13 December 2016 Trust me - I'm your employer

By Warwick Ryan, Partner

Coming into this season, we tend to reflect on the year that was and what matters most in our lives. For many of us, this will be nurturing healthy relationships.  Relationships founded on trust.

This year, I have made it my business to seek out and spend time with people who have built communities of trust within their organisation and to try to better understand why, happily (for them), they need to see employment lawyers so little.

A study of Buildcorp

I want to understand the components that produce high trust organisations that are, almost without exception, successful. Buildcorp is one such organisation.

In 1992, Tony Sukkar, along with hundreds of other employees, was made redundant by Girvan Bros when that company collapsed.

Rather than allowing themselves to be crushed by the experience, Tony and his wife Josephine built a construction business from the ground up. In the ensuing 20 plus years, Buildcorp has grown from humble beginnings to a second tier building company, now pushing for first tier work.  They are nudging half a billion dollars per year in revenue and employ hundreds of staff and even more subcontractors across the country.

And here is the interesting aspect of the business: the staff seem to want to stick around for decades.  Even more intriguing, they encourage their relatives to come and work for Buildcorp.

So I met with Josephine Sukkar, co-CEO, to seek out her insights on the company's journey and what has made it so successful.

After 1½ hours of traversing various topics, it came down to one simple element: Trust.

Trust is a product of an organisation having integrity – an organisation which simply acts in accordance with its stated values even when it is against its interests to do so and there is no apparent upside.

Josephine was adamant that if you treat people with respect, and you support them when they are showing the business respect, the product is both loyalty and employee engagement.

  • The limits of policies and processes

This confirmed my long-held view (see earlier blogs) that focussing on policies and processes without values and integrity does not deliver productivity in a workplace – perhaps just a business with a slightly more organised form of malice at its heart.

So why is integrity in your processes and values so important? Because if staff do not believe that fairness lies at the heart of the business process, they will not use it or adopt it or, worse still, they may use it as a tool to undermine a co-worker.

This disengaged or destructive culture becomes obvious in two ways, each of which will diminish the business's performance.

  • Condoning bad behaviour at the top

If leaders within an organisation are allowed to act in a way that is contrary to the organisation's stated values, then staff will cease to trust that organisation.  And if an employee ceases to trust their organisation, they are going to operate only within clear boundaries and will spend a good part of their time being seen to be doing the right thing (even when they are not) rather than actually thinking about what is in the business's interests and doing that thing.  They will also pick up the cue that it's okay to push someone else under a bus as long as you can dress it up as following a process.  So you end up with an organisation that not only tolerates bad behaviour but tacitly condones it.  It will never end well.

A friend recently shared an experience he had in the boardroom where the bombastic and erratic CEO was demeaning the CFO in a vicious manner in front of her colleagues, including the HR Manager. Interestingly, the HR Manager sat passively and watched this unfold without raising any form of protest.  Their combined behaviour sent the message to all those present that this was not an organisation which worked on merit, as it claimed, but an organisation being held hostage to the poor temper of the CEO.  Unsurprisingly, the organisation was floundering.

  • Ignoring bad behaviour at the coal face

 The other critical area which can be destroyed by process without integrity (and therefore no possibility of trust) is in the work of line managers.  What is it about the line manager's role that is so critical?  Put simply, line managers are the frontline people who deal with staff poor performance and misconduct on a day-to-day basis - or more importantly - don't! 

If a line manager, who works closely with the staff and gets to know them as people, does not feel that their organisation has integrity and does not trust management to fairly manage staff who misconduct themselves or are performing poorly, they will not notify management or HR of a problem before it becomes critical (usually when the opportunity for an effective response is long past).

If line managers do not report issues up the line, problems are likely to not only persist, but fester. Ultimately, this results in poor productivity, exposure of the company to work health and safety risk, increased sexual harassment incidents, dishonesty and bullying incidents.  Perversely, the long term toxicity of this behaviour often culminates in a worker's compensation claim by the offending employee when the same line manager, faced with outrageous behaviour one time too often, is pushed over the edge into expressing unrestrained and inappropriate anger and frustration towards that employee.

By the time the employment lawyer gets involved, there is a litany of poor behaviour that has persisted for a long time but is totally undocumented - the disciplinary options available to the company are limited. Conversely, the line manager's inappropriate response is likely to have caused such a stir that it is recorded in emails (if not an incident report) – and the company's hands are more or less tied in dealing with the beleaguered line manager…

So, the equation is simple:

Values + integrity + process = Trust = Productivity

It is appropriate to point out here that, as the equation indicates, having values without the procedures to back them up has its own disastrous outcomes – but that is for another article.

Back to Buildcorp

Much of Josephine and Tony's success in dealing with staff and encouraging a very positive and engaged environment, has been intuitive. In short they are decent people – but with an attention to process.  And that applies in their business.

That doesn't mean that they are pushovers, but it does mean that they will treat people with fairness and that there is consistency in their actions.

That's a pretty attractive proposition if you're a highly skilled person looking to build a career - and it is a factor not overlooked by their clients.

As we move into this season of rest and reflection, are we brave enough to ask the question "Does our business operate with integrity?"  If it doesn't, how much better would it function if it was built on trust?


This article was first published as a LinkedIn blog. You can read it here.

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This article is not legal advice and the views and comments are of a general nature only. This article is not to be relied upon in substitution for detailed legal advice.

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