Favouritism at Work – When Relationships Override Performance

When Being Liked Matters More Than Being Good

Every workplace runs on relationships. Trust, familiarity and personal loyalty help colleagues communicate, cooperate and solve problems quickly, and few organisations could function without them. Difficulties begin when being liked becomes more valuable than being capable. When managers consistently favour particular employees, professional achievement starts to lose its meaning, and people who work diligently, demonstrate competence and accept responsibility may discover that their contribution counts for less than their proximity to influential decision-makers.

Favouritism rarely announces itself through formal policies or openly discriminatory instructions. It usually arrives through small, apparently reasonable decisions: a preferred employee receives an attractive assignment, a repeated mistake is quietly overlooked, or a promotion goes to the candidate with the closest managerial connection. Individually, each may appear harmless. Collectively, they can build a culture in which personal relationships, rather than evidence of performance, increasingly determine who receives opportunities, recognition and protection from accountability.

The financial stakes are considerable. Research published by the Advisory, Conciliation and Arbitration Service (Acas) in 2021 estimated that workplace conflict costs United Kingdom (UK) employers around £28.5 billion every year, equivalent to just over £1,000 for every employee. Those figures cover every source of conflict, not favouritism alone, but they show how expensive damaged employment relationships, unresolved grievances and declining confidence in management can become when problems are left to grow unchecked.

In procurement, supply chain and operational environments, the consequences reach well beyond individual dissatisfaction. Employees who believe that recognition depends on personal relationships become less willing to challenge supplier prices, propose improvements or volunteer for difficult work. Managers who shield preferred colleagues from reasonable scrutiny allow mistakes, inefficiency and underperformance to persist. What begins as a people management issue can quietly become a commercial weakness, a governance risk and, in some circumstances, a legal liability.

Effective leadership does not require managers to abandon personal relationships or treat every employee identically. It requires professional judgement, consistent standards and the willingness to recognise contribution on its merits. Fairness becomes questionable when a decision cannot be explained without reference to personal preference. Organisations that allow such practices to become embedded risk losing capable people, weakening trust and creating cultures where loyalty to individuals matters more than responsibility to the organisation.

What Constitutes Favouritism at Work?

Workplace favouritism occurs when a manager gives particular employees preferential treatment because of personal relationships, familiarity, loyalty or individual liking, rather than demonstrable performance, competence or legitimate business need. It can influence recruitment, promotion, workload, overtime, flexible working, discipline and access to senior leaders. Favouritism is not, in itself, unlawful in the UK, but persistent preferential treatment can undermine fairness, weaken accountability and create circumstances in which employment rights and statutory duties become directly relevant.

Favouritism must be distinguished from legitimate managerial discretion. A manager who gives additional responsibility to an employee with consistently strong results, specialist expertise or proven reliability is not necessarily acting unfairly. The question is whether the decision rests on reasonable, relevant and consistently applied criteria. Employees in different roles, with different capabilities or facing different circumstances, can justifiably be treated differently without that difference amounting to inappropriate personal preference or improper conduct.

The difficulty is that favouritism seldom appears in written policies or formal instructions. It emerges through repeated discretionary choices, private conversations, informal arrangements and unexplained exceptions. One employee consistently receives desirable assignments while another absorbs unpopular tasks; one mistake attracts criticism while an identical error passes without comment. Each choice may be individually defensible, yet the cumulative pattern can reveal significant inequality in how managers treat people doing comparable work to a comparable standard.

Perception matters almost as much as intent. Employees rarely see the full reasoning behind a decision, so they judge fairness by outcomes, consistency and the quality of explanation they receive. A manager who allocates work sensibly but never explains why can still create a reputation for favouritism. Conversely, a manager who documents criteria, invites challenge and applies the same expectations to everyone builds credibility that survives occasional disagreement about individual decisions.

Favouritism, Nepotism and Cronyism – Understanding the Differences

Although the terms are often used interchangeably, favouritism, nepotism and cronyism describe different forms of preferential treatment. Favouritism covers advantages based on personal liking or familiarity. Nepotism specifically involves preference for relatives or family connections. Cronyism concerns advancing friends, associates or established networks, sometimes regardless of competence. All three compromise decision-making when relationships outweigh transparent selection criteria, professional capability and legitimate operational requirements, and all three thrive on informal processes nobody independently scrutinises.

Employing relatives or maintaining friendships with colleagues is not inherently improper. Family businesses frequently employ several generations, and longstanding professional relationships can build trust and continuity. Problems arise when personal connections determine appointments, pay or advancement without proper assessment, particularly where decision-makers conceal an interest or bypass the procedures designed to protect fairness. The test is not whether a relationship exists, but whether it has been declared, managed and kept separate from the decision itself.

Public bodies face explicit statutory requirements. Section 10 of the Constitutional Reform and Governance Act 2010 requires selection for appointment to the Civil Service to be on merit, based on fair and open competition, while section 7 of the Local Government and Housing Act 1989 requires local authority appointments to be made on merit. The Seven Principles of Public Life add that office holders must decide impartially, fairly and on merit.

The Civil Service Commission shows why independent oversight matters. Its 2024–25 annual report recorded 56,194 appointments through fair and open competition alongside 234 breaches of its Recruitment Principles across 56 departments and organisations, of which 99 were serious and 135 technical. The Commission attributed much of the increase from 71 breaches the previous year to a more rigorous audit programme. Common failings included assessing candidates against unpublished criteria and using requirements that disadvantaged external applicants.

Complaint investigations told a similar story. Of nine complaints investigated, the Commission upheld four, involving the Department for Work and Pensions, the Home Office, Acas and the Ministry of Justice. Its findings included an unrecorded conflict of interest, failure to assess advertised criteria and departure from the published process. None established nepotism, but each shows how procedural lapses create openings for preferential treatment and give unsuccessful candidates reasonable grounds to question the competition’s fairness.

The Psychology of Favouritism – Why Managers Prefer Certain People

Favouritism is not always deliberate or dishonest. Managers naturally develop stronger relationships with employees they understand, trust or find easy to talk to, particularly under operational pressure. Familiarity bias makes established colleagues seem more dependable, while similarity attraction encourages positive judgements about people who share our background, attitudes or working style. Without conscious scrutiny, these ordinary human preferences gradually influence decisions that should rest on evidence, such as who leads the next important project.

Confirmation bias reinforces those preferences. Once a manager regards an employee as exceptionally reliable, they may explain away mistakes as bad luck, while the same failure by a less favoured colleague becomes proof of poor performance. The halo effect works in the same direction, allowing one admired quality, such as confidence in meetings, to colour judgements about unrelated competencies. These distortions persist where performance data is incomplete, and reviews lack independent challenge.

Similarity bias also operates across entire professions. The Sutton Trust’s Elitist Britain 2025 study found that 36% of people in leading UK roles attended private schools, compared with 7% of the population, and that 62% of senior judges had done so. These figures demonstrate substantial inequalities in educational representation among influential professional groups. They do not establish individual favouritism, but they raise important questions about access, recruitment pathways, social networks and the criteria organisations use to identify leadership potential.

The strongest safeguard is not eliminating professional relationships, which would be both unrealistic and counterproductive, but understanding how judgements form. Managers should separate personal confidence in someone from demonstrated competence, ask whether comparable employees receive equivalent consideration, and actively seek evidence that challenges their established opinions. Objective criteria, documented reasoning and constructive challenge from colleagues ensure that familiarity remains a useful source of operational knowledge rather than an unearned advantage for those close to power.

The Inner Circle – When Access to Management Becomes an Advantage

In many organisations, informal groups form around influential managers, long-serving employees and individuals with regular access to senior leaders. Such relationships can be entirely legitimate, providing valuable communication channels and professional support. Difficulties arise when membership effectively determines who receives important information, strategic assignments or opportunities for advancement. Employees outside the group can find themselves excluded from discussions that directly affect their responsibilities, their workload and the direction of their future careers within the organisation.

Access to information is especially valuable in procurement and supply chain management, where early knowledge of forthcoming tenders, restructuring, contract renewals or management vacancies can confer real advantage. An employee who learns about a planned project weeks before colleagues has more time to express interest, build relevant skills and cultivate decision-makers. Even without any deliberate favouritism, unequal access to information shapes who appears best prepared when opportunities are eventually announced to the wider team.

