Gen Z is making decisions based on how companies treat their employees

Corporate America is filled with cautionary tales of what not to do as an employer…

Companies would do well to heed them: 45% of Gen Z consumers said employee treatment affects their trust in a brand, according to an FTI Consulting report, making the issue more important than a company’s sustainability efforts (41%) or stance on social issues (37%). This will be especially important as Gen Z consumers enter their “peak spending years.”

“People are very keyed in, and they care, and, so, it’s not just about what you say in the moment and that immediate response to an incident that gets their attention,” said Rachel Rosenblatt, senior managing director at FTI Consulting. “It’s a show-me story.”

Gen Z may be more likely than previous generations to form opinions on companies based on their actions as employers because social media has given them access to information that hasn’t been readily available before, Tara Ceranic Salinas, a business ethics professor at the University of San Diego, told HR Brew.

What’s changing for HR? Over the past decade, HR has reckoned with the social media capability of “the world is your megaphone,” Rosenblatt said, as some workers have documented their employee experiences on public platforms like LinkedIn, Glassdoor, and TikTok. On the latter, for example, a former CloudFlare employee gained notoriety after sharing a recording of herself being fired, while a former SHRM employee created a series of videos detailing what he claimed was a disconnect between the employer’s stated mission and treatment of its workforce.

“[It’s] just this view into a corporation that people have really never seen before from the outside,” Ceranic Salinas said. “A lot of the things that used to be in what we thought of as a black box is now really a glass box.”

Since everything from employee communications and restructuring news to unionization efforts and organizational changes can be made public, HR pros are “moving closer to the center of corporate reputation management” in their strategies, Rosenblatt said.

“[It’s] the idea that you should always be thinking, ‘If I do this, someone else might see it,’” Ceranic Salinas said. “I don’t think that’s a great reason to do it, but if it’s going to change behavior and get organizations to treat employees better, I think it’s great.”

What else HR needs to know. HR should work closely with marketing, Ceranic Salinas said, because “any communication, no matter where it is from…that’s part of your branding.”

Traditionally, marketing teams handled external communications while HR teams were in charge of internal comms. But if anything can be public, Rosenblatt said, “it’s incumbent on the HR team to make sure that the way they are behaving internally and communicating internally is consistent with that external posture.”

How HR leaders respond to incidents is also important, Rosenblatt added, because Gen Zers care more about how a company responds to an action than the action itself.

“It is about the response, and that’s partially HR. That’s partially then how is it communicated, what are the leadership decisions that are made, what are the actions that are taken,” she said.