Employee relations are the ways in which the company interacts with the staff, delivers policy information and works to create a more productive workplace. By not creating good policies for employee relations, you are creating issues within your company that could stop growth and affect your future success. When you understand the objectives of employee relations, you are more apt to put the proper resources and time into good policies.


Developing policies that present company information, such as the proper way to submit a time card and the list of employee benefits, helps to create clarity between the company and staff. When employees understand what management expects and how to work within the structure of the company, then the workplace becomes more efficient. Creating confusion by not relating important information to employees can lead to a drop in productivity and increased turnover among the staff.

Employee Retention

A focus on employee relations creates a corporate culture, and corporate policies that focus on these relations help to increase employee retention. Company turnover costs money in recruiting new employees, training new employees and getting new employees up to speed quickly. By developing policies that address employees' needs and help to make the staff feel respected, it is less likely that the company will experience elevated levels of turnover. Some examples of employee relations policies that help with employee retention include unpaid leave, health benefits with counseling options and a retirement program.

Legal Issues

The federal, state and local governments have laws regarding employment and treatment of employees. Some potential legal issues include discrimination in the workplace and harassment. The employee policy manual outlines what the company's policy is on all of these legal issues, the best ways for employees to report violations and the penalties involved for people who violate company rules or mandated laws. The objective of employee relations in this instance is to create a legal framework that protects the company and employees while creating a productive workplace.

Company Growth

Employee relations activities include annual employee reviews and the ongoing development of employees through training and managerial guidance. When the company and employees work together on developing employee careers, the employees benefit from a clear path to promotion and advancement in the company. The company benefits because future management candidates are identified, and the necessary resources can be applied to training those employees that will guide the future success of the company.