A company’s culture, which refers to a workplace’s overall ethos, as well as the values and initiatives that set the tone for how managers lead employees, can either be its greatest strength or its most harmful weakness. The trick is to be vigilant against the signs of a toxic work culture and seek to improve them. In most cases, it only takes five steps to change your company culture.
What Is a Toxic Work Culture?
A toxic work culture is a company environment dominated by practices, policies and management styles that perpetuate unhealthy habits and conflicts among team members. It can be harmful to employees, preventing them from being productive and growing professionally. Bad organizational culture can also lead to unhappiness and dissatisfaction that drives employees to look for jobs elsewhere.
On one level, toxic work culture is institutional-centric; the company’s policies and procedures are designed with itself, not its workforce, in mind. Negative workplace culture also often means outdated work policies — for example, a requirement to work from the office — that are mistakenly thought to squeeze the most productivity from an employee, or an offering of benefits and perks that are easy on the company budget, but tough on employees’ lives.
A toxic work culture typically results in workplace “illnesses,” such as lack of cohesion among teams, increased absences and tardiness, lower productivity and high turnover.
Red Flags of a Bad Company Culture
- You don’t have a list of core values.
- There’s a lot of gossip in the office.
- Unfriendly employee competition.
- Employees are often tardy or absent.
- Employees often work late or don’t take lunch breaks.
- Still hiring for culture fit.
- No DEI policy.
- No workplace giving initiatives.
- Little or no hiring from within.
- Public criticism of employees.
A strong company culture is important for your company’s longevity and business success. In order to build an exciting culture that will entice job seekers and retain employees, you need to be thoughtful with the type of organizational culture you aim to create. Be vigilant against the following bad company culture red flags to allow a positive work environment to flourish.
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16 Signs of a Toxic Work Culture
1. Core Values Are Absent
The Problem: Perhaps the most concerning sign of a bad company culture is a lack of company core values. These are the driving force of an organization — not having core values means your culture is likely to progress without any sense of direction. Unwanted subcultures will form and undermine your business’ success.
The Fix: Draft and publish a list of core values. These should be the set list of ideals that truly matter to your team and will help you achieve your goals. Before promoting them to the rest of the team, ensure C-suite executives, HR representatives and long-term employees are aligned on core values. Then, go over each value with the rest of the team. Doing so will help elicit positive behaviors and attitudes, creating a cohesive company culture. Refer back to your core values during the hiring process to ensure each employee you onboard shares the same values as your team.
2. Managers Don’t Follow Core Values
The Problem: Employees look to managers for direction. If senior and middle management aren’t abiding by the core values you’ve set forth, employees will follow suit. Even worse, they’ll begin to distrust leadership for exempting managers from the office rules. Authority will be discredited, and a clear divide will form between leadership and the staff.
The Fix: Lead by example and hold everyone accountable. Core values are important to your culture and your success as an organization, so ensure they are upheld by every member of your team. Holding all employees to the same set of standards will foster an open culture based on equality. This will also help promote your core values across all departments so they become ingrained in your culture.
3. Office Gossip Runs Rampant
The Problem: It wasn’t cool in middle school, and it certainly isn’t appropriate in the office. Gossip leads to unwanted cliques that divide your workforce, turning employees against each other and creating a culture of distrust.
The Fix: If you’re noticing that the rumor mill is churning more often than not, address the situation head on. Try to identify the individuals who seem to be involved most frequently and speak to them one-on-one. You should also formally address the entire company so every employee knows this behavior will not be tolerated.
4. Turnover Is High
The Problem: High turnover is almost always a guaranteed sign of a toxic company culture. Not only will a bad culture drive employees away, it will also deter job seekers from taking your organization seriously; more than 30 percent of workers say they left a job in the first 90 days because “company culture was not as expected” and 20 percent reported switching industries because of a “toxic work environment/culture.” If you’re saying goodbye to employees left and right, they’re probably looking for a less toxic work culture.
The Fix: It’s time to double down on your company culture strategy. To do that, however, you need to understand the root of the problem. Probe employees during exit interviews on their reasons for leaving. Try to understand what it was about your culture that frustrated them and which aspects they found difficult to part with.
Then, talk to employees — especially long-term employees — to get a sense of what’s kept them around. Consider conducting an employee engagement survey and carefully analyze the results. Once you know what you need to improve, act on it.
