General Counsel have a lot on their plates today. These complex challenges go far beyond traditional legal issues: data privacy and cybersecurity, Artificial Intelligence, ESG, antitrust, shareholder activism, corporate governance, and much more. One issue rising to the top of that list of risks is one many General Counsel haven’t had to deal with historically: labor relations risk.

In today’s labor landscape, companies must remain vigilant and proactive to manage employee relations effectively. A reactive approach, responding only when issues arise, is no longer sufficient. General Counsel must lead their organizations in adopting a "left of boom" approach—a proactive strategy designed to anticipate, address, and mitigate labor-related challenges before they escalate into larger problems.

The "Left of Boom" Strategy: Staying Ahead of Crises

The phrase "left of boom" refers to acting before a crisis (the "boom") occurs. A company focused on staying left of boom identifies vulnerabilities, engages employees proactively, and takes early actions to avoid labor disruptions. General Counsel must instill this mentality across leadership to ensure that labor relations are not a last-minute scramble but an ongoing commitment to fostering a healthy workplace culture.

Key components of this approach include:

• Identifying vulnerabilities early: Counsel should encourage their organizations to assess internal and external risks related to labor issues. This includes evaluating employee engagement, union presence, and workplace culture. By maintaining a constant pulse on these elements, companies can spot potential labor conflicts before they become major issues.

• Training supervisors: Supervisors are often the first line of defense in labor relations. Their ability to detect and address early warning signs, such as changes in employee mood, disengagement, or rumors, is crucial. Leadership should be trained to be approachable and recognize when small issues may become larger concerns.

Why Many Labor Strategies Fail

Many companies fail at labor relations because they do not focus enough on fostering a strong, direct relationship with employees. These failures often stem from inconsistent communication, unapproachable leaders, and poor risk assessment. Failing to "run to the smoke"—or address issues immediately when they arise—leads to situations spiraling out of control.

For example, new hire orientation and training are often missed opportunities. Instead of fostering loyalty and embedding the company’s values, these processes are often rushed or disjointed. General Counsel should seek reassurance from HR leaders that these touchpoints are used effectively to communicate the company's direct relationship philosophy and set clear expectations about the labor environment, including the company's stance on unions.

Building a Culture That Reduces Labor Vulnerability

One of the best ways to minimize labor relations problems is to create a culture where employees feel valued, respected, and engaged. Many General Counsel don’t see how a focus on culture impacts legal risk. However, employees who fit the company's culture and are motivated by the company’s mission are much less likely to create or ignore legal issues. Here are some strategies General Counsel can implement to foster a positive culture:

1.    Ensure the business hires and onboards effectively: Ensure that the hiring process lawfully screens for individuals who align with the company’s values. Use onboarding to communicate the company’s goals, values, and expectations transparently. Avoid overselling the job to prevent “buyer’s remorse,” which can lead to disengagement and disappointment down the road. Instead, be transparent and set clear expectations.

2.    Ensure the business fosters open communication: Lack of communication also creates legal risk. Communication not only reduces misunderstandings that can spiral into “boom” events but also can be helpful evidence in future litigation. Multi-channel communication is critical. Use various platforms such as 1:1 meetings, email, text, and employee feedback channels to ensure that no one feels out of the loop. Leadership must over-communicate important messages, as research shows that employees need to hear a message multiple times before it truly resonates.

3.    Measure and promote “net promoter” culture: Employee net promoter score (eNPS) is a key indicator of whether employees will recommend the company to others. General Counsel aren’t drivers of employee engagement. Nevertheless, changes in this metric are a leading indicator of employee relations legal risk. Positive employee sentiment increases engagement and reduces the chances of employment litigation and potential labor unrest.

Proactive Employee Engagement: The Frontline of Labor Relations

Employee engagement is critical for fostering a positive work environment that reduces the likelihood of employment litigation and unionization efforts. General Counsel should encourage their businesses to focus on creating programs and systems that empower employees and make them feel heard. This includes involving employees in decision-making processes whenever possible, which increases their sense of ownership and connection to the company.

Most important is making sure the business focuses heavily on training supervisors to detect subtle changes in employee behavior, such as tension, disengagement, or reduced organizational citizenship. These are other leading indicators—now getting much closer to “boom”—that companies can lawfully investigate and address potential issues before they escalate. These early detection systems allow companies to stay left of boom and avoid costly litigation and labor disputes.

Preparing for the Right of Boom: If Problems Arise

Despite best efforts, some labor issues may still arise. It is important that General Counsel make sure the business has a plan in place for when they cross over to “right of boom”—the point at which an issue has escalated. This includes:

• Response tools: Developing a communication plan and a response team for when labor disputes occur. These teams should be prepared to manage campaigns, respond to employee concerns, and mitigate the spread of misinformation.

• Bargaining strategies: In the event of unionization efforts or labor disputes, companies must have a well-developed bargaining strategy. General Counsel should prepare for negotiations by training a team that can lead these discussions effectively.

• Strike preparation: While rare, companies should always be prepared for the possibility of a strike. This includes having contingency plans in place to ensure business continuity.

 Conclusion: Proactivity as a Long-Term Investment

Proactive labor relations are not a one-time fix but an ongoing commitment. General Counsel must lead the charge in building a culture that values transparency, communication, and employee engagement. By staying left of boom and addressing issues before they escalate, companies can avoid the pitfalls of labor disputes and foster a more resilient and loyal workforce. The strategies outlined above provide a roadmap for maintaining positive labor relations in today’s ever-changing environment.