The inner circle also shapes managerial perceptions through informal conversation. Employees who attend the right meetings, accompany managers on site visits or join social activities become more visible than equally capable colleagues. People remember their achievements, while they explain away their mistakes. People working remotely, on night shifts or at outlying depots and housing estates have fewer chances to build comparable relationships, despite contributing just as much to service delivery, customer outcomes and operational performance.

The Civil Service People Survey 2025, which drew 343,961 responses across 102 organisations, provides useful context. Its inclusion and fair treatment theme scored 78% across the Civil Service, while learning and development scored only 56%. These broad measures do not capture informal managerial networks, but they show why organisations should test whether every employee receives comparable opportunities to participate, develop and influence decisions affecting their work.

Managers should recognise that visibility and competence are not interchangeable. The employee who speaks confidently in meetings may not deliver the strongest operational results, while a quieter colleague may possess exceptional technical knowledge and judgement. Fair management requires deliberate engagement beyond established relationships, ensuring that project opportunities, important information, and professional development are available through transparent arrangements rather than personal familiarity or physical proximity to influential individuals at the centre of the organisation.

The Unequal Distribution of Opportunities and Recognition

Favouritism becomes particularly damaging when access to desirable assignments and development depends on managerial preference. Employees notice when certain colleagues consistently receive prestigious projects, external training, overtime, flexible arrangements or the chance to represent their department. Meanwhile, equally capable individuals handle repetitive work without comparable recognition. Over time, these decisions shape professional experience, earnings and confidence, and they determine the evidence each person can present when competing for promotion or for other forms of advancement.

Consider a procurement team in which one officer repeatedly leads major contract negotiations while another processes routine purchase orders. Both may perform well, but the first accumulates commercial experience, senior exposure and a portfolio of achievements. When a category manager vacancy arises, that officer appears better qualified, partly because of opportunities previously allocated through personal preference. The advantage becomes self-reinforcing, compounding across successive appointments until the original preference is invisible and the gap appears merit-based.

Overtime and allowances turn preference into hard cash. Office for National Statistics (ONS) data shows median gross annual earnings for full-time employees reached £39,039 in April 2025. In an illustrative scenario, an employee given five extra overtime hours weekly at £20 per hour earns £5,200 a year before deductions, more than 13% of that median salary. Where such hours repeatedly flow to preferred individuals without operational justification, unfairness becomes a measurable financial grievance.

Transparent allocation reduces these risks without removing managerial flexibility. Training should reflect identified development needs, assignments should consider capability and operational priorities, and overtime should follow published rotas or defensible criteria. Where particular employees receive additional opportunities, managers should explain the reasons and periodically review distribution patterns across the team. Fairness does not require identical treatment, but it does require confidence that each decision is reasonable, consistent and genuinely connected to organisational requirements.

Performance Standards That Change Depending on the Individual

Few management behaviours destroy credibility faster than applying different standards to comparable employees without good reason. A favoured individual arrives late without challenge, misses deadlines without consequence or repeats mistakes that managers dismiss as understandable. Another employee committing similar errors receives formal criticism or closer supervision. Such inconsistency teaches everyone that workplace rules are negotiable, depending on personal relationships rather than professional expectations, published procedures or the genuine circumstances surrounding a particular incident.

The consequences are particularly serious in warehousing, logistics, repairs and maintenance, where attendance, productivity and safety procedures shape daily performance. A supervisor who overlooks repeated procedural failures by a preferred operative weakens standards across the whole workforce. Colleagues reasonably ask why they should comply with requirements that apparently do not apply universally. Where safety obligations are involved, selective enforcement can expose employees, residents and customers to avoidable harm and the organisation to enforcement action.

Some differences in treatment are entirely legitimate. Reasonable adjustments for disabled employees, variations in contractual terms, different levels of responsibility and relevant disciplinary history can all justify different responses. The Equality Act 2010 may require adjustments that produce different treatment to remove disadvantage linked to disability. Consistency therefore means applying the same principles to genuinely comparable circumstances, not identical outcomes regardless of individual needs, legal duties or the seriousness of incidents.

The Civil Service People Survey 2025 reported a median organisational benchmark of 8% for employees experiencing bullying or harassment during the preceding twelve months. Among those reporting such experiences, the median benchmark for being treated less favourably was 40%, compared with 53% for negative micromanagement and 38% for exclusion or marginalisation. These figures reflect workplace mistreatment more broadly than favouritism specifically, but they show the significance of perceived unequal treatment.

Managers should ensure that attendance expectations, performance measures, disciplinary processes and operational procedures are applied consistently, with legitimate differences explained and recorded at the time. Periodic reviews of warnings, ratings and exemptions across a team can reveal patterns that individual decisions conceal. Employees do not expect managers to agree with every complaint, but they are entitled to reasonable, evidence-based decisions rather than unexplained personal preference or standards that shift depending on who is involved.

Promotions, Appointments and Rewards – When Merit Takes Second Place

Recruitment and promotion are among the most consequential opportunities for favouritism because they shape earnings, authority and long-term careers. When personal relationships outweigh competence, organisations risk appointing people who lack the judgement, experience or leadership ability the role requires. Equally damaging is the message to unsuccessful candidates: that achievement matters less than familiarity with decision-makers. Capable employees then begin to question whether continued effort will ever translate into meaningful advancement within the organisation.

Royal Mail Group Limited v Efobi illustrates the limits of the law. Mr Efobi, a postman with computing qualifications, applied unsuccessfully for more than 30 internal management and technology roles and alleged race discrimination. In July 2021, the Supreme Court dismissed his appeal, clarifying the burden of proof in discrimination claims. An unfair or poorly explained recruitment decision is not automatically unlawful unless it meets the statutory requirements, including a link to a protected characteristic.

The distinction matters because an appointment influenced by friendship can be unfair without amounting to discrimination under the Equality Act 2010. Liability depends on the statutory tests and the evidence, including whether treatment relates to a protected characteristic or another recognised claim. Even so, appointing managers through informal preference creates real organisational risk. It weakens leadership capability, discourages internal competition and undermines confidence in every subsequent performance, pay and disciplinary decision those managers make.

Public appointments demonstrate how procedural failures attract legal scrutiny. In February 2022, the High Court found that the Secretary of State for Health and Social Care had failed to comply with the public sector equality duty in the processes leading to the appointments of Baroness Harding and Mike Coupe. The court did not establish that open competition was legally required or that either individual lacked competence. The judgment reinforces the importance of satisfying applicable statutory duties when making senior appointments.

Discretionary pay carries comparable risks. In an illustrative scenario, an employee awarded an extra £3,000 annual increase through preference earns £15,000 more over five years than a comparable colleague, before pension effects. Birmingham City Council shows how unequal discretionary payments escalate. Equal pay claims, historically centred on bonuses paid in male-dominated roles such as refuse collection, contributed to an estimated £650 million to £760 million liability cited in its September 2023 section 114 notice.

Pay differences between individuals are not automatically unlawful, and most favouritism disputes will never resemble Birmingham’s scale. However, unexplained variations invite legitimate questions about fairness and, where they correlate with sex or another protected characteristic, legal challenge. Structured assessment, independent moderation, published pay principles and documented reasons for every discretionary award are the essential safeguards. An organisation unable to explain why two comparable employees are paid differently is poorly placed to defend that difference.

The Favoured Employee – Privilege Without Accountability

Preferential treatment can harm the favoured employee as well as the colleagues who miss out. Individuals repeatedly protected from criticism may develop an inflated view of their own competence, particularly when managers overlook mistakes or provide disproportionately positive appraisals. Without honest feedback, weaknesses remain unresolved and development stalls. The employee may then struggle when transferred to another team or when a new manager arrives, and normal expectations apply for the first time.

The situation becomes problematic when preferred employees assume that their relationship with management offers protection. They may resist instructions from other supervisors, dismiss colleagues’ concerns or expect exemptions from established procedures. This rarely begins as deliberate arrogance; it develops through repeated managerial signals that different standards apply. Over time, entitlement replaces accountability, and colleagues grow increasingly reluctant to challenge behaviour they believe management will defend, whatever the merits of the concern they wish to raise.

In operational teams, the cost is measurable. In an illustrative scenario, a distribution operative’s repeated picking errors require two additional hours of corrective work each week at a labour cost of £18 per hour. Over 52 weeks, that amounts to £1,872, before delivery failures, customer complaints and inventory discrepancies are considered. If a manager ignores the errors out of personal loyalty, the avoidable cost simply continues year after year without anyone formally recognising it.

