Fire or Keep High-Conflict Employees?
© 2016 Bill Eddy, LCSW, Esq. & L. Georgi DiStefano, LCSW
For the past several years, dealing with difficult co-workers has been at the top of employee and management concerns. Yet most organizations are hesitant to fire these employees, with many of them tolerating negative behavior in hopes that they will spontaneously improve their own behavior or leave. Also, businesses often value the work that these difficult employees do – sometimes worth large sums to the company – so that they don’t want to push them away and lose their expertise.
Now, a new study out of Harvard addresses the actual costs to a company of firing or keeping such employees, with surprising results. This article looks at some of the traits of “toxic” employees and our suggestion that specialized coaching may help in deciding whether they should stay or go.
Who are High Conflict Employees?
In our book It’s All Your Fault at Work: Managing Narcissists and Other High-Conflict People (2015), we defined high-conflict employees as having a pattern of four key traits:
Preoccupation with blaming others
Lots of all-or-nothing thinking
Unmanaged emotions (in some cases, not all)
Extreme behaviors (stealing, spreading rumors, bullying, assaults, etc.)
These traits often overlap with the characteristics of people who also have traits of personality disorders (although not necessarily a full personality disorder). This means that they have:
Repeated internal distress or interpersonal problems
They lack self-awareness of the role they play in creating their own interpersonal problems
They generally don’t change or improve their behavior, but instead defend it vigorously.
In their new study, described in a paper they are circulating in draft form titled Toxic Workers – Working Paper No. 16-057 (Harvard Business School, 2015 – available from the authors), authors Michael Houseman and Dylan Minor describe “toxic” behavior specifically as follows: “a toxic worker is defined as a worker that engages in behavior that is harmful to an organization, including either its property or people.” This ranges from low employee morale, to losses of billions of dollars, to large legal fees, to loss of life.
They studied over 50,000 employees in organizations with an approximately 5% termination rate for toxic employees. They concluded that it saves a company approximately $5300 to hire a superstar employee, but saves a company approximately $12,500 to avoid a toxic employee - either by firing them, not hiring them in the first place or by “converting them to an average employee.”
They found that the following factors were helpful in identifying toxic workers. We briefly describe some of their conclusions below, with our comments and related suggestions for managers and organizations.
The researchers looked at the extent to which employees showed concern or empathy for other employees in comparison to themselves. They found that those with high self-regard had less concern for their colleagues needs and less concern for company property. They observed that toxic employees are often those who “do not fully internalize the cost that their behavior imposes on others.” Therefore, they were more likely to be terminated.
Our comment: An inflated self-regard and lack of empathy are two of the characteristics of narcissistic personality disorder. These traits cause one to devalue the team, community or group that help to achieve the goals the narcissist is so proud of. Narcissists also show more willingness to insult or demean their co-workers and managers – and to work less hard than others but to claim more credit than they deserve. Thus, these traits seem helpful to recognize as early in the process as possible. However, narcissists can be very charming and impressive until you really get to know them (in a challenging situation, deadline or mutual project), so that they are often easily hired by managers who don’t realize what their work responses will really be on the job. Yet looking for this trait often helps in the hiring process, when weeding out applicants who give hints of being arrogant or self-involved.
Compared to average employees, the researchers found that toxic employees over-rated their skills. They were given a computer skills exercise and told to rate their proficiency – and they consistently over-rated themselves compared to their actual scores. One result of this trait was that these over-confident employees were more likely to engage in misconduct – perhaps because they were confident that they could get away with it. Overall, they found that overconfidence also indicated a higher likelihood that the person would eventually be fired.
Our comment: While this characteristic fits those with narcissistic personalities, it also applies to those with some traits of antisocial personality disorder. These individuals (also known as sociopaths) are some of the most commonly involved in workplace misconduct. Those with antisocial personalities are generally comfortable lying, stealing, spreading rumors and hurting others to accomplish their own goals. A strong characteristic is a lack of conscience. (Think of Bernie Madoff.) This is often difficult to identify in the hiring process, but it helps to have a healthy skepticism and seek verification for information the applicant may provide – especially tales of being treated poorly by others while their own behavior was without blemish.
Statements about Following Rules
One of the most surprising, counter-intuitive aspects of this study was the finding that employees who reported a strict belief that one should always follow the rules was actually a trait of employees who eventually were let go. The reason for this appears to be that the average employee reports that there are times when one shouldn’t follow rules and is honest about that in their applications. The toxic employees were the ones who appeared to say whatever it would take to get the job, including that one should always follow the rules.
Our comment: This is another type of question which raises the possibility of narcissistic and/or antisocial personalities. Since they frequently and comfortably exaggerate or lie, they may be the ones most likely to say whatever it takes to get a job. Beware. However, one should be cautious about making major hiring decisions based on this type of question alone. Many sincere and average employees may interpret the question more broadly as being about one’s personal goal to follow the rules, while realizing there are exceptions to most rules.
