Workplace Wellbeing

The Cost of Toxic Culture—and How to Fix It

Facilitating a healthy and positive work culture is a cornerstone of any high-performing company. Here’s how you can achieve this in your workplace.

Written by
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Kris Kopac
Clinically reviewed by
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    Did you know that a toxic corporate culture is the strongest predictor for employee resignation and turnover? Not only does it drive higher levels of resignation, it also discourages employee engagement and prevents an organization from performing at its best.

    Facilitating a healthy and positive work culture is a cornerstone of any high-performing company. So, how can you achieve this at your organization? Read on to learn more about what constitutes a toxic work environment and how to combat it.

    What creates a toxic work culture?

    A toxic culture can span a variety of different behaviors, ranging from moderate to severe. Some of the most common ones include:

    • Gossip and back channeling: a culture of speaking poorly or inappropriately about team members, or trying to push work or personnel decisions through without the knowledge of key people involved.
    • Workers feeling disrespected or unheard: the inability for employees to safely express their thoughts or opinions without facing retaliatory action or verbal abuse.
    • Failure to promote diversity, equity, and inclusion: workers being passed up for promotions or work opportunities due to their race, class, gender, disability status, or sexual orientation. This also includes derogatory comments or a culturally insensitive environment.
    • Unethical behavior: participating in, encouraging, or coercing other employees to participate in unethical or illegal business practices.
    • Backstabbing or cutthroat behavior: taking retaliatory action toward employees who are performing necessary work duties or bringing up work environment issues.
    • Abusive management tactics: company leaders who belittle, verbally, emotionally, or physically abuse employees, or use intimidation or coercion as a management tool.
    • Harassment: unwelcome and severe or pervasive behavior that becomes intimidating, whether sexual, physical, or verbal. This also may be in relation to race, religion, sex (including sexual orientation and gender identity), disability, and other protected demographics.

    A toxic work environment doesn't just spring up overnight. It is often entrenched due to past incidents, management culture, and scarcity of resources. For example, a team leader who disparages employees in the company or makes inappropriate remarks about the appearance of a coworker sets the tone for how others should follow.

    Employees who have witnessed poor behavior in the organization may internalize that this is the only way to get ahead. This kind of environment may cause them to hold grudges against other teammates and departments, act in a retaliatory manner, or feel like they need to fight for resources (such as team budgets) in a cutthroat way.

    There are a variety of steps company leaders and HR managers can take to create a healthier and more positive work environment for everyone.

    Create a culture of DEIB

    Diversity, equity, inclusion, and belonging (DEIB) are a foundational element for any healthy work environment. In fact, nearly half of Hispanic and Black workers quit a job after witnessing or experiencing discrimination at work.

    Your HR team can prioritize DEIB within your organization by giving time and resources to prioritize best practices. Here are a few ways to do this.

    Review pay equity

    Women and workers of color still face a yawning pay gap that has yet to significantly improve. Take time to review your company's compensation data to ensure that employees are being fairly and equitably compensated. Creating standard salary ranges based on controllable factors and comparing against the highest and lowest compensated people within similar roles is a great way to get started.

    Create a welcoming workplace for new parents 

    New parents and employees with children often struggle to meet the demands of full-time work and parenthood, especially when most households now have both parents working. Offering flexible work schedules, paid parental leave, and advance notice for schedule changes are just a few ways to create a healthier work environment.

    Infuse DEIB into all business practices 

    Instead of marginalizing DEIB into a small portion of your business, look at how management can infuse inclusivity into every aspect of the business. This will have a net positive impact on overall work culture and retention. Taking these initial steps will create a more inclusive and welcoming culture that retains employees and helps stem losses from The Great Resignation.

    Create psychological safety

    All employees need to feel safe enough to talk about any concerns or behavioral issues within the organization. Your HR team can work at the top levels of your company to cultivate an open and communicative culture that allows people to safely air their concerns. Start by putting in safeguards to prevent retaliatory behavior from feedback.

    Next, encourage managers to have weekly one-on-ones with their employees, and train them on how to provide constructive feedback consistently and well—instead of only when a problem pops up or it’s time for an annual performance review. When managers model this, employees will begin feeling safe enough to provide their own feedback as well. And when leaders begin sharing their own struggles and challenges, it can create more trust and a deeper level of psychological safety. This can also help your employees feel more valued and willing to contribute much-needed fresh ideas and perspectives.

    Provide mental health benefits

    It's one thing to say you support mental health at work, but providing tangible benefits to your employees is the best way to show your support in an effective way.

    One study found that 68% of Millennials and 81% of Gen Zers have left roles for mental health reasons, both voluntarily and involuntarily. It’s become critical to craft and communicate messaging from the top down to show that workplace mental health is just as much of a priority as physical health.

    One easy way to do this is to provide paid time off for mental health days. HR and company leaders can also train managers on the best way to broach discussions of mental health issues with employees when appropriate.

    While managers should not try to discover, diagnose, or speculate on an employee's mental health conditions, they can provide access to mental health support with trained clinicians.

    Taking these steps will show your employees how much you value their mental wellbeing while creating a healthier work environment.

    A comprehensive mental health benefits package should include care that’s:

    • Precise. Employees who receive fast access to mental health support and get the right type of care for them at the right time are far more likely to experience positive benefits and results.
    • Personalized. While some employees may need help with medication management, others might need career coaching, cognitive behavioral therapy help, or specialized therapists. Providing a variety of tailored options will bring the best results.
    • Proven. Contact benefits health providers to gather data around their efficacy. How do these mental health benefits improve employee engagement? How long does it take employees on average to see a provider? Having these numbers in hand will help you make the most informed decision.

    Overall, providing quality mental health benefits for your employees has a proven return on investment—and is one of many ways to dismantle a toxic corporate culture.

    Employers who create a healthy work environment and prioritize the mental well-being of their employees are less likely to feel the pains of the Great Resignation and Reshuffle.

    By taking these steps to eliminate the elements of a toxic workplace, you can support your employees' mental health and improve your company's performance and retention.

    About the Author
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    Kris Kopac

    Kris is a writer and marketer based in Chicago. Kris specializes in subjects around HR, recruiting, and employee happiness.

    About the clinical reviewer
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