with Julie Develin.
Mike Coffey: So you mentioned safety, feeling safe at work and physically safe and in a healthy environment, all the basic kosher standard duty kind of things. And what about psychological safety?
We hear a lot about that. And I think a lot of managers, especially I hate the term manager when you’re talking about people, I prefer leaders, but most of the people who are in management roles aren’t leaders so we’re not there yet, but I think a lot of managers hear that term, psychological safety, and they either started thinking, “Okay, I’ve got to start catering to all the snowflakes,” or they think that, “I don’t have that background, I don’t know how to give somebody, either they thrive or they don’t and I’ll find somebody else who will thrive if they don’t.” So talk about psychological safety in maybe a way that managers can understand that.
Julie Develin: Okay. Note to self, don’t use manager anymore on the podcast, use leader. Okay.
Mike Coffey: Well, if we’re talking about leaders.
Julie Develin: No, but what you just said actually makes a lot of sense and not in a good way, right? Most managers are not leaders. Yeah, no, you’re absolutely right. I think when we’re talking about psychological safety, that is a definite part of the psychological contract.
We need to make sure that as organizations, that everyone’s on the same page, and they’re clear about what the definition of trust is at their organization. So trust may mean something different to everyone, to each organization. And it may mean something different to each manager or each leader, sorry, or maybe not leader depending.
But I’d venture to say that trust in its many forms is really the foundation for everything else at work and it can make or break the success of individuals and the company, I think a healthy workplace and a positive employee experience really depend on a trusting environment, and that trusting environment breeds psychological safety.
A psychologically safe environment is one where folks feel like they can come and share ideas and they’re not going to get shot down, they feel like they can air complaints or grievances perhaps and they’re not going to get fired, right? So as organizations, and as people leaders, we need to make sure that we’re allowing folks that space to do that.
And I hear so often from individuals who say, “Oh yeah, well, this is what I thought, but I just didn’t think that I could tell anybody,” my question is, well, why? Why couldn’t you go and tell somebody? There’s so many different layers to that when it comes to psychological safety.
But another thing is the fact that there are a lot of people managers who don’t verbally communicate anymore, they’ll do all of their communication via electronics, via text messages. I remember when I was a practitioners I used to have managers come to me and say, “Oh so-and-so and I are having an argument.” I said, “Oh, well, when’s the last time you actually spoke?” “Oh, we haven’t spoken, we’ve just been texting.” And I’m just like, “Oh my gosh. Okay. So basically what you’re saying is that you’re having a text argument?”
So when it comes to text messages, I guess it goes without saying, you as the receiver of that message, you’re going to take that information and it’s going to be processed in your mind however you process, it may not be as the other person intended it so that causes a lot of problems.
So again, a psychologically safe environment also has to do with things like safety, physical safety, for sure, making sure that you’re following all local regulations, that if folks ask for tools to keep them safe, be that tech tools, be it physical tools, we need to make sure that we’re listening to them and providing them what they need in order to feel safe, otherwise they’re going to find a job somewhere else.
Mike Coffey: That’s it, it really goes beyond just the ADA kind of considerations. I mean, really, I think you’re talking about, I as a leader may think that’s really not something that is really going to help this person, if they had a proper perspective about the risk of getting COVID at their age and their health thing and all that, I’ve had that conversation with a lot of our clients and some of these people are just nervous nellies and they’re going to worry about everything.
And I’m like, “What’s it going to cost you to do this, to have extra sanitizer or just space people or to let the occasional employee stagger their work time so they’re doing some hybrid thing?”
The bottom line is, you need productivity out of these employees and so what it takes to get that productivity in a way that is healthy for the organization and healthy for the employee, if that’s what it takes is why not just do it. But I think a lot of times we have managers whose perspective is, how do I maximize the lowest cost per employee and the most efficiency I can get is having everybody put tab A and slot A the same way all day long.
Julie Develin: Right. And again, not everybody fits into those boxes that we wish that they would fit into, and especially now considering that all of our circumstances have changed in so many different ways.
Mike Coffey: So UKG is a technology company. So talk about how technology can help or maybe even hinder the effectiveness of how we execute the psychological contract.
Julie Develin: Yeah. Well, it sort of goes without saying that tech can help with the communication piece, it can help with connection, it can help with belonging. Tech provides us a hub to feel like we’re part of a team when we’re remote, right? So there’s a certain place that you can go.
I know that when I go to work, I work remotely, I travel a lot, but I work remotely and when I go to work, I log onto our company system and that’s where I feel connected to my coworkers, where I can have conversations, where I can have video calls.
Tech, again, also what we were talking about earlier gives us insight into the sentiments and into what’s going on in our organizations. So many of us have dispersed workforces in HR and I was in a dispersed workforce, it’s very difficult to understand the sentiments and the feelings of all of your employees. There’s AI tools now that you can utilize and they can look at keywords and it can sort of spit out a report and say, “Okay, these are the keywords that we’re seeing in the tech system right now.” I mean, there’s so many different ways.
