How to manage toxic employees in the workplace

Last updated:
March 16, 2021
December 16, 2021
min read
Adrie Smith
|toxic worker warning signs
Table of contents

It’s inevitable that amongst the hundreds of staff you’ll employ over your working life, not all of them are going to be typical ‘tow the line’ angels or ideal operatives. At some point, you’re going to employ and experience what has become known as the toxic employee.

Not all of your problem employees are toxic, however. There’s a difference between difficult and toxic. Difficult can be rude, lazy, tardy, and more—they’re still a nuisance, but a toxic employee causes harm to their teammates or the business.

Your toxic employees in the workplace are not always the easiest staff to remove, either. And if you can’t terminate them as easily as you’d like to, what can you do to turn their toxic employee attitudes into healthy workers and possibly your prime performers?

“Roughly 1 in 20 workers is ultimately terminated as a toxic worker.” — Michael Housman and Dylan Minor

What do you mean by “toxic”?

Housman and Minor identify toxic employees as those who engage in behavior that is harmful to organizations.

The most harmless things they can do are being a bad fit and would cost the search and training for replacements. And the most harmful things they can do range from falsifying documents, sexual harassment, costing billions of dollars legal fees, to threatening the lives of their colleagues.

No sensible manager would want these workers on board. Elon Musk makes it very clear: “We have a strict “no-assholes policy” at SpaceX. And we fire people if they are.”

Preventing them from entering the organization would be even better.

Housman and Minor explore a novel dataset of the actual performance and characteristics of many workers in different organizations. They track down three prominent signals that are associated with toxic behaviors to watch out for.

The 3 characteristics of a toxic employee

toxic worker warning signs
  • Self-regard. Researchers have long found out that the people who regard others less should be more inclined to toxicity. Because they don’t fully understand the cost that their behavior inflicts on others. Housman and Minor put it as “those that show little concern for another’s interests are less likely to refrain from damaging others and their property.”
  • Overconfidence. These often overestimate their own abilities. Housman and Minor found out that “those who appear overconfident by over-reporting their skill level before they start the job are more likely to be terminated for toxic behavior across all time.”
  • Profess to follow the rules. The toxic worker often claims to follow the rules, but actually does not. “Subjects are highly incentivized to respond to a rule-following question in a job application in whichever way they believe will secure them a job.” Housman and Minor conclude that this Machiavellian nature is likely to lead to toxic behavior. They also calculate that if a worker says that she believes to always follow the rules, she has about 25% greater hazard of being terminated for actually breaking the rules.

The thing is, even if a candidate shows all three traits, many recruiters/interviewers will still let them off the hook. Because they themselves are hooked by the candidate’s performance record.

The one characteristic that a toxic employee possesses that lets them get away with being toxic

“Specifically, we find that toxic workers are much more productive than the average worker.” Housman and Minor discern.

However, if you look at the quality of the work, toxic workers may be faster, but not necessarily be more productive than the average worker. “Almost 50% more workers that produce high quality work quickly (32.4% of workers) than those that produce low quality work quickly (23% of workers).”

Housman and Minor conclude that in the long run, toxic workers are not likely to improve the overall performance of an organization, despite their productivity.

Yet. Are you willing to make the trade-off? A risk that excels in performance?

So, how do you manage toxic employees in the workplace?

When it comes to managing toxic employees, there are a few tools you can utilize to find out why they behave how they do and the things you can subsequently engage in to try iron out those terrible bumps.

Try to understand where the toxic behavior stems from or how it started.

If you can understand why your most problematic staff behave as they do, then you’ve got a far better chance of getting to the root of the problem right away. You don’t have to be a psychologist to unravel the mysteries of their behavior, but if you can spot the cause of their poor conduct, then you can refer them to someone qualified to help.

Something as simple as a quiet chat or a more open conversation during an appraisal could reveal problems in their home life, working relationships, job or role frustrations, or any other triggers.

If you can coach them through their issues—whether practical, work-based, or a mental health issue—you’ll see some light at the end of the tunnel far sooner than you might expect.

Provide direct, regular feedback.

Feedback can prove to be the key with toxic employees. Much of the time many won’t even realize they’re causing so many issues, as they’ll be far too focused on what’s going on in their corner of the world.

Using direct, open, honest, yet calm and kind feedback could open their eyes to an area where they had no awareness. If aware of their behavior,  it gives you a starting point in laying down the boundaries and consequences, as discussed in the next section.

A good manager knows how to help his teams by choosing their words and delivery carefully. There’s no room for bullying in business or heavy-handedness in how we communicate with our staff.

Outline their behaviors tactfully, and explain what’s expected of them. Let them know that they’re not adhering to best business practices, but tread gently—it might be a big surprise to them that they’re not the high-performer they think they are.

Set boundaries and expectations—outlining the consequences.

While getting to grips with managing toxic employees, they may still try and rise above your views and decisions, despite your position being superior to theirs. At this point, you should make sure they understand who’s in charge and the consequences of further disruption and conflict.

You can tell them what’s acceptable and what isn’t. They might need a little time and practice to adjust from what they believed was appropriate and into a new way of behaving.

They’ll also need to understand the severity of behaving as they are over the long term. The threat of losing their position, especially if it impacts being hired anywhere else in future, may be enough to convince them that they need to change.

You can also deliver the positive consequences at this stage of your discussions. As their behavior or actions improve, you can educate them on how advancing through the company will be far more open for them, how their relationships will improve with other team members, and just how much more comfortable they should feel around the office.

Stay assertive, and utilize a support network.

Because your toxic employees will generally have a strong attitude and character, it’s easy to become drained—emotionally and physically—while dealing with them. Keeping the upper hand is the first thing to do to retain some of your mental and physical resources, and the other is having the proper support in place for when you need it.

You may simply need a good listener to allow you to offload your stresses. Otherwise, it may be appropriate to have a professional partner to act as your sounding board. Whether that’s someone inside your HR department or an outside professional, make sure you have all the best resources to manage yourself, as well as your teams.

Document the process to the last detail.

Keeping an all-inclusive record of your toxic employee’s behaviors and actions is imperative from the first signs of misbehavior and their subsequent offences. If the time comes to have to terminate them, you’ll have to follow company protocol and have all the proof in place accordingly.

Supporting material, including complaints, warnings, or other resources, will act as proof if matters require mediation or end up at any type of tribunal.

The further back your documentation goes, and the more inclusive it is, the better prepared you’ll be for the worst-case outcomes.

“Avoiding toxic workers is still better for the firm in terms of net profitability, despite losing out on a highly productive worker.” — Michael Housman and Dylan Minor

Final thoughts from Housman and Minor and what you can do to avoid onboarding toxic workers

(You can click on each quote to tweet it)

Relevant: Read the original paper “Toxic Workers” by Michael Housman and Dylan Minor.

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