We’ve all experienced the colleague who brings the mood down, the boss who thrives on chaos, or the team member whose negativity drains the energy from the room. A toxic workplace environment is caused by the toxic behaviour of employees and affects organisations around the globe. But what may not be obvious is the significant hidden cost of a toxic workplace.

On episode 122 of The Science of Personality, cohosts Ryne Sherman, PhD, and Blake Loepp discussed what behaviours make an employee toxic, how personality is related to toxic behaviour, and ways to respond to toxic workplace environments.

“Inadvertently creating a toxic culture does have long-term consequences and long-term damage [for organisations] because it’s going to be really difficult to change,” Ryne said.

Who Is a Toxic Employee?

When we’re talking about toxic employees, we’re talking about people who behave in such a way as to create a toxic workplace environment. In other words, people aren’t toxic, but bad behaviour at work is.

Also called counterproductive workplace behaviour, toxic behaviour at work can take many forms. Sabotage, misinformation, harassment, theft, hostility—a toxic workplace environment actively hinders other people’s safety or productivity. Ryne elaborated: “People feel they don’t have psychological safety or as if they are under threat all the time. That doesn’t just come magically out of the air. It’s coming from the people who are engaging in the toxic behaviours that are creating that toxic workplace.”

Assessing Toxic Behaviour

Toxicity has no single personality profile. Many types of behaviour can create a toxic work environment. To develop our technical brief about toxic employees, Hogan research staff reviewed literature on behaviour that contributed to a toxic environment at work. Being discriminatory, manipulative, narcissistic, impulsive, and aggressive were all identified as toxic behaviours, among others. We then connected those behaviours to Hogan competencies, such as self-management, accountability, and caring about people.

Many different combinations of Hogan scale scores can indicate the potential to engage in toxic behaviour. On the Hogan Personality Inventory (HPI), low Adjustment is related to misusing information and expressing hostility. Low Ambition is related to poor work quality. High Sociability is related to alcohol use in the workplace. Low Prudence is related to stealing from the workplace, drug use in the workplace, inappropriate speech, and physical aggression.

The Hogan Development Survey (HDS) also has many scales associated with toxic behaviour. High Colourful is associated with destruction of property, alcohol use at work, and misuse of information. High Mischievous is associated with engaging in unsafe behaviours (no surprise there!). “If the leader of your organisation is engaging in dangerous behaviour at work—driving the forklift wildly, let’s say—that sets the standard. That creates this workplace environment where others see that behaviour as acceptable,” Ryne explained.

Reasons for Toxic Workplace Behaviour

Some people engage in toxic behaviour at work because the workplace environment encourages it. Leaders or peers are engaging in those behaviours (yelling, gossiping, loafing, etc.), so they become the norm. The toxic employee assumes this is just how work gets done here.

Others might think what they’re doing is entertaining to or appreciated by their coworkers. They may even think they are fulfilling expectations. A toxic manager could mistakenly believe that yelling is a great way to hold people accountable. “The feedback that you are not getting the results you want can be an important step toward changing your behaviour,” Ryne said.

The Cost of Toxic Employees

Hogan has estimated that approximately six percent of the global workforce can be categorised as behaving in a toxic manner. Hogan has also estimated that US companies could save $292 billion in 2025 by avoiding toxic hires.

• The total cost of one toxic employee – We drew on research that analysed salary, benefits, and rehiring, as well as soft costs, such as others experiencing burnout or quitting.¹ “You would have to hire four superstars—top five percent employees—to make up for one toxic employee’s cost,” Ryne said. Superstars bring in revenue, but toxic employees cost their total compensation plus soft costs.
• The percent of toxic employees across organisations – We analysed our personality research database to identify the cluster of toxic behaviours: aggressive communication, manipulating others, discriminatory behaviour, and violating norms, plus many others, including indirect aggression in remote work settings. “We found that about six percent of people who take our assessments were really hitting on all of these behaviours,” Ryne said.

When you combine the six-percent figure with the cost of a toxic employee and total wages in the US, the total cost of toxic employees is about $292 billion per year. The companywide impact of toxic leaders can include disengaged shareholders, damaged brand reputation, and low employee engagement, productivity, and retention. Especially when you consider the soft costs of toxic leaders, those financial consequences can even start to seem small.

Responding to a Toxic Workplace

Employees, leaders, and organisations each have different options for safely responding to toxic employees. “It’s incumbent upon managers to spot that toxic behaviour first and address it with that person,” Ryne clarified.

• Employees can report toxic behaviour to their managers or HR. Of course, for an employee to take this action requires psychological safety. Another response that many employees choose is to leave the toxic workplace environment.
• Leaders and managers set the culture for their teams, departments, and organisations. They must be accountable for team performance and not allow toxic employees to continue that behaviour. Intervention can begin with a conversation and may proceed to HR collaboration, coaching and development, or termination as appropriate.
• Organisations can recognise a toxic culture and take steps to change their values. They can use a high-quality personality assessment to help identify potential for toxic behaviour during the hiring process.

Potential red flags should be considered alongside a candidate’s other skills, talents, and qualities. In considering the trade-offs, Ryne said that potential toxicity can be mitigated with feedback, coaching, 360 assessments, and a culture of psychological safety where toxic behaviour is seen and addressed.

“There’s no perfect way to predict if this person is toxic and this person isn’t, particularly when we’re talking about six percent,” Ryne said. “What we can do is identify patterns of behaviour that are more likely to be toxic to best inform decisions from a personnel standpoint.”

Listen to this conversation in full on episode 122 of The Science of Personality. Never miss an episode by following us anywhere you get podcasts. Cheers, everybody!

*This article originally appeared on Hogan Assessments.