toxic workplaces and employee turnover

December 14, 2023 •

5 min reading

Why toxic workplaces struggle with employee turnover

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In the first part of a mini series on toxicity in the workplace, we explore the relationship between toxic work environments – or “toxicity” in the workplace – and turnover. Employee turnover is an everlasting concern for the hospitality industry. Industry insiders complain about a “turnover culture”. Hospitality firms have difficulties in attracting and retaining talent. Last but not least, the COVID-19 pandemic and the following “great resignation” have made matters even worse. Needless to say that hospitality organizations are keen on minimizing factors that may contribute to even higher employee turnover.

Toxicity at work may be one of those factors. In this short piece, we discuss the concepts of toxicity and toxic work environments and explain where they come from and their consequences. Reducing toxicity in the workplace may eventually turn out to be an important instrument in the toolkit for reducing turnover.


Toxicity in the workplace – What is it?

“Toxic” is a word that is currently jumping at us from all directions. The popular press is replete with accounts of “toxic personalities”, “toxic relationships”, “toxic leadership”, “toxic management”, or “toxic work environments”. So, where are the parallels between all these terms?

Dictionary definitions of the adjective “toxic” obviously zero in on the primary connotation with “poisonous”, but also mention secondary meanings related to something being harsh, malicious, harmful, or causing a loss.

Individuals with a toxic personality are described as very unpleasant, especially in the way they like to control and influence other people in a dishonest way. Signs of a toxic relationship include threats to emotional, psychological, or possibly even physical well-being, such as when a partner frequently or continuously feels misunderstood, belittled, demeaned, or attacked.

Toxic work environments bear many similarities with the above. A toxic workplace is an unhealthy work environment that negatively affects employees’ job attitudes, general well-being, and productivity. Harmful, destructive, oppressive, and counterproductive routines, values, and work behaviors characterize it. Important characteristics of toxic workplaces include bullying, harassment, discrimination, dysfunctional teams, cynicism in interpersonal relations, gossip, rumors, unproductive communication, overwork, and work-related stress. Very often, toxic leadership plays an important role in contributing to the emergence of a toxic workplace.

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Where does toxicity in the workplace come from?

Technically speaking, toxicity in the workplace can have many sources. Toxic personalities can wreak havoc on teams by poisoning work relationships and sabotaging productive work behaviors in the team. Toxic relationships can emerge between peers, and even a toxic subordinate can substantially impact the well-being of a hierarchical superior.

However, the primary source of toxicity in the workplace can probably be found in the behavior of leaders. Leaders play an important role in the workplace culture due to their function as role models. One could say that toxic leadership “rubs off”. More specifically, toxic leadership often sets in motion a vicious circle. Toxic leaders attract others who have manipulative tendencies, underappreciate competence, and overestimate power, politics, and intrigue. Toxic leaders use favoritism as part of their toolkit to create personal dependencies and increase their influence. As a result, they will likely select and promote others based on their (real or feigned) loyalty and admiration for the toxic leader, and only if they do not represent a threat to the toxic leader’s realm. As the saying goes,

A players hire A players, B players hire C players

Conversely, more level-headed employees who focus on “getting the job done”, playing by the rules, and fostering real productivity will increasingly be driven away by the emerging cynicism, unfairness, and lack of consideration for real value-creating work. As a result, the toxic culture is stuck in a self-reinforcing cycle.

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The relationship between toxic workplaces and turnover

There are multiple reasons why toxic workplaces lead to higher turnover. They are related to the negative consequences of toxic workplaces for the general organizational culture, team dynamics, and individual well-being.

Toxic workplaces...

...destroy positive values and replace them with negative ones

In a toxic workplace, positive cultural values (trust, safety, transparency, focus on objective performance) are replaced with their negative counterparts (suspicion, fear, opacity, focus on loyalty, and appearances). This leads to a climate of cynicism and fear.

...undermine trust and foster suspicion

In a toxic workplace, employees lose their trust in co-workers, be they leaders or peers. The network of support that exists in a healthy organization is destroyed, and everyone is “watching their back”.

...destroy effective team dynamics and productive team communication

In a toxic workplace, productive, high-performance teamwork suffers. Lack of trust combined with leaders pitting employees against each other turns teams into dysfunctional units. The focus on an overarching goal and a shared mission the team needs to accomplish vanishes.

...undermine individual confidence

In a toxic workplace, individual employees lose confidence in their competencies and ability to succeed. Shifting alliances, moving targets, and general suspicion and mistrust make it hard to focus on true value-added work.

...limit the developmental potential of competent individuals

As leaders in toxic workplaces often rely on favoritism and control of networks for their own benefit, merit-based advancement suffers. Competent employees lose sight of developmental paths when passed over for promotions and shut out of informal networks.

...create stress and contribute to individual burnout

As a result of the forces outlined above, employees face a situation where additional demands are placed upon them but without a simultaneous increase of resources to tackle them. The end result is stress and, ultimately, burnout.

In Albert Hirschman’s famous framework, individuals can react to these deteriorating conditions with loyalty, voice, or exit. Voice discontent and making constructive suggestions for improvement is a high-risk option in the dominant climate of fear and mistrust characteristic of a toxic workplace. Loyalty becomes difficult to maintain in the face of eroding workplace relationships and increasing levels of stress. As a result, exit is often the only option perceived as viable by employees in toxic workplaces. Turnover is the end result.

Why is it hard to remove toxicity from the workplace

Diagnosing symptoms of toxic workplaces is often very simple – especially for employees with an inside view of the organization. The obvious question is why many organizations find it so hard to reverse the trend and “detoxify”. There are multiple reasons.

Toxicity in the workplace is linked to mechanisms that build up over time and cannot be instantly reversed. For instance, trust can be destroyed in a blink but takes a long time to be regained. Toxicity also seeps into the organizational culture, and cultural change requires time. When toxic values have taken root, it takes time to weed them out.

Perhaps most importantly, taking a stand against toxicity requires substantial courage. This is most obviously the case at lower levels of the hierarchy, where standing up to a toxic leader involves risking humiliation or outright loss of employment. But it also applies at the level of top management, which has the biggest leverage.

Toxic leaders are often good at manipulating others’ perceptions of their performance. They leave few traces of their wrongdoing and are astute at managing upwards. As a result, underperforming toxic leaders may fly under the radar for a long time.

To make matters worse, sometimes toxic leaders may actually deliver good business results. Since these are more directly visible and measurable than the indirect damage toxic leadership creates, it is particularly difficult for top management to justify the removal of successful leaders on the grounds of toxic behaviors alone - even when they endanger the organization's long-term success.

Written by
Dr Steffen Raub
Written by
Dr Steffen Raub

Full Professor of Organizational Behavior at EHL Hospitality Business School

Dr Stefano Borzillo
Written by
Dr Stefano Borzillo

Associate Professor of Organizational Behavior at EHL Hospitality Business School

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