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What Social Contract Do You Have With Your Employees?

What Social Contract Do You Have With Your Employees?

I was struck by a recent news report about a car company laying off workers to transition from traditional manufacturing to more tech-savvy, forward-thinking approaches to transportation. Employees felt they bought into a commitment and the employer wasn’t holding up its end of the bargain. They had committed to focusing on developing manufacturing skills specific to this employer and relying on a pension program that rewarded long-term career commitment.

Losing a job with their employer was devastating. The employer, meanwhile, felt they had to go through this transition in order to survive and grow in the coming years, and to return shareholder value. Without the shift, it would lose precious market share.

Who is right? They both are.

And it begs the question: What is the agreement between an employer and employee, beyond compensation and benefits? What are the inherent assumptions on each side of the table? And why aren’t we having a more direct dialogue about them?

[Related: 5 Ways To Build Courage And Competence For Difficult Conversations]

Some call the agreement brand values, some call it culture, some mission. However, these all tend to be externally facing, focusing on market share and paths to profitability. The employee component of this is the critical path to delivering those, but companies often don’t define the agreement they make with you when they become your employer.

Yes, there are tons of dependencies at play here - employee performance and employer performance at the very top of the list. But let’s assume growth and stability on both sides for a second. In that scenario, what is the agreement exactly, over the long term? Can we move beyond “let’s wait and see how next year goes?”

This is getting at a more holistic view of the expected give-and-take between employer and employee. Things like personal expression, professional development, safety of risk-taking for the sake of innovation and growth, job stability in times of need, and uncertainty. That what you put in will be recognized, appreciated, rewarded. Inclusion is a big part of that equation.

For an employee to choose a work environment because it is considered inclusive is a leap of faith. How do you evaluate inclusivity when you are in a job search? Is it by pictures of people on a company website, or press releases about diversity and inclusion events hosted by the company? Is inclusion the latest label that has been applied to the culture to appeal to candidates, or is it being lived and breathed within the company day to day? How do you really know?

[Related: Six Key Steps to Research Company Culture]

The temptation for employers is to apply broad terms to how they describe the work culture — things like "collaborative," "flexible," "inclusive," even going so far as to say "you can be your whole self at work."

But is that what is modeled in successful paths to leadership within the company? Yes, a company may be in transition to embrace more of those values, so it can be hard to see evidence of it working broadly at a senior level — but there need to be concrete examples somewhere at or toward the top for those values to really be true.

For all the time leaders spend on missions and brand values for their companies, they would be well served to do the same on social contracts with their employees. The best ones align with their external positioning, are tied to measures of impact on the business, and they have the ultimate proof — examples of the social contract lived out by successful leaders across the company.

And like any good contract, they outline the expectations of each party in fulfilling that agreement.

[Related: How Women Can Create Networks for Success]


Throughout her twenty-five-year career, Michelle Bogan has mentored colleagues and clients, founded and led women's groups, and helped promote many women and men to leadership positions. In 2018, she founded Equity for Women to advance the mission of empowering women at work.

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