Like Them or Not, Online Employer Reviews Have Power

Like Them or Not, Online Employer Reviews Have Power

Many employers are understandably wary of sites like Glassdoor that allow employees and job candidates to publicly post anonymous reviews of their current or prospective employer, which can create tension between employees’ free speech rights and employers’ rights to be protected against costly defamation. In the age of social media, however, managers who would hope to put a lid on this pot are probably fighting a losing battle, and it is becoming increasingly important for organizations to pay attention to how online reviews affect their employer brand. Last week, CIO’s Sharon Florentine highlighted a recent survey from Future Workplace and CareerArc exploring the influence of online reviews on job candidates’ perceptions of an employer. Candidates are more likely than ever to research a prospective employer online before applying, the survey found, and are making more decisions based on those reviews:

[J]ob seekers increasingly trust reviews from other candidates and current employees to give them the lay of the land before applying. One in three job seekers has shared at least one negative review of a previous or prospective employer, and 55 percent of job seekers who have read a negative review have decided against applying for a position at that company, according to the survey. The survey also found that those employees and job seekers who do leave online negative reviews are 66 percent more likely to spread those opinions on social media, compared to those who only share their opinions directly with a friend or colleague.

And job seekers give more weight to the opinions of their fellow candidates and employees than a company’s official stance. The survey showed that job seekers rank current employees as the most trusted source for information about a company, followed by online reviews from job applicants and former employees, respectively. The CEO or other company executives were ranked the least trusted source by job seekers.

Another reason it’s worth employers’ while to pay attention to online reviews is that they can be a leading indicator of culture problems within the organization. Corinne Purtill at Quartz flags a fascinating study finding that reviews can even predict whether a company is likely to be investigated for fraud:

A team of researchers from the Hong Kong Polytechnic University and George Washington University studied feedback that 1.1 million employees of some 4,000 companies left on the job site GlassDoor between 2008 and 2015, and found that the lower these employees rated a firm’s “culture and values,” and their own job satisfaction, the more likely the company was to be the subject of a Securities and Exchange Commission fraud investigation or a securities fraud class action lawsuit.

Job satisfaction and culture/values rankings dropped consistently in the year a fraud investigation or action happened, as well as in the year before. As the researchers see it, these numbers tell a story in which managers push employees to reach unrealistic targets, leading to a dissatisfied workforce. And if the managers aren’t doing a good job of motivating employees—which they’re probably not, given that the employees are unhappy—and can’t hit their targets in legitimate ways, they may resort to fudging the numbers instead.