A toxic work culture is the biggest reason why people quit, and it's 10 times even more important than pay, according to research published in the MIT Sloan Management Review. But what exactly does a toxic workplace actually look like?
Researchers analyzed 1.4 million Glassdoor reviews from nearly 600 major U.S. companies and found employees describe toxic workplaces in five main ways: non-inclusive, disrespectful, unethical, cutthroat and abusive.
"Employees can have hundreds of different criticisms about their organization that they discuss on Glassdoor," from IT problems to clueless management, says Charlie Sull, a researcher on the analysis. "Most won't have a powerful emotive effect on their assessment of the organization, but we're looking at a small sample of topics that do have a large effect on a company's Glassdoor rating." Those same factors can cost companies billions of dollars in employees quitting.
For their analysis, researchers focused on topics repeated in employee reviews that correlated with both a negative score on the company's culture score and high attrition rates from April to September 2021.
"These aren't just mere annoyances," Sull says. "These are the things that'll cause an emotional reaction that'll make you dread going into work."
Based on anonymous reviews, employees say the following five descriptions are textbook elements of a toxic work culture:
- Non-inclusive, where members across gender, race, sexual identity and orientation, disability and age don't feel they are treated fairly, welcomed or included in key decisions. Researchers caution that though these identity-related topics might not apply to all employees, they have a big impact. For example, "respect" is mentioned 30 times more frequently in employee reviews than LGBTQ equity, but both topics have the same impact on an employee's view of culture when they are discussed negatively in a review.
- Disrespectful, or lacking in consideration, courtesy and dignity for others. The researchers' previous work found respect, or the lack thereof, was the single strongest predictor of how employees as a whole rated the corporate culture.
- Unethical behavior, including descriptions of the organization being dishonest or lacking regulatory compliance, including with Occupational Safety and Health Administration standards, which protect workers' safety, and the Health Insurance Portability and Accountability Act, which protects sensitive patient information.
- Cutthroat or backstabbing behavior and ruthless competition. Nearly 10% of employee reviews noted poor collaboration at their company, which didn't have a huge impact on turnover. But what did correspond with low culture scores and higher turnover was employees saying that their office was "Darwinian" or that colleagues often "stab each other in the back."
- Abusive management, including bullying, harassment and hostility. Nearly one-third of Glassdoor reviews discuss management in general, but 0.8% described their manager as abusive.
When people quit due to a toxic work culture, it's as much of a human cost as it is a business one.
Employees who work in toxic environments have higher levels of stress, burnout, mental health issues and other stressors that can lead to poor physical health.
The Society of Human Resources Management estimates that 1 in 5 employees have left a job at some point in their career because of a toxic culture, which cost businesses more than $44 billion per year prior to the Great Resignation.
Disengaged and job-searching employees means lower productivity, and replacing an employee can cost up to twice the employee's annual salary, according to Gallup.
With the business world focused on retention and hiring these days, researchers on the MIT analysis say organizations must set up and model a supportive, inclusive culture as the pandemic reshapes how we work.
They also recommend leaders break down how people rate company culture, like by geographic region, department, function or level of seniority, to find "microcultures" where employees don't feel psychologically safe and supported. "Even in relatively healthy organizational cultures, even a small share of people who describe the culture as toxic can drive attrition," Sull says.