The Signs of a Toxic Work Culture (And How to Fix It)

Your workplace culture is crucial. It impacts staff retention, staff quality, productivity, and your bottom line in so many ways.

Nobody sets out to have a harmful or toxic workplace culture, but it's too easy for one to develop, and it can be a disaster for your company. Improving your workplace culture is a challenge, but one well worth pursuing. 

The Risks of a Toxic Work Culture

The impact of toxic work cultures is often intangible but is nonetheless real. Staff members become disengaged and may be guilty of presenteeism (coming into work but not doing anything) or start shopping their resumes. They are more likely to find excuses to leave early. Also, they will provide lackluster customer service at best, potentially costing you customers and income.

Communication between peers and leadership becomes poor, and confidence in the leadership plummets. More mistakes occur at all levels. Toxic workplaces don't just affect low-level employees but can spread up to the C-suite.

All of this limits your growth and productivity. At worst, it can cost you money through the high costs of turnover, high levels of sick time, and, in extreme cases, potential litigation.

Addressing a toxic work culture is vital to the success and potentially your company's survival. Since nobody sets out to develop a toxic culture, how can you identify one?

The Signs of a Toxic Work Culture

Toxic work cultures have specific warning signs that leaders and managers can look out for, which include:

• High turnover rates. People may feel pushed out, not like the atmosphere, or feel they are the wrong people.  

• Cronyism, or perceived cronyism. Cronyism occurs when you promote people for their connections rather than their merits. For instance, managers promote their friends (or not promote qualified individuals because they don't like them). Cronyism can also happen when there are intimate relationships between employees or, worse, between supervisors and employees. 
• Gossip. Expect a certain amount of "water cooler talk," but it can indicate a problem when the gossip turns negative. Also, if the grapevine is doing a better job than your official communications channels, you have a problem. 
• Lack of communication and reserved behavior from employees. Interactions tend to be more formal than friendly. 
• High levels of concern for status and job descriptions rather than doing your job. 
• Lack of interaction between managers and employees. 

• Body language indicates fear or distress. 
• Overall lack of trust. 

Toxic work cultures can be self-reinforcing, and if you don't take steps to fix them can quickly turn into a downward spiral.

How to Establish a Positive Work Culture 

It's easier to avoid a toxic work culture developing in the first place. Establishing a positive culture requires communication, trust, and an HR department that is on the ball and ready to spot any changes for the worse. 

However, here are some ways to establish a positive culture and improve your workplace. 

Make Proactive Changes 

Toxicity breeds toxicity. Companies must be proactive in changing their work culture before it destroys the company. Otherwise, they will undermine leadership, key employees will quit, and customers will discover what is going on and likely go elsewhere for their needs. 

You can only fix this at the source. The first step is to survey employees and ask candid questions about their emotional state when at work. HR plays a key role here. If you damage trust between employees and their managers, employees will not be candid with their manager or supervisor. If things are too bad, you may have to have employees interviewed by outsourced neutral parties. 

You need to find out what is causing the workplace to be toxic. For example, you may need to provide managers with additional training to help them fix bad habits contributing to toxicity. You may need to change policies (often by loosening them, as excessive rules can lead to toxicity). You need to be very proactive. 

Also, demonstrating that you listen to employee concerns goes a long way towards making a culture less toxic. 

Tips for an Improved Culture 

So, how do you improve your workplace culture in general and keep it from becoming toxic, or make it less so if it is? 

First of all, it starts with open conversation and dialog. Make sure that you don't punish anybody for speaking up about concerns. If somebody is overworked, get them some help instead of blaming them for not getting everything done. 

You can increase transparency through one-on-one meetings, which support a better relationship between employee and supervisor and encourage candid opinions by increasing confidentiality. Ensure that you recognize employees for their merit, not just at an annual review where you may or may not give a bonus. Ongoing recognition improves employee engagement and productivity. Always follow through when you promise to implement changes. If you can't implement a change, be transparent as to why. 

In the worst-case scenario, you may find out that the toxicity centers around one or a few individuals. You may need to consider removing these individuals, either from a leadership position or the company. While you can resolve many problems with training, sometimes you may realize you have hired or promoted a lousy boss. Firing somebody is the last resort, but it should never be off the table. 

Improve Your Culture with Help from a PEO 

A toxic work culture results in high turnover, low productivity, high absenteeism, and potential legal costs. Understanding the signs of a toxic workplace can help you quickly identify if you have a problem and proactively fix it. It requires a lot of work from HR, and outsourcing to a professional employer organization can help by freeing them from tedious work and giving them access to the PEO's knowledge and experience, improving company culture.