Favoured employees also face pressure to preserve their position. A manager may expect personal loyalty, unquestioning agreement or unusual availability in return for preferential treatment, and the relationship can become uncomfortable when professional boundaries blur or disagreement threatens access to opportunities. Responsible managers therefore provide consistent feedback, maintain appropriate professional distance, and ensure employees succeed because of demonstrable contribution, so success remains secure rather than dependent on one individual’s continued approval.

The Erosion of Trust – When Employees Stop Believing in Fairness

Trust depends on employees believing that decisions are made honestly, consistently and for defensible reasons. Repeated favouritism undermines that belief, particularly when managers justify decisions using performance criteria that appear to be applied selectively. Employees begin to wonder whether appraisals, promotions and disciplinary processes are genuine assessments or exercises designed to justify predetermined outcomes. Once that perception takes hold, even entirely legitimate decisions attract suspicion, resistance and informal complaint among the wider workforce.

The damage spreads beyond individual managers to Human Resources (HR), grievance procedures and senior leadership. The Civil Service People Survey 2025 recorded a leadership and managing change score of just 50%, and 19% of respondents intended to leave within a year or as soon as possible. Among those planning to go, 30% cited poor leadership and 29% cited organisational culture. These measures do not prove favouritism, but show how strongly confidence in leadership shapes retention.

Silence should never be mistaken for satisfaction. Employees who believe influential colleagues enjoy protection often conclude that raising concerns offers little benefit and could damage their prospects. In procurement and supply chain teams, declining trust shows up as fewer suggestions, less open challenge and withheld discretionary effort. Restoring confidence requires visible consistency, transparent reasoning and a demonstrated willingness to confront preferential treatment wherever it occurs, regardless of the seniority or popularity of the individuals involved.

Employee Morale, Motivation and Discretionary Effort

Morale depends heavily on the belief that commitment, competence and achievement will be recognised. When managers consistently favour particular individuals, the link between effort and reward becomes uncertain. Employees may continue to meet their contractual obligations while quietly withdrawing the enthusiasm, initiative and cooperation that drive organisational success. Because attendance and basic output may remain satisfactory, the loss of discretionary effort is easy to miss until it appears in missed savings and slower delivery.

The Chartered Institute of Personnel and Development (CIPD) Good Work Index 2025, based on a survey of 5,017 UK employees, found line management improving but uneven. Of employees with a line manager, 63% said their manager helped them perform well, up from 58% in 2023, and 64% said their manager got people working together successfully, up from 59%. Nevertheless, more than a third of respondents did not give a positive assessment of their manager's contribution to their performance.

The wider engagement picture is sobering. Gallup’s State of the Global Workplace 2026 report, using data collected throughout 2025, estimated that only 10% of UK employees were engaged at work, compared with 12% across Europe and 20% globally. Gallup also found that 46% of UK employees had experienced a lot of stress during the previous day. Many influences shape those figures, but perceived unfairness in management is one that organisations can directly control.

Within procurement teams, discretionary effort often determines whether employees merely process transactions or actively pursue better commercial outcomes. An officer who spots a potential £25,000 annual saving must choose whether to investigate alternatives, challenge specifications and persuade sceptical stakeholders. Repeatedly seeing favoured colleagues receive disproportionate recognition can discourage that initiative.

When successful contributions are routinely credited to favoured colleagues, employees reasonably conclude that exceeding expectations brings little personal or professional benefit, and the organisation quietly loses the savings.

Motivation therefore depends on more than pay or formal appraisal. Employees want confidence that their contribution matters, that opportunities are allocated reasonably and that their professional opinions receive fair consideration. Restoring morale requires consistent recognition, transparent decisions and genuine engagement with people outside established managerial relationships. The aim is an environment where credible management practice encourages additional effort across the whole team, rather than one where extra effort is selectively rewarded according to personal preference.

Resentment, Workplace Division and the Breakdown of Teamwork

Favouritism can gradually divide effective teams into informal insider and outsider groups. Employees who receive favourable treatment become associated with management, while colleagues feel disadvantaged regardless of performance. These divisions need not involve open hostility to cause damage. Repeated differences in workload, recognition, flexibility or accountability breed resentment, encouraging employees to interpret even routine decisions through an increasingly adversarial lens and to assume the worst about management motives and colleagues’ loyalties.

The scale of workplace conflict in Britain shows why resentment matters. The Acas research estimated that around 9.7 million employees experienced conflict at work in a single year, and that roughly 874,000 took sickness absence as a result, with many more leaving altogether. Conflict has many causes, and the research did not isolate favouritism, but perceived unfairness is precisely the kind of persistent irritant that turns ordinary disagreement into lasting division between colleagues.

The effects are particularly visible in supply chain operations, where performance depends on cooperation between procurement, warehousing, transport planning and customer service. If employees believe certain colleagues enjoy unjustified privileges, they become less willing to share information, cover absences or help with urgent problems. A warehouse team divided by managerial preference suffers avoidable delays, misunderstandings and a reluctance to resolve difficulties collaboratively, all of which eventually reach customers and residents as poorer service.

Preventing division requires managers to address underlying perceptions rather than dismissing complaints as jealousy or personality clashes. Employees should understand how responsibilities, recognition and development opportunities are allocated, and disagreements should be tested against objective evidence. Managers must also avoid allowing preferred employees to become unofficial gatekeepers between leadership and the wider workforce. Effective teamwork depends on mutual respect and confidence that everyone, regardless of their relationships, operates under the same fair expectations.

The Silent Withdrawal – When Good Employees Stop Contributing

One of the least visible consequences of favouritism is the gradual withdrawal of capable employees who stay but reduce their involvement. Unlike an openly dissatisfied colleague, the withdrawn employee continues to arrive on time, meet essential requirements and behave professionally. However, voluntary contributions diminish as they conclude that extra effort, shared expertise or proposed improvements will make no difference to recognition, responsibility or future career opportunities, however valuable those contributions might be.

This matters because organisations depend on knowledge that employees are not contractually obliged to volunteer. Experienced buyers understand supplier vulnerabilities, historic pricing arrangements and opportunities to improve specifications. Warehouse staff recognise inefficient stock movements, while transport planners see recurring delivery failures. Repairs operatives know which properties generate repeat visits and why. When such people withdraw from constructive discussion, management loses valuable operational intelligence without necessarily noticing anything has changed.

Gallup’s UK data adds a further dimension. Alongside the 10% of employees classed as engaged, about 7% were actively disengaged, leaving the large majority in the middle category: people who are present but not psychologically committed to their work. That middle group is where silent withdrawal lives. An employee who already feels overlooked becomes especially reluctant to take on additional responsibility when workloads are heavy, and the prospects for recognition seem limited.

Silent withdrawal can also distort managerial assessments. A previously enthusiastic employee may be described as lacking ambition, showing limited leadership potential or failing to contribute ideas, without anyone asking why their behaviour changed. If managers treat disengagement purely as an individual performance problem, they risk reinforcing the very conditions that caused it. Good management means noticing changes in behaviour, offering opportunities for confidential conversation and being willing to examine the organisational causes behind them.

Reversing withdrawal requires more than occasional praise or encouragement to participate. Employees need evidence that suggestions are considered fairly, that they can raise concerns without disadvantage, and that opportunities are genuinely open to them. Managers should review whether they have overlooked important contributions and whether established relationships influence who receives attention. Sustained improvement in transparency and recognition can bring people back into active contribution, although rebuilding damaged confidence usually takes considerably longer than losing it.

Losing the Best People – Favouritism and Employee Retention

Persistent favouritism encourages capable employees to leave organisations where advancement appears to depend on relationships rather than performance. High performers typically possess transferable expertise, established networks and commercial knowledge that competitors value highly. When repeated experience undermines confidence in managerial fairness, loyalty offers little advantage. The organisation can end up retaining those who benefit from preferential treatment while losing colleagues whose competence and experience are considerably harder and more expensive to replace.

The Acas research highlighted resignations as the single largest cost of workplace conflict. It estimated that around 485,800 employees resign each year because of conflict, with replacement and lost output costing employers approximately £14.9 billion. Those resignations reflect many causes beyond favouritism, but the figures show that when workplace relationships break down, the most expensive consequence is often losing people the organisation would have preferred to keep.

