Signs you’re fostering a toxic work environment and how to fix it

The Great Resignation has spotlighted workplace situations employees are unwilling to accept, and a toxic work environment is at top of the list. People are stressed, burned out and fatigued. Record-breaking resignation rates underscore that individuals are fed up and find the paycheck is not worth the mental or physical toll.

Ironically, it’s companies that pay a hefty price when toxic work behaviors are unaddressed.

“The financial impact that toxic people or a toxic culture costs the company is at least 6% of the organization’s total compensation,” said Vistage speaker Dr. Mitchell Kusy. He is the founder of Kusy Consulting & Associates, author of “Why I Don’t Work Here Anymore: A Leader’s Guide to Offset the Financial and Emotional Costs of Toxic Employees,” and a consultant with the Healthy Workforce Institute. “So, for an organization spending $100 million on compensation that means you’re spending $6 million at a minimum dealing with toxic behavior.”

Here’s what you need to know as a leader to recognize if you have a toxic work environment.

What defines a toxic work environment?

A chaotic or disorganized work environment creates a tumultuous workplace but doesn’t necessarily indicate a toxic company culture.

Even on the good days, stress is part of any work situation, so high-stakes pressure alone isn’t enough to determine if you have a toxic work culture, nor is being dysfunctional.

“When I look at dysfunctional companies, they could be dysfunctional without being toxic. It’s still just not very functional,” said Vistage Speaker David Friedman, founder/CEO of CultureWise and author of “Culture by Design.” “Toxic is far more negative — it’s hurtful versus just screwed up. I would say all toxic companies are dysfunctional, but not all dysfunctional companies are toxic.”

He added that a toxic work environment makes employees feel uncomfortable being themselves and doing their best work.

5 signs of a toxic workplace

A toxic or hostile workplace causes severe disruptions in a person’s life, even after they clock out of work at the end of the day. This could be the result of:

• A company-wide culture
• A department-specific atmosphere
• An individual
• A combination of the above

The person suffering in a toxic workspace may experience sleeplessness, hypervigilance, increased heart rate and more. A leader likely won’t see these physical cues in an individual, but the accumulated tension manifests itself into visible signals.

Signs of a toxic work environment include:

1. Turnover

High resignation rates suggest a toxic workplace culture. Comments shared during exit interviews may offer insight but must also be taken with a grain of salt. Those remarks combined with data, like negative reviews on Glassdoor, suggest a specific workplace is one people want to avoid, Friedman noted.

2. Shaming and sabotage

Dressing down a person in public or private, passive hostility and sabotaging team efforts to make oneself look good are clear indications of a toxic workplace environment, Kusy said.

3. Absenteeism

Toxic work environments directly impact employee health and well-being. The stress of a toxic culture develops into staff fatigue, burnout and sickness. High rates of employees calling in sick or showing up sick means it’s time to take a deeper look.

4. Discomfort

People are afraid to speak up in meetings. Friedman said it is essential to question the workplace environment if staff feel like they can’t contribute by sharing insights and feedback.

5. Prioritizing high-performance

Expecting exceptional quality is a leader’s job. However, exclusively measuring performance without considering the impact or harm that may be caused along the way indicates a toxic work environment, according to Kusy.

Toxic workplace culture can be an accident

It’s easy to identify how a leader’s negative behaviors contribute to workplace toxicity. However, a respectful manager can inadvertently foster a toxic culture by allowing a negative individual to remain on staff.

A toxic person can bring everybody down around them. Typically, this individual is a high performer, so leaders fear firing them will affect sales or customer relationships.

“This person causes all sorts of disruption, but they often bring in a lot of business,” Friedman said. “The CEO or leader may not have the courage to let that person go even though they can see what’s going on.”

Rarely does an organization lose money or clients after the toxic individual resigns or is fired. Instead, the rest of the group collectively sighs with relief.

“The best way to know the culture of your company is to look at the behavior that you tolerate,” he said. “If you allow toxic behavior, that’s your culture. I don’t care about all the stuff you put on the walls, or the website…. Whatever you allow is the real culture.”

Toxic positivity in the workplace

Being positive is a trait leaders can use to inspire and motivate staff. However, focusing too much on positivity can contribute to an unpleasant work environment.

“A hyper-focus on positivity could come across as lacking empathy,” Friedman said. “In other words, it could serve to invalidate or be dismissive of the real challenges and frustrations that people face.”

People could feel like you “just don’t get it,” Friedman cautioned. If people aren’t being motivated by your positivity, or it’s falling on “deaf ears,” take that as a warning sign.

“Be empathetic, recognize the challenges people face and then reassure them with a sense of confidence that together we can overcome challenges,” he said. “It’s also helpful to point out times in the past where the team has been able to overcome setbacks or challenges.”

How to fix a toxic workplace culture

The good news is that if you’re willing to invest in changing the workplace culture, it is possible to turn around a toxic workplace environment. These four strategies can help you get started.

1. Show respect

Researchers Christine L. Pearson and Christine M. Porath found the No. 1 behavior employees want to see from the leadership team is respect, Kusy noted. How that is displayed may surprise you. He further noted that in a study by recognition expert Sarah McVanel that 88% of employees wanted a thank you note.

As the director of leadership development at American Express Financial Advisors (now Ameriprise), Kusy used the company’s “Values In Practice” notecards. A leader could handwrite a note inside the blank card when they saw someone acting or performing in line with the company values.

“I thought it was kind of hokey until I got hired and received my first note. Linking a thank you to the value of the organization is key,” he said.

2. Find clarity

Values, mission and culture are abstract concepts. Creating concrete examples brings clarity to the culture you want to foster.

“Define the behaviors and actions that would lead to the healthy environment you’re trying to create,” Friedman said. “Then it is easy to recognize the places where that is or is not happening.”

3. Reinvent exit interviews

Most employees won’t be 100% open in an exit interview about the impact a toxic leader has on their decision to leave. They may say, “This leader demands perfection.” What they’re really saying is, “This leader has such a drive for perfection that it’s forcing me to leave.”

“Ask the individual departing if you may contact them in 60 days to discuss their experience in the organization,” Kusy said. “It gives the person an opportunity to talk when they are not worrying about how what they say might impact how they are seen at the new job if their boss has a connection with anyone there.”

4. Own it

Ultimately, it is the CEO’s responsibility to make the decisions that support company culture. Collaborating with the leadership team and asking for input is important, but the boss must make the final decision, according to Friedman.

How leaders can acknowledge a toxic workplace and apologize

Saying “I’m sorry” is one of the first lessons kids learn and perpetuate into their professional careers. How the apology is delivered is more important than using those two small words, according to Kusy.

Kusy noted that, “In Western culture, communications experts have found that ‘but’ usually follows ‘I’m sorry,’ and that ‘but’ is an excuse that negates the apology.” He further shared that leaders should engage in this four-step model to change the dynamic.

1. Frame what was done. For example: “I have been interrupting people and not allowing them to finish their sentences.”

2. Express impact. Acknowledge the effect this is having. “I know people are reluctant to share their views and feeling that these team meetings are top down and not engaged.”

3. Say “I’m sorry” or “I apologize.” Break the habit of adding “but” after an apology.

4. Rectify. Share how you will address this. “I welcome your feedback if I run ram shod or interrupt consistently. Feel free to stop me mid-sentence or if you’re not comfortable with that, feel free to talk to me after the meeting.”

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