TAILORED BENEFIT PLANS STRENGTHEN EMPLOYEE REL ATIONSHIPS

The global economy is grappling with a poly-crisis, which poses a potential threat of an economic recession that could undermine the hard-earned gains made by Mexican households in the second half of 2022. With a general lack of an economic safety net and limited financial education, it becomes imperative for companies to prioritize the maximization of benefits and compensation for their workforce that should not be focused on monetary compensation but consider the real needs of each worker

Nima Pourshasb, Co-Founder and C e O, Minu, told MBN.

Companies should continuously evaluate what the preferences of workers are for compensation plans. According to Mercer’s evolution of Total Compensation study, the 10 most valued aspects of compensation are medical insurance, life insurance, having a doctor in the workplace, personal leave, workspace activities, savings plans, growth opportunities, a Christmas bonus and a healthy balance between personal and working life. These aspects are not limitative, so Niell recommended launching specific surveys in eac h company.

According to a poll conducted by Minu, seven out of 10 human resources professionals said a lack of resources is the main challenge to launching compensation and benefits programs. Additionally, the lack of strategic personnel to evaluate employees’ individual needs is the second biggest challenge.

Niell highlights that in Mexico, compensation strategies are still traditional and therefore not flexible enough since they only focus on delivering the worker a payroll, a meal voucher card and other dispersed, often unused benefits.

“Living paycheck to paycheck with little to no financial education has consistently forced people to defer to loans with alarmingly high annual percentage rates (APR), trapping thousands into crippling debt cycles. This situation is known to have a direct detrimental effect on people’s mental and physical health, which in turn undermines the productivity of companies and the country’s overall competitiveness,”

In terms of workers’ financial health, compensation plans can be a major boon. Over 69% of Mexican workers live without savings to face unexpected problems, and around 33% of workers are forced to ask for loans to cover their day-today expenses. Services like on-demand salaries, of which Minu is a pioneer in Latin America, can help workers access a part of the salary they have already worked for, which may prevent the need to loan. It could also improve their mental health and empower them. “Using our anonymized data, a Harvard Business School study found that our platform helped boost employee retention by 20% annually, representing an important time and cost-saving measure for organizations. Meanwhile, companies can also leverage the platform’s automated reports to inform and develop an integrated benefits and compensation strategy,” Poursh asb said.

Digitalization has settled new paradigms in team management. It also allows companies to stay connected with workers and listen to their actual needs to develop proper compensation plans, ensuring they use them and at the same time, make them feel more like part of the company. HR directors must start thinking outside of the box and understand that workers and their needs often vary.

NAVIGATING DOWNSIZING: LAYOFFS AND ALTERNATIVES

After a year marked by geopolitical uncertainty, rapid technological advances, and in anticipation of economic recession, companies across various industry sectors have been quick to announce layoffs as a default response. While layoffs may seem like a logical cost-cutting measure in times of market turbulence, experts question their effectiveness. “We have seen massive layoffs over the past months. However, unemployment in the US is at 3.5%, not a high number. These layoffs happen asymmetrically across industries,” said Mauricio Cortes, Sales Direc tor, Voxy.

Overwhelming evidence, including an article in Harvard Business Review (HBR), suggests that layoffs can hurt company performance, employee engagement and long-term profitability. As a result, industry leaders are urging companies to explore alternative strategies for managing their changing workforce needs. By involving personnel in the process and providing support and certainty, businesses can navigate this challenging economic landscape without undermining their viability.

Norma Sáenz, HR Director, AstraZeneca, emphasized the importance of a wellorganized layoff process that considers both the company’s goals and the wellbeing of the personnel involved. She highlighted that clear communication is key in ensuring certainty for both those who are laid off and those who remain at the company: “Something very important for this topic, in addition to how you support those who leave, is: What do you do with those who stay?” e xperts concur regarding the importance of communication to drive a process that is highly sensitive for talent. “Communication is integral in times of uncertainty. Therefore, employees must be involved in the process so that they can be part of the solution,” said Analaura Antuna, CHRO, Cotemar.