Replacing an experienced employee involves far more than advertising a vacancy. In an illustrative scenario, a procurement specialist earning £45,000 leaves and the replacement process generates £4,000 in recruitment costs, £3,000 in temporary cover and £5,000 in lost productivity during induction. The total of £12,000 excludes harder-to-measure losses, such as disrupted supplier relationships, delayed negotiations and the additional pressure placed on colleagues who absorb the workload while the vacancy remains unfilled.

The greatest losses often arise from knowledge that cannot be captured in written procedures. Experienced employees understand organisational history, stakeholder expectations, contractual weaknesses and the practical consequences of earlier decisions. Where favouritism repeatedly drives capable colleagues elsewhere, succession planning suffers and reliance on less experienced replacements grows. Effective retention therefore requires credible progression routes, fair performance assessment and managerial accountability for any unexplained pattern of departures from particular teams or from under particular managers.

The Impact on Employee Wellbeing and Psychological Safety

Favouritism affects wellbeing by creating uncertainty about expectations, recognition and professional security. Employees who face inconsistent criticism or repeated exclusion become anxious about decisions they cannot predict or influence. Those outside preferred groups may feel isolated, particularly when their concerns are dismissed, or colleagues hesitate to support them for fear of attracting the same treatment. Over time, these experiences can contribute to stress, reduced confidence and steadily deteriorating relationships throughout the wider team.

The Health and Safety Executive (HSE) estimated that 964,000 workers in Great Britain suffered work-related stress, depression or anxiety in 2024/25, accounting for around 22.1 million lost working days. Across all workplace injuries and new cases of work-related ill health, HSE put the annual economic cost at £22.9 billion, a three-year average labelled 2023/24. These figures span numerous causes and cannot be attributed to any single factor, but they show the scale of work-related psychological harm.

Absence data points in the same direction. The CIPD’s 2025 Health and Wellbeing at Work research, which surveyed HR professionals about their organisations, found average sickness absence had risen to 9.4 days per employee per year, compared with 7.8 days in 2023. Mental ill health remained the leading cause of long-term absence, and stress featured prominently in both short-term and long-term absence across the organisations surveyed by the CIPD.

Psychological safety matters most where employees must raise concerns, admit mistakes or challenge decisions that create operational risk. A procurement officer who fears that questioning a favoured colleague will damage their career may stay silent about questionable contract management. A warehouse operative may hesitate to report repeated procedural breaches if the person responsible enjoys close managerial protection. In both cases, favouritism allows avoidable safety, quality and financial problems to continue until they become serious incidents.

Managers strengthen psychological safety by responding consistently to concerns, separating professional disagreement from personal relationships and demonstrating that everyone receives fair consideration. Confidential reporting routes, respectful communication and impartial investigations are important safeguards. Equally important is recognising that seemingly minor inconsistencies can cumulatively affect how safe people feel. Employees speak openly only when they trust that challenging a decision, or a favoured colleague, will not automatically place them at a disadvantage in future decisions.

When Personal Loyalty Replaces Objective Assessment

Personal loyalty becomes a serious weakness when it replaces independent assessment of competence and judgement. Managers may repeatedly consult the same trusted colleagues because familiarity provides reassurance. Established trust can support efficient decisions, but overreliance on preferred individuals risks overlooking contrary evidence, excluding alternative expertise, and mistaking agreement for sound judgement. Decisions then become less rigorous at precisely the moment when rigorous challenge is most needed, such as during major contract awards or restructures.

The opposite distortion is equally dangerous: hostility can corrupt an apparently objective process. In Royal Mail Group Limited v Jhuti, decided by the Supreme Court in November 2019, a line manager responded to Ms Jhuti’s protected disclosures by creating a false picture of inadequate performance. A different manager, unaware of the truth, dismissed her in good faith for poor performance. The Supreme Court held that the hidden reason, her whistleblowing, was the real reason.

The judgment has a clear lesson for organisations relying on line managers’ assessments. Where a person in the management hierarchy manipulates evidence, an independent decision-maker acting honestly will not necessarily protect the employer, and the organisation may be held responsible for the manipulated reason. Although the Supreme Court regarded the circumstances as exceptional, the judgment illustrates the risks of relying upon manipulated performance evidence. Its legal ruling concerned identifying the real reason for dismissal, rather than establishing a general rule governing every appraisal, promotion or remuneration decision influenced by personal relationships.

Effective managers distinguish trusted relationships from reliable evidence and actively encourage informed disagreement, particularly where decisions involve substantial expenditure, safety or reputation. Independent performance assessment, documented decision criteria and regular challenge from colleagues outside established networks all reduce the influence of personal loyalty and personal antipathy alike. Professional relationships should support communication and accountability, not become mechanisms for defending poor decisions, concealing weaknesses or excluding perspectives that would improve the quality of the final decision.

The Cost of Incompetence – When Underperformance Is Protected

Protecting underperforming employees because of personal relationships creates costs that extend well beyond individual mistakes. Repeated errors create corrective work, missed deadlines, extra supervision, and customer dissatisfaction. Where managers excuse these failures while challenging comparable mistakes by others, accountability weakens across the department. The financial consequences become substantial when avoidable inefficiency continues for months or years without effective intervention, structured support or any credible plan for genuine performance improvement.

Consider an illustrative scenario in which a purchasing administrator processes 1,000 transactions monthly with a 4% error rate, against an expected rate of 1%. The 30 additional errors each month require correction. At an assumed £25 per correction, the additional annual cost reaches £9,000, excluding supplier disputes, delayed deliveries and management time. Modest performance differences, once protected from scrutiny, can generate recurring costs far larger than the sums managers usually associate with underperformance.

The effects intensify when underperformance affects contract administration, supplier selection or inventory control. A favoured contract manager who repeatedly misses renewal and notice dates can expose an organisation to unfavourable automatic extensions or unnecessary expenditure. In warehousing, inaccurate stock records cause shortages, excess purchasing and avoidable handling. Managers who excuse such failures because of longstanding personal relationships quietly transfer the financial consequences to customers, residents, colleagues, taxpayers and shareholders, who never agreed to bear them.

Early action is usually cheaper and fairer. The Acas research found that conflict handled only through informal discussion cost around £1,941 per person on average, compared with £6,405 where it escalated into formal disciplinary or grievance procedures. Although the research did not isolate protected underperformance, it suggests that addressing performance problems promptly and informally, before relationships harden and formal processes begin, is likely to save money and goodwill.

Accountability should nevertheless remain constructive rather than punitive. Employees need appropriate training, reasonable workloads, effective supervision and a genuine opportunity to improve before capability concerns escalate. Managers must distinguish true underperformance from insufficient resources, unclear instructions or disability-related disadvantage requiring adjustment. The objective is consistent improvement supported by evidence, not automatic disciplinary action. Shielding individuals from legitimate feedback ultimately disadvantages everyone, including the employee who needed guidance to become effective in the role.

The Unfair Workload – When Reliable Employees Carry Everybody Else

Favouritism creates an uncomfortable paradox: capable employees receive ever more demanding workloads while less effective but personally favoured colleagues enjoy greater protection. Managers repeatedly assign urgent problems, complex negotiations or difficult customers to dependable individuals because they trust them to deliver. Although convenient, this becomes unfair when additional responsibility is not matched by recognition, development, support or reward, and when it continues indefinitely while others are never expected to raise their game.

The imbalance is often most pronounced during emergencies. Experienced buyers often resolve supplier failures, run urgent procurements, and support inexperienced colleagues while maintaining their normal workload. Meanwhile, employees with closer managerial relationships receive less demanding assignments. If workload distribution goes unchecked, the highest performers become exhausted. At the same time, colleagues who contribute less continue to receive favourable assessments, preferred shifts, and development opportunities that overloaded staff no longer have time to pursue.

The cost can be expressed in working time. In an illustrative scenario, a logistics coordinator regularly works six extra unpaid hours each week to cover colleagues’ unresolved tasks, totalling 276 hours over 46 working weeks. At an assumed employment cost of £25 per hour, that work has an equivalent labour value of £6,900 a year. This is not necessarily an additional cash expense, but it represents value extracted from one employee without recognition or reward.