5. Unfriendly Competition Abounds
The Problem: Healthy competition is good for business. It motivates employees and encourages stellar performance, which can help grow your company. However, having competition as the focal point of your culture will breed animosity between employees.
The Fix: If you see that individuals are highly competitive with one another, you may be placing too much value on performance. Of course you want your team to be full of top performers, but you also want your team to be full, period. Pitting individuals against each other will frustrate employees and undermine their value as individuals.
To avoid sending great employees packing, recognize performance on a broader scale and outside the confines of monetary rewards. Encourage managers to recognize their direct reports’ effort and reward their achievements with prizes centered on wellness, such as a comped fitness class, gift card to a favorite restaurant or an extra day off. Additionally, create a platform for individuals to congratulate and thank their coworkers for a job well done. This will motivate employees and encourage a team-oriented mindset.
6. Employees Often Show Up Late or Miss Work
The Problem: Excessive tardiness and/or high rates of absenteeism are clear signs of a bad organizational culture. Your employee’s tardiness should tell you that they’re either lazy — a negative quality that will hurt your culture — or disengaged. Similarly, if employees are frequently out-of-office — with remote or flex-schedule employees being the exception — they’re likely disinterested and not passionate about their work.
The Fix: For starters, ensure that middle and senior managers are prompt at the start of the day. Employees learn from managers, so if one manager routinely shows up 30 minutes late, their direct reports will believe they can do the same. From there, talk to the repeat offenders about their work schedule. It’s possible they have a regular conflict — such as dropping their kids off at school or commuter restraints — that merit an adjusted start time.
Engage your HR department to improve how your team tracks sick days, doctor appointments and other approved absences. Of course, you should be open to discussing personal matters and extenuating circumstances. Together, these approaches will help improve your absenteeism rate and create a positive work culture that prioritizes communication.
7. People Work Through Lunch
The Problem: If employees often work through lunch, it’s either because they feel they don’t have time to stop working, or they believe management doesn’t condone taking breaks. Not only is that poor business logic — more than three-quarters of workers say lunch breaks improve job performance — it’s also a surefire way to turn employees away. Expecting that employees will perform well while working eight hours nonstop is ridiculous. Moreover, it signals to them that leadership only values their work output, not their contribution to the culture or personal commitment to the organization.
The Fix: Simply encourage lunch breaks. Start by taking lunch yourself, and remind employees to enjoy their break time. Occasionally providing food for the office is a great way to impose a midday break, get to know your team and allow employees to socialize with their peers. Additionally, make a point to inform new hires of how long they’re allowed for lunch. Otherwise, they may avoid taking a break altogether.
8. Employees Leave Bad Reviews of the Company
The Problem: Anonymous review platforms have increased visibility into any company’s culture. If you have a positive work culture full of highly engaged employees, this only helps your case with prospective candidates. However, if your team is frustrated with the management style, cut-throat competition between peers or discouragingly high turnover rate, job seekers will be the first to know, and your company will earn a harmful reputation as a result.
The Fix: Build out your employer branding strategy. While you can’t control the public’s perception of your company, you can help shape the story. Of course, it’s important to build an accurate employer brand, which can only be done if you first create an exciting workplace culture.
9. The Company Doesn’t Give Back to the Community
The Problem: If your company lacks a matching program for charitable donations, doesn’t offer a yearly day of service for volunteer work, never issues calls for donations in the wake of a devastating hurricane or other disaster, you’re sending the message that as a company, you just don’t care about the outside world.
The Fix: Launch a program that gives back to the community. Offer a yearly day off for employees who want to volunteer. Do a back-to-school supplies drive for a local nonprofit. Or participate in United Way’s workplace giving campaign. Even the smallest initiative will demonstrate to employees that you do care.
10. Employees Aren’t Acknowledged and Rewarded
The Problem: If you only recognize the top sales rep of each quarter, you’re doing your culture a disservice. Only occasionally rewarding a few individuals will make the majority of the workforce feel undervalued and underappreciated. It can also lead to a negative workplace culture founded on competition and animosity between employees.
The Fix: Talk to middle and senior managers about instituting more feedback sessions with their direct reports. They can use this time to provide constructive criticism and acknowledge the individual’s great work. Additionally, carve out time in your monthly all-hands meeting for employees to recognize and appreciate other team members and implement regular employee spotlights. Providing positive reinforcement motivates individuals and this format allows employees to form meaningful connections with their peers.