Exposure to Other Toxic Workers
The study did conclude that other toxic workers could tip one toxic worker toward more misconduct. This was more pronounced where there was little supervision and the worker was around the co-workers a fair amount of the time.
Our comment: This result fits with our observation that high-conflict people in general will misbehave more when there are others around them who will justify and defend the high-conflict person’s behavior. They are constantly seeking this type of encouragement, and there are often a few of what we call “negative advocates” involved with them. Negative advocates usually do not have personality disorders, but have become emotionally hooked into the drama. The presence of these negative advocates usually encourages them to act on their impulses, which is one of their big problems. Likewise, a more positive environment with consistent limit setting may assist them in acting better.
Another important surprise from this study was the fact that toxic employees can be just as productive as or more productive than average employees in terms of the amount and speed of their work. In other words, they can be productive employees in terms of numbers. But in terms of the quality of their work, they consistently had lower quality than their average co-workers. The researchers concluded that it was still beneficial to the organization to terminate such employees rather than to keep them on simply because they had good productivity numbers. Yet they observed that many toxic workers tend to last a long time in the organization because they are so productive.
Our comment: This finding is significant because one of the dilemmas of managers and organizations has been: What to do with the productive, but negative, employee? Fire or keep? This research seems to suggest that it’s not worth keeping them, regardless of how productive they can be. There still was a cost savings of $12,500 in avoiding such employees or converting them into average employees. While terminating may be appealing and the right course of action in many cases, many employers have specialized employees (such scientists, doctors, lawyers, etc. with some misconduct), such that assisting them with coaching, as we describe below, can be a preferable course of action.
Personality More than Situation
Another conclusion the authors reached was that the personal characteristics that employees brought to the job – essentially their personalities – were more important than characteristics of their environment, in approximately a 70% - 30% ratio. In other words, their personalities coming into the job are an important factor to consider in screening, rather than assuming that characteristics of the job create or solve the most problems. With the factors they identified above, they suggested that managers could become more effective at screening out toxic employees.
Our comment: As we said at the start of this article, we focus on the issues of “high-conflict” employees in our work (consulting, training and writing). Organizations tend to misunderstand these employees and often make matters worse by ignoring their misconduct or angrily challenging them without consistent limit setting. Since many of them have personality disorders or traits, they need a different approach. Some need to be removed from the organization sooner rather than later. Others may be “converted” – as these researchers termed it – into more appropriate employees.
In order to help those with potential to improve, we have developed a coaching method called New Ways for Work, which we describe below. In some cases, this can make a huge difference in the employee’s behavior, while in other cases it makes no difference. We believe that trying this approach can help an organization intervene much earlier when problems first arise and have the most potential for improvement, and then to assist in determining who to fire and who to keep by observing whether the employee has been able to make sufficient changes.
New Ways for Work Coaching
New Ways for WorkSM Coaching involves 3-12 sessions with an Employee Assistance Professional, a therapist or an outside coach. This method uses a workbook to structure the coaching process around strengthening four key skills for the employee: flexible thinking, managed emotions, moderate behaviors and checking oneself (rather than blaming others). It includes discussion exercises with the coach and writing exercises. By focusing on these four key skills, there can be a lot of repetition and reinforcement of new behavioral responses.
From our experience, employees begin to value these skills because they can use them with their families and in other settings, as well as in the workplace. They can help with customers, co-workers, employees and managers. Within each of the four key skills are smaller skills, including: giving oneself encouraging statements to stay calm; writing emails and letters that are brief, informative, friendly and firm; making and responding to proposals respectfully to solve problems large and small; and setting limits with empathy, attention and respect.
This approach shifts the focus away from overly analyzing problems or blaming others (two common problems with high-conflict people in counseling settings), so that the employee is learning skills which can be used right away in manageable ways. It is also brief and structured, so that the cost is limited and the client is less resistant to learning skills. We have found this approach to be surprisingly satisfying to clients, who get a sense of empowerment and hope – while behaving more reasonably in many cases.
Given the issues identified by the study described above, we believe that many potentially high-conflict or “toxic” employees may be able to be converted into average employees in many cases, if they can be reached at the earliest signs of difficulty and assisted in this structured, but positive intervention. We hope that this approach can be studied at some point to see what the cost savings might be when compared to simply firing or ignoring the misconduct of these employees.
Bill Eddy is a lawyer, therapist, and mediator. He is the co-founder and Training Director of the High Conflict Institute, a training and consultation firm that trains professionals to deal with high-conflict people and situations. He is the author of several books and methods for handling high conflict personalities and high conflict disputes with the most difficult people.
L. Georgi DiStefano is a best-selling author, international speaker, Licensed Clinical Social Worker, and the recipient the Lifetime Achievement Award from the National Association of Social Workers San Diego chapter. She has extensive experience in the management of substance abuse programs and employee assistance programs, as well as workplace conflict resolution.