Unpaid additional work can also raise legal questions. Depending on the circumstances, sustained extra hours may trigger contractual entitlements, the Working Time Regulations 1998 (including the 48-hour average weekly limit unless an individual has opted out), and, for lower-paid workers, the National Minimum Wage Act 1998 where unpaid time pushes average hourly pay below the statutory rate. Workload imbalance is therefore not merely a morale issue; it can become a compliance issue.

Favouritism in Procurement, Supply Chain and Operational Management

Procurement and supply chain functions are particularly exposed to the internal effects of favouritism because individual decisions influence expenditure, supplier relationships, operational continuity and service delivery. Preferential treatment may determine who manages valuable contracts, receives specialist training or secures promotion into influential positions. In warehouses and distribution centres, similar problems emerge through preferred shift patterns, inconsistent productivity expectations and selective enforcement of procedures that undermine efficiency and confidence in operational leadership.

Consider an illustrative private-sector scenario in which a procurement director gives a less experienced but well-liked colleague responsibility for a £5 million facilities contract. In contrast, the organisation does not consider a qualified specialist with directly relevant experience. The decision does not prove favouritism, and there may be sound development reasons. It does create a governance concern if the choice cannot be explained, supervision is not strengthened or delegated authority limits are stretched to accommodate it.

Effective operational governance therefore requires clear delegation limits, transparent allocation of responsibilities, conflict-of-interest declarations and decisions that someone independent could review and understand. Managers should ensure that personal relationships do not influence supplier assessments, contract approvals, disciplinary decisions or access to career opportunities. The objective is not to eliminate professional trust, but to show that decisions involving people, public money, and commercial commitments remain defensible, proportionate, and consistent with established requirements.

Supplier Favouritism and Improper Commercial Influence

Three related but distinct risks need to be separated. Employee favouritism concerns how managers treat staff. Supplier favouritism concerns how buyers treat bidders and contractors, for example by sharing information early, relaxing evaluation or steering work towards familiar providers. Improper commercial influence goes further, involving inducements, undisclosed interests or pressure from connected individuals. These risks can reinforce one another because a culture that tolerates internal favouritism may also be less effective at challenging preferential treatment of suppliers with influential personal connections.

The coronavirus pandemic provides the most prominent UK example. The Department of Health and Social Care (DHSC) operated a high-priority lane for Personal Protective Equipment (PPE) offers referred by ministers, officials and parliamentarians. The National Audit Office (NAO) reported in November 2020 that 47 of 493 suppliers processed through that lane obtained contracts, around one in ten, compared with 104 of 14,892 suppliers using ordinary channels, fewer than one in a hundred.

In January 2022 the High Court held that operating the high-priority lane breached the obligation of equal treatment under the procurement rules then in force, while accepting that the contracts examined in that case would probably have been awarded anyway given the extreme urgency. The NAO had also found that documentation of some referrals and decisions was incomplete. The case shows how preferential access, even under genuine emergency pressure, can breach procurement law.

A later case demonstrated the commercial consequences. Baroness Mone referred PPE Medpro to the high-priority lane in May 2020, and the company secured a contract for 25 million sterile gowns. In October 2025, Mrs Justice Cockerill ruled that PPE Medpro had breached contractual requirements concerning validated sterility and conformity marking. The High Court awarded approximately £122 million in damages, equivalent to the contract price, while rejecting additional storage costs. The judgment concerned contractual non-compliance, not favouritism.

Where favouritism shades into inducement, criminal law applies. The Bribery Act 2010 criminalises offering or accepting bribes, and section 7 creates corporate liability for failing to prevent bribery by associated persons, subject to an adequate procedures defence. Since 1 September 2025, the failure to prevent fraud offence under section 199 of the Economic Crime and Corporate Transparency Act 2023 has applied to large organisations meeting statutory size thresholds, subject to a reasonable procedures defence.

The practical response is to treat supplier favouritism and employee favouritism as connected governance risks. Buyers should record all pre-procurement contact with suppliers, apply evaluation criteria exactly as published, rotate evaluators where appropriate and escalate any approach from a connected individual. Organisations should also check whether the same managers who show favouritism internally hold delegated commercial authority, because personal preference in one domain frequently signals vulnerability in the other and justifies closer assurance testing.

Conflicts of Interest, Personal Relationships and Managerial Integrity

Personal relationships become governance concerns when they interfere with professional responsibilities or create reasonable doubt about impartiality. Managers may supervise relatives, appoint longstanding friends, line-manage a partner, or allocate desirable work to close associates. None of these situations is automatically improper, but an undisclosed interest compromises confidence in recruitment, pay and disciplinary decisions. The central question is whether personal connections are influencing outcomes that should be determined solely by legitimate organisational considerations.

For covered procurements, the Procurement Act 2023, in force since 24 February 2025, requires contracting authorities to take all reasonable steps to identify, and keep under review, actual and potential conflicts of interest. Section 81 defines interest broadly, including personal, professional and financial interests, whether direct or indirect, and treats anyone who influences a decision as acting in relation to the procurement. Section 82 then requires reasonable steps to prevent unfair supplier advantage or disadvantage.

Section 83 requires authorities to prepare and keep conflict assessments under review, recording identified conflicts and the steps taken to mitigate them. Where an authority is aware of circumstances likely to cause a reasonable person wrongly to believe that a conflict exists, the assessment must also record the steps taken to demonstrate that no such conflict exists. The Act applies in England, Wales and Northern Ireland, while devolved Scottish authorities generally follow Scotland’s separate regime.

Comparable principles apply in private organisations and housing associations, even where public procurement legislation does not govern their activities. A buyer whose relative works for a prospective supplier should declare the relationship and be excluded from relevant decisions where necessary to manage the conflict effectively. A senior manager selecting a personal friend for promotion should arrange independent assessment. Proper disclosure protects employees, decision-makers and the organisation by demonstrating that personal relationships have not displaced objective judgement.

The most effective controls are proportionate, not oppressive. Organisations should maintain accessible conflict-of-interest policies, require regular and event-driven declarations, establish independent approval routes and record the reasons supporting sensitive decisions. Senior managers must show that these requirements apply to directors and influential employees as rigorously as to everyone else. Integrity depends not only on avoiding misconduct but on transparency sufficient for others to understand why each decision was reasonable, impartial and commercially defensible.

When Favouritism Reaches Senior Management and the Boardroom

Favouritism becomes especially consequential when personal relationships influence executive appointments, succession planning, remuneration or the oversight of senior managers. At this level, preferential treatment affects strategic decisions worth millions of pounds, organisational reputation and long-term financial sustainability. Directors may become reluctant to challenge influential colleagues, particularly where professional relationships extend over many years, and independent judgement weakens as loyalty to individuals gradually outweighs accountability to the organisation and its stakeholders.

The Financial Reporting Council (FRC) UK Corporate Governance Code 2024 addresses these risks for companies within its scope. It applies to financial years beginning on or after 1 January 2025, with Provision 29 on internal controls following a year later. It emphasises independent judgement, succession and remuneration governance on a comply-or-explain basis. In financial services, the Financial Conduct Authority (FCA) introduced new rules effective from 1 September 2026, extending relevant conduct requirements in non-banking organisations to certain incidents of bullying, harassment and violence involving colleagues. Their application depends upon the regulatory scope, the necessary work-related connection and the circumstances of the conduct.

Richard Sharp’s resignation as chair of the British Broadcasting Corporation (BBC) shows how undisclosed relationships undermine senior appointments. An investigation by Adam Heppinstall, King’s Counsel, published on 28 April 2023, found that Mr Sharp had breached the Governance Code on Public Appointments by failing to disclose potential perceived conflicts, including his involvement in arrangements connected with an £800,000 loan facility for the then Prime Minister. Mr Sharp resigned that day, describing the breach as inadvertent.

Boards must recognise that appointing familiar colleagues is not inherently inappropriate, provided decisions remain independent, transparent and defensible. Appropriate safeguards include robust nomination procedures, genuinely independent non-executive directors, effective remuneration oversight and documented assessment of senior performance. Ultimately, good governance depends on a willingness to question influential individuals, confront uncomfortable evidence and ensure that personal loyalty never becomes a substitute for competence, integrity or accountability in the organisation’s most senior roles.