The decision to carry out layoffs is often driven by the perceived need for companies to cut costs in response to economic and market pressures. The COVID-19 pandemic has disrupted supply chains, reduced demand for goods and services, and caused significant economic uncertainty. In addition, geopolitical uncertainty ignited by the Russia-Ukraine war and souring trade relations between the US and China have added to the challenges faced by many companies.

Antuna stresses the importance of understanding the true reason behind layoffs to effectively address them. In the event of a recession, Antuna highlighted that this is a cyclical and temporary phenomenon, dependent on its underlying causes. “We need to examine the reasons that motivate the possibility of layoffs and there are many options to navigate them. The most important thing is to anticipate and plan for where the company is going,” she said, noting that a strategic vision can facilitate negotiations to identify alternatives to layoffs.

At the same time, rapid technological advances have led to the displacement of some jobs and the need for new skills and talent. Against this backdrop, companies may feel compelled to take action to reduce costs, and layoffs can seem like a logical response. However, the costs of layoffs may be greater than the benefits, particularly in the long term. “We should always prioritize treating people well and exhaust all resources. There are different alternatives, from negotiating payments or benefits to moving personnel,” said erick Díaz, HR Director, Atento.

He also highlighted different approaches to carrying out layoffs. Díaz emphasizes that while it can be challenging to determine whom to let go, utilizing “performance assessments” can be a valuable tool and should be as effective as possible. Additionally, these assessments should include a long-term review. “Seamless performance assessment is an important element in the layoff process,” adds Díaz.

The Power Of Measuring Roi Toward Busine Ss Success

To maximize the potential impact of HR training programs on business outcomes, it is crucial to measure their ROI. Unfortunately, not all HR executives recognize this significance and neglect to do the analysis. This oversight can result in wasted resources, missed opportunities and an inability to showcase the value of HR training programs. Voxy’s Sales Director for Mexico, Mauricio Cortés, discussed the essential measures that companies should take to measure the ROI of their HR training programs and how this can positively impact business success these initiatives. According to a survey of over 350 HR executives, only 11% measure the ROI of their training programs, while a staggering 62% do not measure it at all and 27% measure it only in a few programs.

Before implementing a training program, it is important to align it with a strategic KPI and have a specific goal in mind to avoid it becoming a mere wishful thinking exercise. “Smart methodologies entail skill mapping to recognize knowledge gaps. This is crucial to reach the company’s objectives,” said the director. It is also crucial to communicate what the program aims to achieve.

Mexico

Many companies invest in training and development programs for their employees but surprisingly few measure the ROI of

Measuring and communicating the impact of training initiatives increases their efficiency and effectiveness. Demonstrating the ROI and proactively communicating the impact of learning and development initiatives will also help secure the presence of learning & development (L&D) in the future. According to a recent survey, 53% of L&D professionals believe that the area should be represented in the executive leadership, explained Cortés.

To demonstrate the effectiveness of training programs, it is important to measure the employee retention rate, internal mobility data and the ROI in terms of time saved and productivity gains. For retention rates, companies must compare those who participated in the training with those who did not. A retention program can determine whether loyalty and commitment have increased due to employees’ participation in the training. Crucially, 25% of employees believe their skills are not being utilized, making them 10 times more likely to seek other employment oppo rtunities.

Internal mobility metrics also provide insight into whether the training program is working. If employees are growing organically within the company and filling strategic positions, then this is an unmistakable sign that the program is successful.

Calculating the ROI of training programs is crucial to determine whether they are worth the investment. By saving time with customized programs and developing skills to increase productivity, training programs can be an excellent investment. To expedite the ROI of such a program, companies ought to take certain crucial measures such as identifying gaps, tailoring the learning experience, clearly communicating expectations and regularly providing feedback.

Measuring the impact of training programs on business and understanding their success and profitability is crucial. Leveraging AI to analyze and understand data is similarly important in developing an inclusive development plan. By identifying where different audiences are in their skill set, training programs can be tailored to their needs, making them more inclusive and effective.

Conflict Resolution Frameworks For Conducive Solutions

Conflicts can arise among employees, teams or departments, affecting productivity, employee morale and overall company culture. According to Lorena Manrique, Human Resources Business Partner, Natura, effective conflict management strategies, as well as the role of Chief Human Resources Officers (CHROs), are critical in addressing these situations. To foster a positive and resilient workplace culture, Manrique presented a conflict resolution framework built on three essential pillars: Culture and Leadership,

Colleague Roles in Conflict and CHRO Mediation.

