Source: Globis
Date: 20 April 2007 

Globis continues to build on its reputation for establishing the business case for conflict resolution processes. Following work with a department of a large organization over a 6 month period, the organization was able to report a 93% reduction in sickness absence and a 60% reduction in labour turnover and associated costs. These reductions were valued at £71405. The department was encountering rising levels of tension and conflict as well as embarking on a significant amount of change.

Globis worked with the management team to build a framework for a forum for debate, discussion, questioning, raising awareness of objectives and building relationships.

As recently indicated in the DTI Gibbons Review, the business case for dispute resolution methods in the workplace is sound and is gradually becoming underpinned by more evidence.

Notes on research:

• Costs measured by base salary only – total compensation would have produced a much higher figure
• Measured difference relating to previous 6 months data, prior to Globis involvement
• 1st 6 month sickness measured within management population of 3 as 70 combined sick days out of 330 (21%) @ basic salary per diem rate        
• 220 days used as total maximum ‘normal’ working days per year
• 2nd 6 months sickness measured a 5 combined sick days = 93% reduction�
  Labour turnover
• Department had a team of 30 people 
• Average non-management base salary calculated at £25k
• 10 employees left during previous year
• Direct replacement costs calculated at £5k per employee 
• 2 leavers during 6 month period (4 annualised) = 60% reduction in labour turnover and 60% reduction in direct replacement fees
• Cost factors for department went from £94,590 to £23,185 saving £71405 (£142,810 per annum)
• Total staff in organization = 18,000 
• Multiplication of *6 (1 department of 30 across each function) used to estimate annual organizational cost of £856,860�
  * Minimum levels used to illustrate likely impact