The Financial and Commercial Cost of Workplace Favouritism

Favouritism creates costs that frequently remain hidden within ordinary operating expenditure. Preferential treatment contributes to turnover, absence, recruitment difficulty, lower productivity, operational mistakes and workplace disputes. Individual incidents may appear insignificant, but their cumulative effects can be substantial. Organisations usually recognise the immediate cost of replacing an employee or resolving a grievance, yet overlook the wider financial consequences of damaged morale, diminished cooperation and management standards that vary from one employee to the next.

The Acas estimate of £28.5 billion a year, or around £1,028 per employee, remains the most comprehensive UK measure of the cost of conflict at work. Conflict-related sickness absence alone accounted for around £2.2 billion, with resignations the largest single component. For each individual involved in conflict, the average cost was about £2,939. These figures concern workplace conflict generally, not favouritism specifically, but they show where unresolved employment problems ultimately land on the balance sheet.

Consider an illustrative scenario in which a 20-person procurement department loses two experienced employees a year because of perceived favouritism. If each departure generates £5,000 in recruitment costs, £4,000 in temporary cover and £6,000 in lost productivity, the annual cost reaches £30,000, equivalent to roughly three-quarters of a median full-time salary. Grievances, investigations and operational errors would increase that figure. These assumptions are illustrative, not published benchmarks.

Litigation risk adds another layer. From 6 April 2026, the compensatory award for ordinary unfair dismissal is capped at £123,543 or 52 weeks’ pay, whichever is lower, and the Employment Rights Act 2025 removes both caps for dismissals with an effective date of termination on or after 1 January 2027. Compensation for discrimination claims under the Equality Act 2010 is not subject to the statutory compensatory award cap applicable to ordinary unfair dismissal claims. Legal fees, management time, and reputational damage add to any award a tribunal makes.

The commercial consequences extend beyond measurable expenditure. Employees who no longer believe performance determines recognition become reluctant to challenge supplier quotations, identify savings or assume additional responsibility. Inconsistent treatment weakens succession planning, leaving organisations dependent on favoured individuals whose competence has received too little scrutiny. Financial accountability therefore requires managers to examine patterns of turnover, performance and complaints, recognising that apparently inexpensive preferential decisions can generate considerable long-term costs that no budget line ever records.

Favouritism and UK Employment Law – When Unfair Becomes Unlawful

Favouritism is not automatically unlawful, even where employees consider particular decisions unfair. Managers generally retain discretion over responsibilities, recognition and appointments, subject to the employment contract and applicable legislation. Legal difficulty arises when preferential treatment involves prohibited discrimination, harassment, victimisation, breach of contract or other actionable conduct. Distinguishing poor management from unlawful behaviour is essential, because not every unreasonable decision gives an employee a viable claim before an employment tribunal.

Geography also matters. The Equality Act 2010 provides the principal framework for employment discrimination protection in England, Scotland and Wales. Northern Ireland operates under separate anti-discrimination legislation, including the Fair Employment and Treatment (Northern Ireland) Order 1998, and has its own employment rights legislation, principally the Employment Rights (Northern Ireland) Order 1996. Employers operating across the UK must therefore identify the applicable requirements rather than assuming identical statutory provisions govern every workplace.

The Equality Act 2010 recognises nine protected characteristics: age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex and sexual orientation. However, different statutory provisions apply to different characteristics and forms of discrimination. Section 19, concerning indirect discrimination, identifies eight relevant characteristics, excluding pregnancy and maternity, which is protected through separate provisions. Preferential treatment of one employee becomes unlawful where the resulting disadvantage to another meets the requirements of a recognised claim, for example where a manager consistently favours colleagues of one sex, age group or ethnicity for promotion.

Harassment requires separate consideration. Section 26 of the Equality Act 2010 covers unwanted conduct related to a relevant protected characteristic that has the purpose or effect of violating dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment. Its assessment considers the individual's perception, the circumstances and whether the effect is reasonable. The seven relevant characteristics exclude marriage and civil partnership, and pregnancy and maternity; separate provisions cover sexual harassment. Victimisation under section 27 protects individuals against detriment because of specified protected acts, including making discrimination allegations, giving evidence or supporting proceedings under the Act.

Positive action shows how good intentions can produce unlawful outcomes. In a judgment published in February 2019, an employment tribunal upheld Matthew Furlong’s discrimination claim against Cheshire Police. The tribunal found that the force treated 127 candidates as equally qualified, despite assessment evidence showing differences in performance, to apply the tie-break provisions in section 159 of the Equality Act 2010. Lawful positive action must satisfy every statutory condition, including genuinely equal qualification.

Serious or persistent favouritism could contribute to constructive dismissal where an employer’s conduct amounts to a fundamental breach of contract, potentially including breach of the implied duty of mutual trust and confidence, and the employee resigns in response without affirming the contract. The threshold is demanding. Under the Employment Rights Act 1996, employees in Great Britain generally need two years’ service to claim ordinary unfair dismissal, though automatically unfair claims, such as whistleblowing, need none.

The Employment Rights Act 2025 introduces significant changes in Great Britain, with different provisions commencing on different dates. Under commencement regulations made in May 2026, the ordinary qualifying period for unfair dismissal claims falls from two years to six months for dismissals with an effective termination date on or after 1 January 2027, subject to applicable exceptions. Northern Ireland retains separate employment legislation to which these changes do not apply.

Grievances, Complaints and the Fear of Speaking Out

Employees experiencing favouritism often hesitate to raise concerns because the responsible manager also controls their workload, appraisal, training and promotion prospects. Challenging preferential treatment can appear professionally risky, especially when the favoured individual is influential. Employees fear being labelled difficult, excluded from important assignments or subjected to closer scrutiny. Consequently, apparently harmonious workplaces can conceal substantial dissatisfaction that management is either unwilling or unable to recognise until resignations or formal claims arrive.

Ministry of Justice figures show the scale of formal employment disputes. Employment tribunals in England, Wales and Scotland received 50,704 single claims in 2025/26, up around 39% from the previous year, while the open caseload of single claims reached roughly 64,000 by March 2026. These figures cover every employment jurisdiction rather than favouritism, but they show why resolving legitimate concerns early is far preferable to defending them before a tribunal.

An effective grievance procedure gives employees a reasonable opportunity to explain their concerns, present evidence and receive impartial consideration. Managers named in a complaint should never control the investigation into their own conduct. The Acas Code of Practice on disciplinary and grievance procedures sets standards on fair handling, reasonable investigation, the right to be heard and appeals, and an unreasonable failure to follow it can lead a tribunal to adjust compensation by up to 25%.

Whistleblowing protection differs from ordinary grievances. Under the Employment Rights Act 1996, as amended by the Public Interest Disclosure Act 1998, qualifying disclosures of specified wrongdoing are protected against dismissal and detriment. A personal complaint about preferential treatment will not usually qualify unless the worker reasonably believes the disclosure is in the public interest and meets the other statutory conditions. Organisations should protect confidentiality where practicable without promising anonymity a fair investigation cannot deliver.

HR and Senior Leadership – Who Challenges the Favourites?

HR teams and senior leaders must challenge management practices that compromise fairness, accountability, or performance. That responsibility matters most where influential managers have longstanding relationships with preferred employees. HR professionals should examine complaints objectively rather than automatically defending existing decisions or accepting managerial explanations without scrutiny. A failure to exercise independent judgement allows preferential treatment to become embedded in culture, where it becomes progressively harder and more expensive to remove.

The CIPD Good Work Index 2025 offers a useful benchmark for that scrutiny. While 79% of employees with a line manager described their manager as supportive when they had a problem, only 64% said their manager supported their learning and development, up from 57% in 2023 but still well short of universal. The difference between personal support and development support highlights an important area for HR scrutiny, particularly where access to training, progression and recognition may be influenced by managerial preference.

Senior leaders must also accept that commercial success does not excuse poor people management. A procurement director delivering substantial savings may still create serious risk through preferential appointments, inconsistent discipline or the exclusion of capable colleagues. Similarly, a warehouse manager meeting productivity targets should not be immune from scrutiny where turnover, grievances or complaints point to management weakness. Performance assessment must consider both the outcomes achieved and the methods used to achieve them.

Practical oversight starts with data. HR should monitor recruitment, promotion, ratings, pay awards, disciplinary outcomes and departures by manager, team and protected characteristic, looking particularly for concerns that repeatedly involve the same individuals. Exit interviews conducted by someone outside the line, together with anonymous pulse surveys, often reveal patterns that individual grievances never surface. Regularly reporting these findings to senior leadership turns isolated anecdotes into evidence on which to act.

