When you think of the kind of environment you want to work in, is it supportive, positive and motivating? Or is it cutthroat, catty and stagnant? Odds are, an office culture like the second one would make anyone want to run for the hills.
Much has been written about the Great Resignation, which refers to the ongoing exodus of employees from their jobs that has been hitting many different industries the past few years. An analysis of Culture 500 companies from MIT Sloan Management Review shows that toxic company culture is the main driving force behind the phenomenon, and it’s even 10.4 times more important than compensation - a surprising finding when dissatisfaction with pay is often attributed to be the main reason why employees leave to seek greener pastures.
Company culture contributes to the mental and physical wellbeing of an organization’s team members, and a toxic one is a recipe for disaster. The flipside is a positive, healthy company culture that gives all team members the chance to thrive, grow and feel fulfilled in their work.
Unfortunately, toxic work culture is more common than you might think. Between 2016 and 2020, 10% of American workers at large companies mentioned at least one element of toxic company culture in their Glassdoor reviews.
So what is toxic company culture? The definition is somewhat fluid, as priorities, values and principles vary from company to company. Something that might not go over well at one organization may be par for the course at another. But there are a few key indicators that a workplace culture might be toxic, and not a great environment for employees to thrive.
Here are 10 signs of toxic company culture to look out for.
Failure to recognize good work
We all want to be appreciated for a job done well. High-performing employees are going to start to feel burned out if they consistently go above and beyond expectations, bring solutions, and make a difference to the company with little or no recognition of their efforts. It can be difficult for management to recognize every single area where an employee shines, but it’s important that a concerted effort is made to show employees that they are valued and appreciated for their contributions to the organization. Without adequate recognition, valuable employees may feel less motivated to stay in the job, and eventually have one foot out the door, seeking an environment where their work will be rewarded and appreciated.
Too much competition
It’s also not a great sign if employees are pitted against each other or if there’s an unhealthy amount of competition. Workers should be recognized for their hard work and valuable contributions on their own merit, not just relative to others on the team. A particular level of competition can certainly be motivating, but too much can lead to a toxic work environment where people feel like they are going up against each other rather than working toward the same goal or mission.
There might be days that are so busy that when lunch time rolls around, you have to order UberEats to nosh on a salad at your desk. But if a workplace consistently has a lack of respect for breaks and employees are regularly encouraged to work through lunch, it could be a sign of a toxic company culture. Lunch breaks are important. A survey of North American employees found that workers who take lunch breaks are more productive, engaged in the work, and likely to continue working at the same company, as well as recommend the company to others.
When taking time to fuel up, or even taking another kind of break like hitting the bathroom or going for a walk, is either outright discouraged or generally frowned upon, it doesn’t make for a very positive company culture. All team members must feel the psychological safety to make good choices for their physical and mental health throughout the workday.
No work-life balance
In addition to breaks, time truly off the clock is essential to recharge and for people to be well-rounded human beings, and to tend to the other responsibilities or interests in their lives. A company where employees are frequently contacted after hours or on weekends, or it’s expected to work past one’s regular shift, could have some elements of a toxic culture. It could mean that employees’ time isn’t respected, or that they have too much on their plates to accomplish it all in the regular workday.
It could also be breeding an overly competitive and cutthroat culture in which employees are working longer and longer hours and burning themselves out. While hard work and dedication are valuable traits in any team member, if overexerting oneself or taking on too much work is glorified, it’s a recipe for toxicity. Boundaries are important in any positive company culture, and even the most high-performing employees need time off the clock.
Discriminatory or noninclusive
Regardless of the company, this one is non-negotiable. If not all employees are equally respected on the basis of gender, race, age, sexuality or religion, it’s not possible for a healthy, inclusive and diverse workforce to thrive. According to another MIT Sloan Management Review analysis, identity-related topics such as these are a major predictor of whether or not employees view a company’s culture as toxic.
Another element of this is inclusion in general. A workplace that’s described as “clique-y” might bring to mind visions of school cafeterias, with clearly divided subgroups and potentially catty reinforcement of such groups. This can play out in a corporate setting with managers playing favorites or providing unequal opportunities at promotions or other perks. Not exactly a place where the typical person would want to go work at every day.
You want an environment where everyone brings something new to the table. A workplace where everyone is just like each other will lead to stagnation. Innovation requires different ideas and backgrounds, and an inclusive environment helps foster this.
