Turn a Toxic Workplace Around, A Guide for Leaders


It can take hold when your attention is directed elsewhere, or you may have inherited it when you took a new position. But once you see that your workplace is toxic, you can’t turn away.

Toxic workplaces drain the company of vitality and talent and can incur significant reputational and economic costs as well. The potential impact to the health of the business, as well as employees, makes it essential that rehabilitating the toxic work culture becomes the top priority for company leaders.

Signs of the Toxic Workplace

Bob Sutton, professor of Organizational Behavior at Stanford University, offers a three-point checklist for determining whether you have a toxic workplace on your hands.

  • Physical and mental health is suffering.

This might show up in employees as a general malaise or dispiritedness, low-grade anxiety, and perhaps hints of trouble in relationships at home, as well as in the workplace. These signs could point to a long-term bullying problem, Sutton suggests.

  • Performance is suffering.

You might notice that the quality of work is consistently disappointing. Employees may be late delivering projects, be reluctant to go the extra distance, and lack creativity. They don’t care about the company.

  • You’re starting to act out yourself.

If you find yourself acting or speaking in ways that are unfamiliar to you, and that you don’t like, you could be adopting some of the characteristics that are making it unpleasant to work at your company.

Employees might have tried to approach you or your predecessor about experiencing these feelings themselves. Often employees are most forthcoming when they hand in their notice. When the concerns are dismissed or ignored, that points to deeper cultural problems at the company. If you find yourself or your leadership team regularly becoming defensive, it may be time to take a closer look at the culture.

How to Improve the Company Culture

Consider Bringing in a Third Party

Acknowledging that the workplace has become toxic is an important step for the company. Tracking the cause presents more difficulties, especially if workers are reluctant to come forward to report negative experiences.

networkingA third party is often able to identify the behaviors and attitudes that are having a detrimental effect on morale more effectively than managers, and employees are more comfortable sharing information with someone not entrenched in the company.

Hiring a third-party consultant is also an important step if it becomes necessary to deal with the behavior of high-level individuals.

Look for the Toxic Worker

Finding the immediate source of the problem is paramount and that often leads to an individual. The toxic worker is not just unsuited to the position, or an underperformer. He or she is harmful to the organization itself, including its property and people. The bad behavior of the toxic worker can range from general negativity or undermining of company values to obvious ethical and regulatory breaches.

The toxic worker has an outsized effect on the workplace. The worker can set off contagion in the office, whether fellow employees emulate the behavior, fall victim to it, or become so demoralized that they leave the company. The fallout that results carries heavy costs for the company.

In “Toxic Workers”, a 2015 working paper from Harvard Business Review, authors Dylan Minor and Michael Housman found that a company can save about $12,500 in turnover costs by avoiding a bad hire – that’s more than twice the amount that a superstar employee adds to the bottom line. The cost of the toxic worker climbs, when factors such as loss of customers, litigation fees, regulatory fines, and employee turnover are included.

Neutralize the Toxic Behavior

You need to stop the bad behavior before you can address the larger issues that left it unchecked. If you spot the problems early enough, you may be able to change the employee’s behavior by establishing clear boundaries and calling out the offending behavior. Document the behavior that is raising your concerns. This will help you keep track of progress, and it will also be a useful written record if disciplinary action is required.

If these actions don’t bear fruit, and the workplace remains stressed, the problem employee may need to be removed. Difficult as it is to let an employee go, take heart in Minor and Housman’s conclusion that avoiding the toxic worker is more profitable than keeping him or her, no matter how productive they may be.

Company Time

To repair the work culture and regain the trust of employees, the company needs to take an unsparing look at its own role in fostering the conditions that created it. For example, overlooking violations of company policy, bullying in the workplace, and inequities in the treatment of employees gives implicit permission for toxic behavior to continue and escalate.

Leaders can work toward healthy, safe conditions for all employees with these important steps:

  • Revise company policy with updated rules that support a healthy workplace.
  • Establish a safe work environment where employees are protected from reprisals when they bring concerns forward.
  • Communicate to employees that the company values the wellbeing and safety of the workplace, through personal interaction, consistent company-wide messaging that reinforces company policy and the behavior of company leaders.
  • Walk the talk; actively ensure that the policy will be enforced equally throughout the company.

Team Works

It is essential to include employees when you set out to establish a workplace where their safety and wellbeing are priorities. The task of company leaders is to re-engage employees and convince them that their lives will be better.

Take a few tips from Douglas Conant, who took over as president and CEO of Campbell’s Soup in 2001, when the stalwart company’s fortunes were ebbing and in need of revitalization. Conant changed the toxic workplace that he was given by applying his vast reserves of emotional intelligence to gain employees’ trust and participation.

Conant recalls two key elements of his campaign. First, he declared out loud what the values of the company were, and then he delivered on his promises. That meant modeling the behavior that the company promoted – walking the talk.

We’re All in This Together

Conant vigorously pursued engagement with company employees, setting out to interact with as many as possible every day, including handwritten notes that recognized individual contributions. The encounters kept him informed of what was going on at the company and gave employees a human face to associate with the company.

“Leaders have a bias for action”, says Conant “When they’re listening, it may not feel like they’re accomplishing anything. Nothing could be further from the truth.”


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