By adopting these pillars, companies can create a healthier and more collaborative work environment where conflicts are constructively resolved.

“Workplace conflicts are inevitable, especially in a diverse and inclusive office. Nevertheless, if managed effectively, they can lead to a more resilient, productive and dynamic workplace culture,” said Manrique. As such, companies must have effective conflict management strategies in place and for CHROs to play a key role in promoting healthy communication and collaboration among employees.

Workplace conflict can manifest in various forms: differences in opinions, competing interests, personality clashes or misunderstandings can all arise. If left unaddressed, workplace conflict can escalate and impact team dynamics and employee engagement as well as organizational performance. Consequently, companies must have a transparent and accessible conflict resolution framework in place so that it can produce positive conversations and solutions, said Manrique. This process begins with establishing culture, leadership expectations and guidelines, which should clearly outline acceptable and unacceptable behaviors within the workplace. In doing so, organizations can avoid placing their leadership and CHROs in an unintended referee role, which can convey favoritism and dissuade employees from expressing their concerns about workplace friction.

Understanding the collaborator’s role in the conflict is crucial in effectively managing differences of opinion and preventing spats from escalating into bigger problems when a conflict inevitably arises. This is especially important considering the inherent biases, assumptions and beliefs that can trigger negative feelings and reactions, which CHROs must be conscious of to manage conversations effectively, said Manrique. To identify the root of the problem, CHROs should listen intently to key words and phrases and keep an eye on reactions, which can often reveal underlying issues that need to be addressed.

How to administer these differences is crucial as conflicts left unaddressed can lead to bigger and more pronounced problems, such as a toxic work environment, decreased employee engagement and diminished productivity, as well as increased employee turnover.

KPI ANALYSIS TO REVALUE HR DEPARTMENTS’ IMPORTANCE

While human resource (HR) professionals are not traditionally data analysts, the digitalization of their departments increasingly calls for the ability to make data-informed talent decisions so they can reaffirm their value-added to the business.

This is a relatively new challenge for HR leaders, though a crucial differentiator in a digital-first economy. To this end, HR leaders are now tasked with establishing relevant key performance indicators (KPIs) and an analysis framework so they can follow, assess and determine the effectiveness of talent programs to inform future talent development initiatives. However, because HR analytics is relatively new, industry leaders suggest companies stop focusing on recruitment alone and foster a broader perspective. Here, data analytics can play a major role to ensure that CHROs set up a system that will generate the data necessary to provide the added-value company leaders are looking for. eduardo Asaf, Leading Partner Talent and Organization, McKinsey, said HR departments are commonly underappreciated since they are perceived to be focused only on recruitment. Nevertheless, HR also involves duties like onboarding, development and retention, which are essential for companies and must be backed by measurable metrics. “Organizations more active with HR data analytics see strong results, including being twice as likely to improve their recruiting and leadership pipeline, three times as likely to realize cost or efficiency gains and 3.5 times as likely to get the right people in the right jobs,” reported Korn Ferry insights.

Despite the potential benefits of HR data analytics, many organizations are still in the early stages of developing their capabilities in this area. This could be explained by the fact that companies do not perceive HR departments as strategic destinations for investment. Juliana Felix, Talent and Learning Consultant, LinkedIn, said HR departments have the tools and potential to show their real value and KPIs can play an important role in value creation. “Three main metrics that help in having more investment in talent are recruitment time, quality and retention. However, as HR, we must properly measure these metrics to show the true value HR departments bring to the organization,” she added.

HR data analytics capabilities vary in sophistication, from basic HR information systems (HRIS) to advanced departments offering world-class predictive modeling that incorporates social media, according to Korn Ferry. Historically, however, most organizations approach workforce planning as an annual exercise focused on cost, with little insight into whether employees can achieve their performance and revenue goals. Overall, HR departments face significant challenges in gathering and analyzing critical information to benefit their organizations including rigorous HR data analysis, inaccurate information scattered across the company, absent analytic skills among HR staff and inadequate investment in technology.

