Building And Sustaining Organisational Trust

Recession fears are mounting, along with inflation, the Russia/Ukraine war, and the ongoing pandemic are weighing on the global economy. These events have impacted businesses worldwide.  In particular, the job losses caused by the COVID-19 pandemic have been felt across all sectors and industries. The leisure and hospitality industry has been particularly hard hit, with millions of jobs lost worldwide. Staffing needs are being re-thought by many organisations in different industries even now. These include freezing hiring, rescinding offers, and even laying off workers.

In order to stay afloat, organisations have to make tough decisions about their workforce.

In May, Carvana Co, an online retailer of used cars, laid off about 2,500 employees. The executive team has to forego their salaries for the rest of the year to pay severance to those whom they had to release. Netflix reported a loss of 200,000 subscribers in the first quarter of 2022 and responded with a series of highly publicised layoffs. The CEO of Shopify Inc. announced on July 26 that 1,000 employees, or 10% of the company's workforce, were laid off. These cuts come at a time when the global economy is facing significant challenges, with many organisations feeling the need to tighten their belts to weather the storm.  This has caused significant challenges for the affected employees, who will now have to look for new jobs in an already difficult market. As a result, employees have lost their trust in their organisations and feel being treated unfairly. 

So what can organisational leaders do to sustain the trust of their employees knowing that workforce redundancy is inevitable in light of averse business cycles to avoid mass layoffs? Redeployment, job redesign, job rotation, and creating in-house capability are all viable options for organisations looking to keep their workforce intact during times of change. By doing this, organisations can keep the faith and trust of their workforce and in turn, retain employees during both good and bad times.

According to Dr Peter Cheng, positive outcomes accrue when leaders are compassionate; among the increase in employee trust, productivity, commitment, reduced staff turnover and being an advocate for the organisation.  It is crucial for employers to be transparent with their employees and keep them updated on the organisation's situation. 

In these uncertain times, it is more important than ever to build and maintain the trust of the workforce by showing compassion and understanding towards your employees. 

Leaders should let their employees know that they are there for them and value their contributions. By doing this, leaders not only build employee trust but also improve staff morale and motivation.

As a leader,  you can create a more compassionate workplace for your employees so that in good and tough times, the employee trust in the organisation will not erode. When the business cycle turns in favour of the organisation, it will be ready to leverage the upswing with the support of a trusting workforce. 

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