Ultimately, effective oversight requires organisational courage. Senior managers must be willing to question popular or commercially successful colleagues when their treatment of employees undermines established standards. HR, in turn, needs sufficient independence and seniority to escalate concerns without fear of being overruled by the very managers under scrutiny. Where that independence is absent, favouritism becomes self-protecting, because the people best placed to challenge it depend on the goodwill of those who benefit from it.

Why Equal Treatment Does Not Mean Identical Treatment

Fairness does not require every employee to receive identical responsibilities, opportunities or rewards. People bring different skills, experience, contractual arrangements and development needs, making some variation necessary and appropriate. A highly experienced procurement specialist may reasonably lead complex negotiations while an inexperienced colleague receives closer supervision. Differences become problematic only when decisions lack legitimate justification or when personal relationships override relevant professional considerations, leaving outcomes that cannot be explained by anything other than preference.

The Equality Act 2010 illustrates the point through the duty to make reasonable adjustments for disabled workers under section 20. Employers may need to modify working arrangements, equipment, duties or procedures to reduce disability-related disadvantage. Treating everyone identically can therefore itself be inappropriate, and in some circumstances unlawful. Acas guidance emphasises that adjustments should reflect individual needs, practical considerations and the employer’s circumstances, rather than any requirement for uniformity across the workforce.

Performance-based differentiation is equally legitimate where it reflects demonstrable achievement. An employee who consistently exceeds agreed objectives may receive greater responsibility, additional training, or accelerated progression without any favouritism. However, managers must ensure that assessment criteria are relevant, evidence-based and consistently applied. Rewarding performance becomes questionable when preferred employees are given the opportunities to demonstrate achievement while equally capable colleagues are repeatedly denied comparable exposure, stretch assignments or development.

This distinction matters in operational management, where shift allocations, overtime, and flexible working requests involve competing legitimate interests. Managers must weigh skills coverage, availability, contractual terms, health considerations and service demand. Fair decisions need not produce identical outcomes, but employees should understand the principles behind them. Published criteria, proportionate explanations, and regular reviews help prevent legitimate operational discretion from being mistaken for personal preference, and help identify genuine preference quickly.

Transparent Performance Management – Making Decisions Defensible

Transparent performance management is one of the strongest safeguards against favouritism because it requires managers to explain decisions through observable evidence rather than personal impressions. Clear objectives, measurable indicators and consistent review arrangements help distinguish genuine achievement from familiarity or loyalty. Employees should understand what good performance looks like in their role, how their contribution will be assessed, and which factors influence recognition, progression, or corrective action, so surprises at appraisal time become rare.

In procurement teams, relevant measures might include compliance with procurement rules, contract delivery, supplier performance, verified savings and the management of commercial risk. Warehouse assessments might consider inventory accuracy, productivity, safety compliance and order fulfilment. Numbers must still be interpreted intelligently, because outcomes depend on workload complexity, available resources and external conditions. Good performance management combines evidence with informed judgement rather than relying mechanically on isolated figures or arbitrary targets.

Feedback quality is the weak point in many organisations. The CIPD Good Work Index 2025 found that 62% of employees with a line manager received useful feedback on their work, meaning more than a third did not. Where feedback is sparse, ratings rest on impression rather than evidence, and impression is exactly where familiarity and favouritism exert their influence. Regular, specific and recorded feedback gives every employee the evidence on which later decisions will rest.

Performance Calibration – Testing Judgements Across Managers

Calibration is the practice of comparing performance assessments across managers, teams and reporting periods before ratings are finalised. Its purpose is simple: to test whether similar performance receives similar ratings, regardless of the line manager. A panel of peer managers, facilitated by HR or an independent senior colleague, reviews the distribution of ratings and the evidence behind them, challenges outliers, and agrees adjustments where judgements prove inconsistent with the documented evidence.

Calibration exposes several patterns that favouritism produces. One manager may award consistently higher ratings than peers to employees performing at comparable levels. Another may rate members of an informal inner circle well above colleagues delivering similar results. Ratings may drift upwards over successive years for some individuals without corresponding evidence. Comparing ratings against objective data, such as error rates, savings delivered or audit findings, quickly reveals assessments that rest on preference rather than performance.

The Jhuti judgment shows why calibration should examine the evidence base as well as the ratings. Where one manager controls the narrative about an employee’s performance, independent reviewers should ask whether the evidence was gathered fairly, whether the employee had an opportunity to respond, and whether the same standard was applied to colleagues. Calibration that merely accepts each manager’s account at face value provides false assurance rather than genuine protection.

Calibration must be designed carefully to avoid creating new unfairness. Forced distributions that require a fixed percentage of low ratings can penalise strong teams and generate disputes. Panels should include members who do not manage the employees concerned, record reasons for changes and monitor outcomes by protected characteristic to detect any disproportionate effect. Employees should know that calibration takes place, how it broadly works and how to raise concerns about outcomes.

Proportionality matters as well. A small housing association or local supplier does not need an elaborate annual moderation exercise; a structured conversation between two or three managers comparing ratings and evidence can achieve much of the benefit. Larger organisations may justify formal panels and audit sampling. In every case, the principle is the same: no single manager’s personal judgement should determine an employee’s rating, pay or progression without being tested against comparable decisions elsewhere.

Fair Recruitment, Promotion and Development Opportunities

Recruitment and promotion procedures should assess candidates on relevant competence, experience, qualifications and potential rather than familiarity with decision-makers. Published selection criteria, structured interviews with consistent questions and predefined scoring, independent panel members and well-designed practical exercises all reduce opportunities for preferential treatment. Organisations should also examine how candidates acquire the experience required for advancement, since unequal access to training and stretch assignments creates disadvantage long before any formal selection process begins.

The Civil Service Commission findings described earlier offer practical lessons for every sector. Among the breaches its audits most commonly identified were failures to assess candidates against the advertised criteria and the use of exclusionary requirements that disadvantage external applicants. The Commission rated six organisations, including the Animal and Plant Health Agency, as needing improvement, demonstrating that well-intentioned processes can still drift towards favouring established insiders.

Development planning deserves the same scrutiny as selection. An organisation may run an apparently impartial promotion process while repeatedly allocating high-profile projects to preferred employees, who then appear more experienced because managers previously controlled their access to relevant work. Fair recruitment therefore begins well before vacancies arise, through transparent development planning, open expressions of interest for acting-up and project roles, and regular review of whether personal relationships are shaping access to experience.

Informal recruitment routes require particular care. Employee referral schemes, direct approaches and appointments made without advertisement can be efficient and lawful, but they draw candidates from existing networks and tend to reproduce the current workforce’s profile. Where organisations use these routes, they should record why they did not use open competition, apply the same assessment standards to every candidate, and monitor outcomes so convenience does not quietly become a mechanism for cronyism.

Holding Managers Accountable for Consistent Standards

Managers should be assessed not only on financial and operational results but on their ability to maintain fair, consistent and defensible people management. Senior leaders must set clear expectations for recruitment, workload allocation, performance management and development. Where repeated complaints or unexplained differences suggest preferential treatment, those concerns deserve proper scrutiny regardless of the manager’s seniority, reputation or commercial track record, and regardless of how inconvenient that scrutiny may be for the organisation.

Accountability matters most where managers hold considerable discretion over careers. A logistics director who consistently appoints personal associates, or a procurement manager who repeatedly shields preferred employees from legitimate criticism, should be required to explain the evidence supporting those decisions. Independent review can establish whether procedures were followed and whether comparable employees received reasonable consideration. Such scrutiny must remain evidence-based, avoiding any assumption of wrongdoing simply because a working relationship or friendship exists.

People management measures can be built into managerial performance reviews. Relevant indicators include staff turnover, internal promotion rates, access to development, substantiated grievances, calibration adjustments and the quality of recruitment records. These measures need careful interpretation, because high turnover or complaints do not in themselves prove favouritism. Effective oversight examines patterns, context and evidence together rather than relying on isolated statistics or simplistic assumptions about an individual manager’s performance or motives.

Senior leadership must also be prepared to intervene when commercially successful managers repeatedly show poor judgement about how they treat people. A £500,000 procurement saving does not justify discriminatory decisions, inappropriate preferential treatment, or protecting persistent underperformance. Organisations that reward financial outcomes while ignoring management behaviour send contradictory signals. Genuine accountability requires consistent consequences, constructive improvement plans and recognition that sustainable commercial success depends on competent, ethical and fair leadership.