However, since personnel management is not only limited to HR departments, Alejandra Rodríguez, CHRO, Bocar Group RHR directives, believes CHROs must identify KPIs that are also important for other areas like rotation, talent availability and personnel replacement plans, among others. By identifying these factors, HR departments can identify actions that are aligned with the company’s objectives, and if they are not aligned, they can stop them before they spiral out of hand.

The main challenge in the use of data obtained by KPI tools is that not all the information should be spread throughout the company. What is more, measuring specific data may lead to information that is difficult to interpret.

“We must maintain KPI models as simple as possible and identify the objectives that can align with the directives’ goals. Additionally, we should not implement the same KPIs on all levels; it should depend on the interests of each area. Doing this can help us trace a route to follow in each of the company’s areas,” said Lauren Burdick, Head of People and IT, Nuvocargo

Compliance For Recruitment Processes Is Essential

Mexico’s federal labor law is rapidly evolving, presenting challenges for employers to keep up with compliance requirements, especially in the recruitment process. Alfredo Kupfer, President of the Chamber’s Committee on Labor Affairs and Human Capital, American Chamber of Commerce of Mexico (AMCHAM), highlighted the importance of understanding and adapting to these legal dispositions during the recruitment processes to avoid legal complications and implement best p ractices the Federal Labor Law (LFT), Mexico’s Constitution and international treaties ratified by the government. “All the legislation on discrimination is applicable in labor and recruitment matters. However, there are further effective elements needed toward full compliance,” explains Kupfer.

This legislation contains general guidelines regarding principles of non-discrimination. Kupfer emphasizes that violating these principles does have legal consequences, even when the recruitment is carried out by third parties, hence the importance of understanding the legal framework regarding anti-discrimination. “Knowing and complying with good practices and legal standards is essential. It has become not only a matter of compliance but even a differentiator for competitiveness,” said Kupfer.

Recruitment is a critical stage of the employment lifecycle. Here, noncompliance with labor laws can lead to legal disputes, fines and reputational damage. Mexico’s labor landscape has undergone significant changes in recent years, including labor law reforms aimed at strengthening the rights of employees. These reforms, such as the Federal Labor Law and the USMCA, have implications for recruitment processes, including requirements related to job postings, candidate selection, employment contracts and docu mentation.

According to Kupfer, while there is no specific regulation regarding recruitment processes, these procedures are covered by general legislation contained within

The concept of the working relationship, which is covered by the LFT, lies at the core of compliance. It is guided by principles that extend from before the relationship begins to its conclusion, said Kupfer. “The law sets the standards to prevent discrimination in employment relationships and to provide guidelines for wages, benefits and termination. The nondiscrimination principles also have to guide recruitment and selection p rocesses.” e nsuring compliance in recruitment processes is essential for employers to mitigate risks and avoid legal issues. e mployers must therefore also be aware of any updates or changes in labor regulations, stay updated on best practices and establish robust internal processes to ensure compliance during recruitment activities. “It is common to entrust specialized third parties that have specialized tools and technology to do recruitments. It is also important to be aware because the actions of these third parties can have negative effects if they do not comply,” added Kupfer, who also emphasized the importance of dat a privacy.

He also mentioned recent efforts to advance toward neutral recruitment, free of discrimination: “It is important to evaluate the appropriateness of reviewing personal background, socioeconomic studies and requesting other sensitive information.” Studies aiming to track the socioeconomic status of applicants remain somewhat commonplace in the Mexican labor market.

While some information is relevant to the position to be covered, employers must differentiate between general personal information and sensitive information. Recruiters have to explain the use and protection of their data and gain expressed consent from the candidate.

CLOSING THE HR TECH GAP: A CHALLENGING, YET ATTAINABLE GOAL

The importance of keeping pace with technology is not lost on Chief Human Resources Officers (CHROs) who must overcome a significant learning curve to ensure the long-term competitiveness and success of their organizations, said e na Torres, People Business Partner Director, Mercado Libre. To effectively leverage technology applications, CHROs must strategically select human resources technologies that “align both with the business needs and identify pain points.”

