HR Management & Compliance, Talent

With HR’s Help, Employee Network Groups Can Improve Retention

From the employer’s perspective, employee network groups can boost engagement and retention—or they can create divisiveness. To ensure the former, employers need to be involved from the start.


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By adopting a policy and welcoming network groups, businesses can encourage members to have positive effects in the workplace, according to Ray Friedman, a professor of management at Vanderbilt University’s Owen Graduate School of Management.

Friedman offered tips on policies and best practices during a recent presentation at the 2017 Employers Counsel Network Conference in Nashville, Tennessee.

One or Many Groups?

When adopting a network group policy, employers often wonder whether to sanction one all-encompassing “diversity group” or allow workers to create individual groups based on different identities, Friedman said.

The clear winner, according to his research, is smaller, individual groups. One of the things that determines a group’s success—which he defines as helping employees to feel more comfortable and be more effective at work—is how strongly workers identify with the group. This applies regardless of whether a group is based on gender, religion, or ethnicity, for example. If an individual doesn’t strongly identify with the group’s identity, neither the employee nor the employer will reap the potential benefits.

Encouraging Membership and Leadership

Some employers assume that network groups form because employees are dissatisfied at work and they fear that the groups will become confrontational, Friedman said.

But that’s not what his research has shown. Membership is driven by social identity and a desire for career enhancement, he determined. Groups provide mentoring and help employees feel included. They improve retention and employees who participate have better “career optimism,” he said.

But for that to happen, an employer must signal that it views participation and leadership in network groups in a positive light. It’s especially important to encourage management-level employees to join, Friedman said. Reduced turnover is linked to groups that have management in leadership positions. And “career optimism” is found when employees receive mentoring from group leaders.

Conversely, when a business reacts negatively to a network group, ambitious employees don’t join and the employer’s assumptions create a self-fulfilling prophecy. “So a bit of this is under your control,” Friedman said.

Benefits for Employers

In addition to improved engagement and reduced turnover, network groups have other benefits for employers.

First, they can help a business achieve its affirmative action or diversity goals. It’s not enough to hire minorities, Friedman said. The key is moving them up in the organization, and network groups can make that very simple. They allow workers to make high-level contacts and they allow management to identify potential candidates.

Network groups also can serve as a mechanism for management to find out about problems in the workplace. But the company must be ready to respond to any concerns that members raise, Friedman said: “If they’re going to bring up issues, you’d better be able and willing to address them.”

Employers also may find that employees in network groups end up with new skills that can be applied at work. Members often develop leadership skills and learn how to run meetings and give presentations, he said.

Adopting a Policy

When adopting a policy on employee network groups, an employer has several decisions to make, Friedman said. For example:

  • Will you police the types of groups that form? Will you allow religious groups?
  • If you do allow religious groups, will you require that they have a business purpose, such as professional development? Will you require that they refrain from proselytizing? If so, how will you monitor that?
  • Will you prohibit groups from participating in political, commercial, or religious activities, or opposing any of the other approved groups? And again, how will you police that?
  • Will you maintain two separate group categories? (These could comprise “recognized organizations” that support diversity, and receive company funding, and “special interest organizations” for social, recreational, religious, or educational issues, which receive no funding.)

And don’t be afraid to ask for more information when you receive a network group proposal, Friedman said. For example: Who are they? Why are they forming? What will they do? You may not be able to anticipate every request, but with a solid policy and some follow-up questions, you should be able to set your network groups up for success.

Kate TornoneKate McGovern Tornone is an editor at BLR. She has almost 10 years’ experience covering a variety of employment law topics and currently writes for HR Daily Advisor and Before coming to BLR, she served as editor of Thompson Information Services’ ADA and FLSA publications, co-authored the Guide to the ADA Amendments Act, and published several special reports. She graduated from The Catholic University of America in Washington, D.C., with a B.A. in media studies.