Accountability also has a positive side. Managers who handle difficult allocation decisions transparently, develop people outside their immediate circle and act on calibration feedback should be recognised for doing so. Including fair people management in promotion criteria for managers signals that the organisation values how results are achieved, not just the results themselves. Over time, that recognition shapes aspiring managers' behaviour more powerfully than any written policy or set of corporate values.

Rebuilding Trust After Favouritism Has Become Entrenched

Restoring confidence where favouritism has become entrenched requires more than revised policies or general assurances about fairness. Employees who have repeatedly experienced inconsistent treatment will reasonably question whether management genuinely intends to change. Recovery begins with an objective assessment of the underlying problems: how decisions have been made, which employees have been disadvantaged and whether influential individuals have avoided appropriate accountability for decisions that colleagues considered unfair.

Independent review is often the right starting point, particularly where existing relationships compromise confidence in internal investigation. Reviewers should examine promotion histories, recruitment decisions, workload allocation, pay awards, disciplinary outcomes and access to development. Confidential employee feedback can reveal patterns that formal records miss, although allegations must be assessed fairly and without presuming misconduct. The aim is a reliable understanding of what happened before designing and implementing proportionate corrective measures.

Rebuilding confidence may also require acknowledging past shortcomings and explaining how future decisions will differ. Employees will not trust revised procedures if the same individuals continue to exercise unrestricted discretion without additional oversight. Transparent selection criteria, independent assessment, calibration and documented allocation arrangements demonstrate meaningful change. Organisations must, however, respect confidentiality and employment rights, particularly where investigations involve individual performance, disciplinary allegations or sensitive personal relationships between colleagues.

Trust ultimately returns through sustained consistency rather than isolated announcements. Employees need to see managers apply reasonable standards, recognise genuine achievement and respond appropriately to concerns involving influential colleagues. Progress can be tracked through confidential surveys, retention patterns, calibration outcomes and the credibility of grievance decisions. Recovery should be treated as an ongoing management responsibility, with regular scrutiny to ensure previous patterns of preferential treatment do not gradually reappear once attention moves elsewhere.

Creating a Merit-Based Culture Without Losing the Human Element

A merit-based culture recognises competence, effort, development and achievement without discarding the value of positive working relationships. Managers must remain approachable and supportive, able to exercise reasonable discretion when employees face personal difficulty or need extra help. Fairness does not demand impersonal management. It requires leaders to distinguish legitimate professional relationships from personal preferences that compromise decisions affecting careers, responsibilities, pay and the allocation of organisational resources.

The strongest cultures combine transparent standards with informed judgement and appropriate flexibility. Recruitment reflects relevant capability, development opportunities are genuinely open, and performance assessments recognise real contribution. Employees also understand that different circumstances can justify different outcomes. What matters is whether decisions are reasonable, consistently governed and open to scrutiny, rather than whether every employee receives exactly the same treatment. In procurement and supply chain management, that culture supports sharper negotiations and stronger supplier relationships.

The defining test of leadership is not whether managers form close professional relationships, but whether those relationships compromise their judgement. Trust, familiarity and loyalty strengthen organisations when paired with competence, integrity and accountability. They become damaging when they determine who receives opportunities, recognition or protection from reasonable expectations. A genuinely merit-based culture ensures that performance matters, relationships remain professional and fairness is visible in everyday decisions rather than merely promised in policy documents.

Summary – When Fairness Becomes the Measure of Leadership

Workplace favouritism rarely begins with a deliberate decision to abandon fairness. More often it develops through familiar relationships, small exceptions and repeated preferences that gradually become accepted practice. Individually, these decisions seem harmless; collectively, they undermine confidence, weaken performance and create substantial financial consequences. The greatest danger arises when leaders stop asking whether personal relationships have become more influential than competence and contribution in the decisions they make every day.

The evidence shows that workplace conflict, inconsistent management and employment disputes impose high costs on UK organisations, from the Acas estimate of conflict costs to more than 50,000 single tribunal claims in one year. Cases involving Royal Mail, Cheshire Police and emergency procurement demonstrate how manipulated assessments, unlawful recruitment practices and unequal supplier treatment can produce serious legal consequences. Although the circumstances and legal principles differ, each reinforces the importance of transparent decisions, objective evidence and effective organisational accountability.

Employment law addresses specified unlawful conduct, and the Employment Rights Act 2025 will significantly widen access to unfair dismissal protection from January 2027, but legal compliance alone cannot create a fair culture. Employers must also confront everyday decisions that may be technically lawful yet commercially damaging, professionally questionable or inconsistent with stated values. Calibration, conflict-of-interest controls, transparent allocation and independent HR oversight convert good intentions into dependable practice.

Fairness ultimately depends on managers and directors being willing to make decisions that are reasonable, transparent and supported by evidence, even when those decisions challenge established relationships. Employees should succeed because their contribution warrants recognition, not because they enjoy privileged access to influential people. When organisations consistently place competence above favouritism, accountability above personal loyalty and integrity above convenience, they build stronger foundations for employee confidence and sustainable commercial performance.

Additional articles can be found at People Management Made Easy. This site looks at people management issues to assist organisations and managers in increasing the quality, efficiency, and effectiveness of their services and products to the customers' delight. ©️ People Management Made Easy. All rights reserved.

Further Reading and Source Legislation

UK legislation

• Equality Act 2010
• Equality Act 2010, section 20 – Duty to make adjustments
• Equality Act 2010, section 26 – Harassment
• Equality Act 2010, section 159 – Positive action: recruitment and promotion
• Employment Rights Act 1996
• Employment Rights Act 2025
• Public Interest Disclosure Act 1998
• Trade Union and Labour Relations (Consolidation) Act 1992, section 207A – Effect of failure to comply with Code
• Working Time Regulations 1998
• National Minimum Wage Act 1998
• Procurement Act 2023, section 81 – Conflicts of interest: duty to identify
• Procurement Act 2023, section 82 – Conflicts of interest: duty to mitigate
• Procurement Act 2023, section 83 – Conflicts assessments
• Constitutional Reform and Governance Act 2010, section 10 – Selections to be on merit
• Local Government and Housing Act 1989, section 7 – All staff of a local authority to be appointed on merit
• Bribery Act 2010, section 7 – Failure of commercial organisations to prevent bribery
• Economic Crime and Corporate Transparency Act 2023, section 199 – Failure to prevent fraud
• Employment Rights (Northern Ireland) Order 1996
• Fair Employment and Treatment (Northern Ireland) Order 1998
• Procurement Reform (Scotland) Act 2014

Cases

• Royal Mail Group Limited v Jhuti – Supreme Court, 2019
• Secretary of State for Health and Social Care v PPE Medpro Limited [2025] EWHC 2486 (Comm) – High Court, Commercial Court, 1 October 2025
• Good Law Project and EveryDoctor v Secretary of State for Health and Social Care – High Court, January 2022 (high-priority lane)
• Good Law Project and Runnymede Trust v Prime Minister and Secretary of State for Health and Social Care – High Court, February 2022
• Furlong v Chief Constable of Cheshire Police – Employment Tribunal
• Royal Mail Group Ltd v Efobi [2021] UKSC 33 – Supreme Court, 2021.

Official reports, guidance and data

• Acas – Estimating the costs of workplace conflict (2021)
• Acas – Code of Practice on disciplinary and grievance procedures
• Civil Service Commission – Annual Report and Accounts 2024 to 2025
• Civil Service People Survey 2025 – Results highlights
• Committee on Standards in Public Life – The Seven Principles of Public Life
• Adam Heppinstall KC – Investigation into the Appointment of the Chairman of the BBC: Report to the Secretary of State for Digital, Culture, Media and Sport (28 April 2023)
• NAO – Investigation into government procurement during the coronavirus pandemic (November 2020)
• FRC – UK Corporate Governance Code 2024
• Ministry of Justice – Tribunal statistics quarterly, January to March 2026
• HSE – Work-related ill health statistics
• ONS – Annual Survey of Hours and Earnings 2025
• CIPD – Good Work Index 2025
• Sutton Trust – Elitist Britain 2025
• Birmingham City Council – Statement regarding section 114 notice (September 2023)