Handshake Agreements in the Workplace

Handshake agreements in the workplace can lead to problems. This is one example of a breakdown of trust between an employee and a supervisor.

We have all heard of “handshake agreements”. A handshake agreement, which is usually oral, is based on trust in the existing relationship, as opposed to explicit written language.

When oral agreements are made between supervisors and employees, both sides believe they will be followed. Participants trust that if there are finer details of their agreement, they can easily be worked out later.

Breaking handshake agreements usually results in a breakdown of trust. Trust between supervisors and employees is usually based on a succession of handshake agreements. Each side in the employee-supervisor relationship comes to rely on the good faith of the other participant in a handshake agreement to live up to that agreement.

Unfortunately, sometimes when these type agreements are made, one side or the other may forget or fail to live up to the agreement. Very rarely do supervisors and employees enter into written contracts on workplace matters. They believe they can trust the other party to the agreement to live up to what has been agreed to.

Rarely are these oral agreements put in writing, but that does not make them any less valid in the eyes of the employee. When a supervisor agrees to an employee’s request, most employees believe that the agreement will be followed. Sometimes a supervisor will agree to an employee request only to later on for whatever reason find that they can live up to the agreement. This can lead to a loss of trust in the work place.

Case Study: The Forgotten Approval

Matt has just learned that his girlfriend Barbara has the week after Christmas off of work. He would also like to take that week off so that the two of them can take a trip to the Caribbean.

Although he has already accrued more than enough paid leave, he knows that a lot of his colleagues like to take that week off every year. Therefore, Matt approaches his supervisor, Ethan, in line at the cafeteria. Matt asks if he can take the week off, and Ethan immediately answers, “Sure, not a problem.”

From Matt’s experience, this is a typical approval from Ethan, so he doesn’t think to submit a written request as required by company policy. Later that evening, Matt buys non-refundable airline tickets for him and his girlfriend’s trip to Aruba. 

On December 1st, Matt finds his name assigned to tasks scheduled for the week after Christmas. He is livid and immediately meets with Ethan to tell him that he had been granted approval to go on vacation. Ethan responds that he never received a written request from Matt. When Matt tries to remind him of their oral agreement in the lunchroom, Ethan can’t seem to recall the conversation and defends himself by reminding Matt of the company policy for leave requests. Matt wonders if he will never be able to trust Ethan again. He can’t believe that Ethan is breaking his promise and relying on a policy that he has never followed in the past. 

When supervisors make oral commitments such as these to employees, they effectively enter into a handshake agreement. Ethan and Matt have found themselves in the midst of a credibility dispute in which one or more people believe that the other is a liar.

These scenarios are not uncommon in the workplace, and this particular dispute could be resolved in a number of ways: 

Option 1. Ethan can stick to his position, deny Matt leave for the week after Christmas and direct Matt to put all leave requests in writing in the future. 

Option 2. Ethan can grant Matt his leave, even if doing so might put a strain on the entire work unit. 

Option 3. Ethan can offer to cover any cancellation fees that Matt might incur when cancelling his trip.

Option 4. Ethan can ask if any employees scheduled for leave during that week would be willing to take a different week off instead. 

Option 5. Ethan can invite Matt to sit down and work on finding a solution together.

If you were Ethan and decided to focus on maintaining a trusting relationship with Matt, you would choose an option that would lead to a collaborative and mutually beneficial solution. If you were to focus on maintaining discipline and order in the workplace, then you would choose a solution that would emphasize your authority. If a dispute such as this one is not resolved, the resulting loss of trust can negatively impact employee productivity.

Supervisors should understand that when they agree to what an employee asks, as far as the employee is concerned, they can take it to the bank. While Ethan may not have purposely misled Matt, the effect of the later reversal of the agreement can have a detrimental effect on their relationship going forward.

While not required, it would have been a better practice for Matt to have confirmed the approval in writing by making a leave request. There can be considered to be fault on both sides for not following company policy, however, if Ethan has waived the need for a leave request in the past, it is harder for him rely on the existing policy. Wherever fault lies, they both need to acknowledge the effect this will have a on their relationship and work together to find a solution to the problem to be able to successfully work together in the future.

About the Author

Joe Swerdzewski, former General Counsel of the FLRA & owner of JSA LLC is the author of The Essential Guide to Federal Labor Relations, A Guide to Successful Federal Sector Collective Bargaining, etc. For more info on JSA’s services, email info@jsafed.com or subscribe to JSA’s newsletter.