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Company as Kin

There is growing interest in a lasting, reciprocal — familial — relationship with workers. And it could mean good things all around.

January 5, 2014

It’s the 1950s again in corporate America.

Or at least at some important players in the business world, such as EY (formerly Ernst & Young), Ford and Google, where there’s a renewed focus on close, long-term connections with workers. And what could be called the “Company as Kin” movement promises good things all around — for organizations, workers and society.

The employment compact of the 1950s and ’60s was symbolized by the “company man” who received a job for life along with health care and a pension in return for hard work and loyalty.

That deal disintegrated in the 1970s, ’80s and ’90s, as union power slipped, global competition increased and firms focused on shareholder returns. Employees became disposable. Over the past decade, though, there’s been growing interest by organizations in a lasting, reciprocal — familial — relationship with workers. The trend is driven by factors including millennials’ thirst for feedback, new transparency into workplaces and the growing importance of a good reputation among investors and customers.

For proof companies are taking on kinship characteristics, look to the streets of San Francisco. In the past few years, tech workers living in the city have come to take private buses to Silicon Valley employers such as Google — as if getting rides from their parents. Those tech firms also often take care of employees when it comes to food, exercise facilities and socializing. Like members of an extended family, today’s techies even proudly share the company name: Googlers, Facebookers or Yahoos.

Or consider accounting firm EY’s motto to job seekers: “Opportunities that stay with you for life.” The company also has “counseling families.” These are groups of EY employees in the same industry or specialty who mentor and encourage one another, helping to forge bonds among professionals who may spend much of their time at client locations. And just as parents are devoted to their kids’ development, EY didn’t cut learning and development for U.S. employees during the country’s recession.

For companies, higher levels of trust fuel better collaboration and encourage employees to be innovative.

Ford, too, is pushing to deepen ties with workers. As I mentioned in an earlier column, its Sustainable Workforce Initiative includes a commitment to training, improved safety and a personalized health care program to help workers manage chronic health care needs.

This updated, more-compassionate compact around work is not universal. And many company “families” are dysfunctional. Corporate profits as a share of the U.S. economy hit an all-time high in 2012 while wages and salaries matched an all-time low. Workplace flexibility often is not extended to workers who need it most. And just 30 percent of U.S. full-time workers are engaged at work, Gallup says.

The paternalism of the “Mad Men” era — which could carry an unpleasant whiff of infantilization — isn’t returning. Workers today have to fend more for themselves when it comes to health care and retirement. And there are few tacit promises of permanent employment. But more and more firms want to stay literally “linked in” with their employees for the long haul — in part because of future business opportunities with people who move on to become contractors or employees at potential clients. As an EY spokeswoman told me: “We want to establish lifelong relationships with our people.”

In other words, company and workers as kin. As in-laws or cousins or siblings who don’t necessarily depend on each other but whose connections never die. And who both gain.

For companies, higher levels of trust fuel better collaboration and encourage employees to be innovative, as Great Place to Work Institute co-founder Robert Levering has pointed out. Gallup CEO Jim Clifton adds that engaged employees generate more new customers and have “the most entrepreneurial energy.”

For employees, the emerging employment deal increases the chances that a job will be a good one. And Gallup has found that a good job is what people around the world want most — more even than they want love, money, food or shelter. Satisfying, meaningful work can be the foundation of a life well-lived.

Plus it’s possible that a return to a familial worker-company bond will boost the economy and reduce inequality. After all, seven of the eight best years of economic growth in the second half of the 20th century took place in the 1950s and 1960s. Yet income was spread more evenly during those decades — when something akin to a companies-as-kin philosophy reigned at U.S. workplaces.

An updated version of that employment deal may be just what we need for the 21st century.

Ed Frauenheim is Workforce's associate editorial director. Comment below or email him at efrauenheim@workforce.com. Follow Frauenheim on Twitter at @edfrauenheim.