The ability to make data-informed talent decisions poses a relatively new challenge for HR leaders, but it is a crucial differentiator in a digital-first economy that reaffirms the value they add to the business. Many HR departments have recognized the strategic contribution to sustained competitiveness and success, leading to significant investment in HR technology and driving important innovations. However, despite these advancements, many HR leaders and their departments are still relatively new to data analysis, posing challenges in leveraging HR technology to its full potential.

This complex landscape requires CHROs to prioritize bridging the HR tech gap to facilitate strategic decision-making across all departments. By leveraging HR technologies, CHROs can optimize talent strategies, enhance productivity, reduce turnover and heighten business competitiveness. This technology will allow them to make datainformed decisions on talent incentives, optimize investment in technologies and align HR practices with organizational goals.

“To create a productive and harmonized technology ecosystem, CHROs require adequate organizational data, often spread across the enterprise, to make strategic HR technology investments,” said Torres.

Consequently, CHROs would benefit from coordinating with other company departments to ensure that technological investments align with the company’s objectives and the pain points it needs to tackle.

This strategic analysis will help companies avoid unnecessary technologies that could potentially complicate and undermine operational processes. To identify these deficiencies, or verify that the adopted technologies have their intended effect, companies would benefit from establishing new key performance indicators (KPIs) that reflect the post-COVID-19 workplace reality. “These metrics will differ from company to company since they have different business needs, industry demands and work models.”

At the same time, “With greater digitalization CHROs must be careful to shelter connectedness and collaboration within their organization,” warns Torres. This is a challenge that is highly contingent on a company’s work model but necessary to foster and encourage collaboration for problem-solving. A deep connection can be achieved in various ways, such as the adaptation of spaces to confer connectedness, talent upskilling and reskilling programs as well as company events.

Altogether, this can go a long way toward ensuring that collaborators engender a sense of culture that could enhance a company’s overall performance and agility.

Altogether, CHROs face the challenge of balancing the digitalization of their departments in harmony with the evolving workplace expectations of employees. This requires that they accelerate their digital analysis capabilities as well as their ability to effectively communicate with other C-suite executives for more comprehensive integration of technologies.

TOXIC WORK ENVIRONMENTS: HOW TO IMPROVE WORKSPACE DYNAMICS?

e nduringly dysfunctional work environments can lead to corrupt cultures that are harmful to employees’ well-being and, ultimately, the company’s longterm viability. While pinpointing a direct causal relationship can be difficult, Chief

Human Resource Officers (CHROs) play a vital role in supporting the development of a respectful, purpose-driven culture. To address symptoms of workplace dysfunction, industry leaders highlight the importance of having prepared team managers to identify risks and tackle problematic symptoms before they metastasize into a substantial problems.

“People do not leave companies, they leave experiences,” Blanca Ruth Ortuño, Sales HRBP Senior, Nestlé, told MBN. If a company experiences an unusually high turnover rate, it may be time to reassess the work environment, she said. Aspects that are important to pay attention to are usually associated with burnout, like excessive workload, not respecting employees’ personal time and a lack of trust. “The COVID-19 pandemic changed company and employee relationships. Now, people value more flexibility and prioritize spending time with their family as well as other activities that create value for them. Organizations should not make them feel bad for being at the gym at 8 p.m. instead of being online to attend company matters,” said Verónica Muñoz, HRBP and Talent Director LATAM, the e stée Lauder Companies.

When finding a job, people are now looking for companies that are conscious and contribute to society, according to Muñoz. The working culture therefore plays an important role when people decide where to work and leaders are the main factor contributing to this culture. “Developing proper infrastructure, processes and tools is important. However, it would be worth nothing if you do not have good management. An indicator of a toxic environment is the kind of leader the organization has. If you do not have a good leader, you may have a toxic environment,” José Guerrero, HR Director, Alpura, commented.