Lots of gossip or drama
Another sign of toxic company culture is constant drama. As the old adage goes, you catch more flies with honey than with vinegar. If gossip is always fueling the rumor mill in a workplace or if pettiness and cattiness abound, it can detract from the task at hand: doing great work and being part of a team. With different personalities, it’s normal for team members to occasionally have varying levels of disagreements. Not everyone has to like each other, but respect and trust are essential. It’s difficult to focus on work and perform to the best of one’s ability when the workplace is filled with tension, rumors and toxic behavior.
It can sometimes be difficult to immediately pick up how people in a workplace truly treat each other, but there are signs about the strength of the interpersonal relationships within a workplace. If eyerolls, silence and scowls seem to be more prevalent than smiles, greetings and friendly chit-chat, it could be a sign that employees are not particularly kind or respectful of one another. Some days at the office might be more stressful than others, but overall, it’s a great sign when workers seem happy to be working there and interacting with each other, and it’s a red flag when the overall vibe is more “dark cloud” than “sunshine and blue skies.”
Lack of communication
Communication is a crucial element for any team to run smoothly. In a healthy workplace culture, team members must trust each other and have strong lines of communication rather than just hearing about things through the grapevine. If people feel out of the loop or are unclear on their responsibilities, it can lead to dysfunction, a lack of direction, or a “too many cooks in the kitchen” effect, all of which can make it more difficult to get things down and quickly begin to feel like a toxic culture.
It’s also not a great sign if communication only appears to flow one way, with managers giving information or directives to employees without allowing everyone the chance to ask questions, make suggestions or give feedback. Communication should be encouraged at all levels, whether it’s managers being transparent so everyone is in the loop or employees being vocal about their ideas, challenges or questions so that everyone on the team has a voice.
High employee turnover
Employee turnover refers to the rate at which employees leave a job either voluntarily (such as for another role) or involuntarily (being let go by the organization). And it’s costly for an organization. The time and costs that go into onboarding and training new employees are incurred repeatedly when workers are leaving the company at high rates, and it lowers employee morale. (Companies might feel the cost of a toxic culture even before it gets to the point of workers quitting. Employees wanting to avoid a toxic environment might be more likely to show up late or call in sick.)
Do you need an employee retention policy? Check out our guide on how to create one here.
A company with high employee turnover means that people are not staying at the organization long, and it could be a sign of toxic company culture, especially if team members are leaving of their own volition. Sure, employees could just be leaving to pursue other opportunities or paths, but it could also indicate that the company is doing something to drive employees away, or not doing something that could get them to stick around.
New hires always from outside the company
It can be great to infuse fresh ideas, talents and skillsets into the workplace with outside hires, but if managers are consistently not promoting from within, it can lead to a toxic culture. Current employees might begin to feel less motivated if they feel like their work doesn’t contribute to their chances at a leadership role in which they’re interested, or if there’s no path forward with the company.
A mentorship program is a big indicator that a company cares about the internal growth and advancement of employees. If such a program doesn’t exist at a company, or if there is generally no encouragement or path toward growth or new challenges within the organization, it could lead to a toxic environment where employees don’t feel valued, challenged, or like they have direction. This can be especially hard on new hires who are still learning or members of marginalized communities who are already facing other hurdles in feeling supported at work.
Policies over people
Guidelines, values and standards are important for an organization to run smoothly and operate at a level of excellence and productivity. But it should never be forgotten that the company is made up of human beings, who are likely to make mistakes every once in awhile. If the ship is run too tight, it could breed a culture of fear that is too overly focused on discipline and rigidity. A culture where even minor mistakes are swiftly punished or outwardly criticized is likely to create a toxic environment where employees will do anything to avoid blame, even avoiding responsibility or throwing their teammates under the bus.
As long as it’s not a consistent pattern or an ongoing issue with performance that needs to be addressed, it’s important for team members to be given some grace. Employees must feel comfortable expressing themselves and taking risks, and an inability to do so could signify a toxic company culture.
No one wants a toxic relationship, friendship or workplace. There are several signs that a company culture might be toxic. But the good thing is there are numerous ways to ensure a healthy, thriving workplace with less of the elements we discussed above.
How to avoid toxic company culture
- Make sure core values are clear.
- Ensure all employees are treated equally and with respect.
- Have team-building activities to foster good relationships and encourage communication.
- Encourage work-life balance.
We can all play a role in making our company culture a positive and healthy one, but the tone is first set by leadership. It’s important to avoid these indicators of toxic company culture so that all team members feel equipped to grow and succeed at the organization for a long time.