I think that we need to get creative with our tech as well in terms of utilizing it to foster that sense of comradery that we’ve lost. A lot of us feel like we’ve lost some of that. It goes beyond having that foosball table in the break room, right? That’s no longer how it is, now it’s, okay, do you have great video software so you can easily connect with people? Do you have a reliable platform that you can use, or do you trust the data that’s in your platform? I mean, so many different ways.
But I just think that technology can help us to ensure that we have the tools that we need in order to do our jobs effectively, and it can help us to ensure that employees have the tools they need. Now, it’s important also to make sure that we’re keeping a pulse on whether or not those tools are still serving people in the way that we intend them to. I think that having a check-in with employees every once in a while, perhaps surveying different departments, “Hey, how was your technology?”
Looking at technology usage, seeing what systems are being used, what systems are not being used. If we’re asking folks to do a job for us, if they’re spending time away from their family, if they’re putting in the work for our organization, we want to make sure that we’re taking care of them and that’s definitely part of the psychological contract.
Mike Coffey: What about times where technology has been poorly used? A lot of us went remote last March and stumbled around, “You’re still on mute,” with Zoom and all of those kinds of things for a while, but what are the risks of using technology the wrong way? What are some ways that you’ve seen companies kind of stumble there?
Julie Develin: Well, some ways that you can use technology the wrong way and what I’ve seen companies do is where it’s piecemealed. So here’s what I mean by that. So you may have dozens of different departments and each one of those departments, they have several different leaders or managers who manage people and you have a performance management plan, and they’re supposed to do performance reviews at a certain cadence. And what you may have is you may have only some managers doing that. You may have some managers who don’t do that.
So you have employees who are talking to each other and saying, “Oh, well yeah, I just got my performance review.” And then you have another employee saying, “Oh, I haven’t had a performance review in two years,” right? So making sure, I think that’s a definite way that tech can hurt because employees have that fear of missing out if they are not getting the same experience that their coworkers are getting.
Mike Coffey: So we need to keep all our employees in silos where they’re not allowed to talk to each other, is that…?
Julie Develin: Well, no, no, no, no. Well, no, but I think that we need to make sure that being consistent in the application of our policies and procedures so that way everybody’s getting an experience that they deserve. That’s what I would say. And by doing that, we’re upholding that psychological contract of what employees expect from their employer, especially in a modern environment. But tech-
Mike Coffey: I think what you’re saying is… Oh, go ahead.
Julie Develin: No, no, you go.
Mike Coffey: What you’re saying is something I said earlier, or I said in a previous blog post, was that if you had a good organization with real leaders and good people management processes, going hybrid really wasn’t going to make a big difference or even going fully remote because you understood what incentivized your folks, you understood what they needed to be successful, you had a process already in place where you were checking in with people and making sure that all the things that needed to happen for them to be successful and all the tools they had were right there.
It’s the organizations that manage by walking around, or, “What are you working on right now?” Or live by status reports. And this was it was, where you are in your progress, which is really key, but not touching back with what do you need to be successful in putting it all on the employee? When they managed hands-on all the time, those are the ones who in my experience with the last 18 months had the most problem going remote.
So it doesn’t really matter, I think what you’re saying, is technology is technology. And either we use it to help people be successful, but it goes back to the leadership styles and how people feel about the work that they are actually doing that really makes a difference.
Julie Develin: Yeah, this was a bad time for micromanagers, those folks who always were looking over someone’s shoulder or constantly wanting to know where people were. I’ve heard horror stories from folks that I’ve come in contact with where at the beginning of the pandemic where this remote work was new, that they would have managers who would ask them to be on camera the entire day.
Mike Coffey: Oh, wow.
Julie Develin: I’m thinking to myself, why, what do you want? You want to see me sitting here at my computer typing away? I mean, that’s micromanagement to an extreme. And what it’s saying, and it sort of goes back to what I was speaking of earlier, it’s that trust factor.
If we hire someone and we continue to employ them, we need to recognize that means that we’re telling them that we trust them to do a job, right? So why are we not trusting them to do the job then? That becomes the question. There should be no need for micromanagement in this day and age in my opinion.
Mike Coffey: No. UKG has got a variety of products for organizations of all sizes. For the small to medium sized organization that’s maybe using what was UltiPro, I’m not sure what you call it now, but I’ve got clients on it and they love it, but who may not have that level of data and technology, if they wanted to get in to say, okay, we’re using a chat function for our daily interactions with one another because a lot of us are remote, what AI tools would you point somebody to?
What kind of things would be initial? If I wanted to get into some of that and kind of take the pulse of the organization in a new way, where would you have us start?
Julie Develin: Survey tools for sure. Making sure that we’re not being reactive when it comes to surveys, but we’re being proactive. So what I mean by that is oftentimes folks will deliver a survey to their employees, but it’ll be too late. So they’ll deliver that survey because they already see a problem. So the idea is to try to get in touch with what’s going on before that problem happens. It’s almost like maintenance, right? Continually.