11. Managers Don’t Promote From Within
The Problem: If all your new hires are from outside the company, especially at a management and leadership level, you’re sending the message that current employees either don’t matter or they’re not good enough to be promoted. Both messages contribute to a toxic work culture that stymies growth.
The Fix: Start paying attention to those employee reviews. Add a question that helps discern whether an employee wants to move up the ranks, then start a formal program to mentor and coach employees with potential.
12. Managers Publicly Criticize Employees
The Problem: Employees make mistakes, sometimes bad ones. A toxic work culture makes a big deal out of these errors by calling out employees by name, and mistake, in a public forum.
The Fix: Praise in public, correct in private, and present the error as an opportunity to learn and grow. A healthy work environment allows employees to learn from their mistakes without shame.
13. People Work Late or on Weekends
The Problem: If the work day ends at 5 p.m. but the majority of your team regularly stays well past, that should be cause for concern. This indicates that your team members are either juggling too many responsibilities or managers have unrealistic expectations for their direct reports. Quotas help ensure your growth plan stays on track, but impractical objectives can lead to employee burnout.
The Fix: To avoid unnecessarily overworking your employees, talk to managers about reassessing workloads. Ensure every individual has enough responsibilities to be challenged and productively contribute to business success without leading to burnout. You may also need to evaluate the entire team’s demands — if every individual is running ragged at work, there may be room to hire another employee to share the workload.
14. Candidates Are Judged for Culture Fit
The Problem: Of course you want every member of your team to feel like they belong in your company culture, but hiring for culture fit is an outdated recruitment strategy that will cost you top talent. When you seek out carbon copies of your current employees, your culture will remain stagnant or start to decline. Like-minded individuals are great at agreeing, but tend to butt heads when it comes to pushing the envelope.
The Fix: Start to hire for culture add. This approach ensures that you bring on candidates who will connect with your team on a meaningful level. Culture adds are individuals who share your core values and are passionate about your mission but bring a unique background, perspective or experience to the team. Following this strategy helps build a diverse and inclusive culture where individuals from all walks of life are welcome.
15. Teams Are Siloed
The Problem: Lack of communication is a solid indicator that a company has a toxic culture. Across teams or between managers and direct reports, the way information does or does not flow can impact a company’s culture as well as its bottom line. When employees aren’t communicating properly, it can hurt productivity, stifle ideas and create a less desirable working environment.
How to Fix It: Launch team building activities and company-wide initiatives to get teams talking and working together, even if it’s not work related. Breaking down these initial walls between teams and even within teams can help information flow better when it comes to everyday work. Additionally, creating open-door policies at the leadership level can work wonders for communication. When engagement and transparency are encouraged from the very top, information is less likely to get trapped. It can be difficult to abandon the styles of communication cemented in a company’s foundation but it’s worth the work.
16. DEI Policies Are Nowhere to Be Found
The Problem: In this day and age, not having an active and effective way to recruit, hire and retain women, gender-fluid people and people of color — and a workplace culture that embraces diversity — smacks of corporate ignorance and contributes to a toxic work culture. Like not having a corporate giving culture, it telegraphs to employees that management just doesn’t care.
The Fix: Get your HR team together, hire a workplace consultant if need be, and then draft and enact a diversity, equity and inclusion policy. When you write workplace policies designed to keep all employees feeling safe at work, keep in mind the saying: Nothing for us, without us. Engage BIPOC employees as well as LGBTQ+ employees. Publicize the policy to employees and present it as a living document, encouraging them to suggest improvements.
Fixing a Toxic Company Culture
Your company culture isn’t a one-and-done deal. Even after you address these 16 signs of bad company culture, you should routinely check in on your organizational culture and see what improvements can be made. You can gauge the strength of your company culture by measuring employee engagement and regularly asking your team for feedback.
There are also a number of ways for employers to be proactive about promoting positive company culture. For example, set aside time for activities like team lunch or ice breakers that give people a chance to step back from their regular duties and get to know other people on their specific team or in other departments. Remember that your hard work will pay off in the long run, so don’t shirk your company culture responsibilities.
Lisa Bertagnoli contributed reporting to this story.
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