Defining the symptoms of a dysfunctional work environment can be challenging because there are often many contributors that affect employees in different capacities. Nevertheless, possible early warning signs include high turnover rates, climbing stress levels, diminishing transparency, normalization of aggressive language and behaviors, favoritism and receding advancement opportunities. Altogether, if ignored, these manifestations can have a detrimental effect on employee morale, productivity and the company’s long-term viability. As such, companies need to be aware of the signs of a toxic workplace and take steps to address any issues before they have a lasting impact on the company’s culture, performance, and bottom line. Organizations should aim to generate engagement with employees by both listening to them and addressing their complaints. “When people are engaged and working in a healthy working environment, they perform over 300% above the average,” said Salvador Ortega, HR Sr. Director LATAM, Newell Brands.

Ortega highlighted the importance of inclusion in the workplace to construct healthier working environments and stressed that companies must start asking themselves “How many spaces are we opening up to allow employees to be themselves?” e xperts say that working spaces should aim to find a common ground for every worker to coexist but always consider that every employee is different in aspects like gender or sexual orientation, among other important factors. “If you need to force yourself to belong to an organization, you will drain yourself. Not allowing people to be themselves will lead to toxic working environments,” added Badía Rebolledo, CPO, Krispy Kreme.

According to Badía, companies need to identify the factors that could lead to a toxic environment and address them promptly to prevent any negative impact on productivity. She emphasized the importance of HR departments being prepared to remove “toxic elements,” even if those individuals are seen as important for delivering a project on time. While acknowledging that there may never be a “good time” to remove employees, she stressed that it is sometimes better to act quickly. By doing so, companies can prevent further damage and create a healthier, more productive workplace for all.

FROM WORK-LIFE BALANCE TOWARD WORK-LIFE INTEGRATION

Among employees, one of the most prominent incentives driving the Great Resignation, or Great Reshuffle, is the desire to draw a clear line between their work responsibilities and personal life. While this demand has since become a de facto standard, remote and hybrid work models effectively blur the line between work and personal life in practice, focusing on outcomes and quality of work rather than when and how long work is done. This natural progression has effectively led to a work-life integration model that offers benefits to some while presenting significant challenges for human resources (HR) executives and companies.

To navigate this paradigm shift, industry leaders suggest placing the employees’ life priorities and incentives first so that HR leaders and companies can effectively adjust to employees or find personnel that adapts to the organization’s core values and priorities.

e xperts concur that remote work brought new paradigms for work. Nevertheless, workers adapt differently depending on each case regarding their position or personal priorities. “The world after the pandemic changed office work and the technology industry. The notion of time and space was lost. Ultimately, it is about knowing how to integrate hybrid work into the reality of each individual,” said eduardo Villarreal, People

Performance and Transformation Director LATAM, AB-Inbev.

Maite Delgado, People, experience & Culture Director, Scania Mexico, explains that life integration seeks to bring work and personal life closer together instead of drawing lines between them. e mployees address their responsibilities at the time that works best for them. In the life balance model, firm boundaries to dedicate all attention to either work or personal life is preferred. “The employee is given the option to choose, and a framework of rules is offered to gain freedom within this system. The employee chooses where, when and at what time to work, and we express what is expected of them as well as what the main guidelines of this system are,” says Delgado.

Pedro Obregon, HR e xecutive Director, Viva Aerobus, recognizes that there is a clear impediment to applying the same model for all employees as some positions cannot deploy life integration to the degree that others can. “Here is where companies also must clearly define their values and work models. There has to be a match between company and employee as well,” he added.

Gladis Juárez, Vice President HR Mexico & Central America, Schneider e lectric, emphasized the importance of individuals being sure about their plans. She added that the company also must accompany the individual in figuring out what model works best for them according to their own goals. “The first part is asking: what does the person want as an individual? Recognize if your job or role gives you what you are looking for on a personal level.”

Obregon added that this is where the importance of a match between the employee and the company’s values and objectives becomes increasingly relevant, as some positions can only work in a single model. e mployees must be aware and comfortable with this. “We must focus on prevention,” he added.

Furthermore, experts explain that these new paradigms can help reduce burnout among personnel. “The concept we start from is that work is part of life because it takes up a large part of our vital energy,” says Ricardo Combariza, Chief People Officer, Covalto. e xperts agree that explaining what is expected of employees and what priority each of their tasks has can also build a harmonious working approach. “There is no better way to help an employee than by asking them what they are looking for and explaining what is expected of them,” said Juárez.