So I would definitely say survey tools. And then again those survey tools, when it comes to AI, the software, UKG software, other software, there’s lots of software out there that can take those responses and again look at the sentiments and look at what’s going on and spit it out and say, “Okay here are the keywords. Here are the amount of negative keywords. Here are the amount of positives. Here’s how many times so-and-so’s name was mentioned, or that kind of thing,” and in a positive way or a negative way.
So I think a lot of times when it comes to AI and HR, a lot of times we think that it has to be an all or nothing approach. I think that we need to just take steps to make sure that that is the direction we’re moving towards in the future, because it is the future. The future is now. So with the AI tools, with the reporting tools, so many companies I come in contact with are still using manual processes. And I get it because I was once there, I get it.
And a lot of times what we want to do in HR is stick with what makes us comfortable. But we need to recognize that while that may be comfortable for us, it’s not moving the business forward and we need to make sure that we’re looking at ways that we can move the business forward by staying on top of innovation, staying on top of technology and making sure that we’re providing that experience to employees that they’re expecting.
Mike Coffey: Yeah. I think you’re talking about the surveys about sometimes we’re just trying to figure out, is this a dark gray elephant in the room, or a light gray elephant in the room?
There’s already an elephant in the room and we already know probably what we should do about it, but we’re asking to show were concerned or that we’re empathetic to our employees’ problems, “Hey, we’re going to send a survey out about this,” but I think it makes leaders look really naive and clueless when they ask about what they probably already have a pretty good sense of. But if you don’t have ongoing major issues and you want to do surveys just to take the pulse of an organization, how often would you do that? How much is too much?
Julie Develin: Yeah, well, too much would be monthly maybe, I would say quarterly would be really good, maybe quarterly and then you have one towards the end of the year that’s more robust perhaps. But here’s the thing about the survey is we can put surveys out there, but if we don’t do something with the feedback that we receive, then employees aren’t going to trust us with their thoughts moving forward. So we have to make sure that the information that we receive, we’re taking action.
I think a lot of times in HR, we spend a lot of time thinking and sort of hoping and saying, “Oh, this should change, but we don’t spend a lot of time doing.: So actually doing is important and taking that feedback, that currency of HR that I call it, and using that for process improvement and to improve the employee experience and thus upholding the employer’s end of that psychological contract.
Mike Coffey: And I think a lot of employers, the easy part is sending the survey out but most HR folks I know right now are, as far as their workload, they’re drinking from a fire hose. And it’s a world different than it was 12 months ago.
And so maybe if you don’t have the bandwidth to address new projects, you should make sure you’re focusing on questions that you can respond to the answers to right now, rather than just something global and you set an expectation by asking the question and it’s something really large and a giant project, maybe that’s a 2022, 2023 project, and maybe we should hold off and we should focus on things we can control right now.
Julie Develin: Yeah, yeah, perhaps. Again, I think that’s unique to each organization where you are. I think you have to just really make sure that you’re understanding where you are as an organization and what you want the future to look like. I think if there’s something that we’ve all learned during the pandemic, it’s that none of us have any idea what’s going to happen in the future.
If somebody asked you five years ago, “Where would you be five years from now?” I don’t think any of us would have said we’re going to be in the middle of a global pandemic.
Mike Coffey: I was supposed to be on a beach someplace by now.
Julie Develin: Yeah. Yeah. It’s been quite a whirlwind, but, hey, that’s job security for us in HR, right?
Mike Coffey: There you go, yeah. One last question about technology and people, Zoom meetings: camera’s on or camera’s off?
Julie Develin: Oh gosh, why in HR I want to say, “Oh, it depends.” I think that it should be an individual choice. I think that there are certain times when camera’s on is a good thing. I think when we’re having conversations that might be contentious, or if we’re having conversations that we might deem more important than others, seeing someone’s facial expressions, knowing that they’re physically there, there’s definitely something to that.
But not everybody likes being on camera, we weren’t built to see ourselves on screen all day. That’s not what we had ever been used to. I know that I’ve certainly gotten used to it, but there are some people that haven’t and that’s okay.
So I think the most important part is to set expectations at the beginning so there’s no ambiguity about it. So that way, recognizing that we tell people that managers, that leaders tell people, tell teams, “Just want you all to know that being on video for this meeting is optional,” or, “For this meeting, we’re going to need you to be on video because,” X, Y, and Z. Explaining the whys behind the dos, it’s going to help uphold that psychological contract when it comes to back expectations.
Mike Coffey: That’s great. And we’ll have to leave it there. Julie Develin is a senior partner at UKG’s HCM advisory and her contact information can be found in the show notes. Thanks again, Julie.
Julie Develin: Thank you so much.
Mike Coffey: And thank you for listening. You can find previous episodes, show notes and contact info for our guests at goodmorninghr.com or on Facebook, Instagram, and YouTube. And don’t forget to follow us wherever you get your podcasts.
Rob Upchurch is our technical producer and Imperative’s marketing coordinator Katy Bautista keeps the trains running on time, and I’m Mike Coffey. As always, don’t hesitate to reach out if I can be of any service to you professionally or personally. I’ll see you next week and until then, be well, keep your chin up.
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