Combariza shares that the authorities also have a part to play in deploying legal frameworks and policies to address problems that could harm employees emotionally. To this end, Delgado added that people in leadership positions must be down to earth and have a diverse team to understand the full picture of different employee needs.

FROM BURNOUT TO DISENGAGEMENT: ADDRESSING QUIE T QUITTING

Despite the anticipated economic downturn and waves of massive layoffs, quiet quitting is not expected to dissipate as employees continue to strive to reclaim agency and establish work-life boundaries. The buzzword emerged in 2H22 with a negative connotation among employers, media and academic institutions. Regardless of the concept’s interpretation, it is up to businesses to understand and respond with practices and policies to curb quiet quitting in their organization and check its associated risks.

While this complex phenomenon is still unfolding, industry leaders highlighted the importance of implementing strategies to maintain a productive and engaged workforce, such as open and honest dialogue, trust-building, recognition and compassion.

“Quiet quitting happens when employees disassociate from the company due to being burnt out, resulting in employees putting in the bare minimum effort,” said Maria Jóse Arroyo, Total Rewards HR Director Mexico, Panama, and Guatemala Cluster, Procter & Gamble.

Quiet quitting has become a noticeable trend in the workplace, with employees silently disconnecting from their work rather than quitting openly. While this can be seen as a way for employees to establish work-life boundaries, it can negatively affect businesses. As this trend continues, companies need to comprehend and tackle the underlying factors to sustain a productive workforce.

e xperts describe quiet quitting as a lack of engagement and commitment to work, with employees showing no willingness to go the extra mile. The pandemic has made this issue more prevalent as employees re-evaluate their work-life balance. As a result, companies must now offer a purpose that employees can connect with to avoid work turning into a strictly transactional relationship. e xperts emphasized the importance of respecting people’s autonomy to avoid disengagement from the organization. While quiet quitting should not be viewed as entirely negative, companies must identify why employees may no longer want or be able to give their all to the org anization.

“A comprehensive and well-beingoriented environment should be implemented. Otherwise, work becomes merely transactional and can push the employee to isolate mentally,” said Arturo Corominas, Director of Learning and Transformation, L’Oréal.

Companies should strive to create a culture of trust and genuine well-being among employees. This can be achieved by ensuring that managers are committed to building valuable relationships with their team members. Companies must invest in human relationships since they are a fundamental element for the proper functioning of companies. Additionally, they can provide channels for employees to provide feedback, which may foster a sense of belonging and support in addressing any issues causing demoralization.

Industry leaders also emphasized the significance of monitoring employee turnover rates and taking measures to ensure that employees feel valued, which can help reduce voluntary resignations. “Mentally isolated employees who do not quit can experience dissatisfaction and cause additional costs to the company,” said Carlos Vivar, Talent Director, Arca Continental.

Leaders play a crucial role in preventing quiet quitting and maintaining a positive work environment. Their behavior and approach to managing their team can influence employee engagement and motivation.

To reduce quiet quitting, leaders can build trust with employees through open and honest communication. This can be established through a transparent and nonjudgmental dialogue, allowing employees to feel comfortable expressing their concerns and ideas. The approach can help leaders identify potential issues before they escalate and become more challenging to address. Another strategy is to recognize the importance of compassion and empathy in leadership. employees want to feel that their leaders care about them as individuals, not just as workers. Leaders who show compassion can create a sense of community and belonging in their team, which can be critical to maintaining a positive work environment. experts also emphasized the importance of recognition and positive reinforcement in preventing quiet quitting. employees who feel appreciated are more likely to remain engaged and committed to their work. Leaders can recognize their employees’ achievements and contributions through various means, such as regular feedback and acknowledgment of their hard work.

Moreover, the panelists highlighted the importance of leaders developing a comprehensive understanding of human resources (HR) management. Leaders who possess knowledge of HR procedures and practices are better equipped to handle employee-related issues effectively. Leaders’ attitudes and behaviors toward their team, combined with their expertise in HR, can help foster a positive and engaging work environment that encourages employees to stay and grow with the organization. “We do not necessarily have to be a family but it is essential to foster a climate of authentic trust and well-being,” Corominas concluded.