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How to Appropriately Manage Toxic Employees

Published November 08, 2016 (last updated November 17, 2020) -

Workplace culture has a tremendous effect on employees, both in a positive and negative light depending on the type of culture present.

Many things come into play when talking workplace culture, but a huge facet is your people. The right people can add to a positive and nurturing culture, whereas negative people can be toxic, leading to a decline in productivity, overall culture and in more severe cases, loss of great staff and/or claims of bullying or harassment.

Employsure often receives calls from clients who are faced with a toxic employee and are unsure of the steps they can take to counteract the behaviour, or in some cases, remove the person responsible. If your workplace is struck by a toxic employee, do not ignore it. Leaving a toxic employee to run rampant throughout your workplace will ultimately impact your business success. There are ways to mitigate this risk so you do not find yourself in any of the negative scenarios mentioned above.

The most crucial factor when dealing with a toxic employee is to ensure you have policies and procedures in place outlining what is deemed as acceptable behaviour and what will not be tolerated in your workplace. While workplaces can vary in what is acceptable or not, by clearly stipulating it in writing, and by providing each and every employee with a copy of all policies and procedures, you can address non-adherence as soon as it presents, and with full confidence.

Toxic employees can take many different forms. Below we have identified the main culprits, while identifying appropriate ways to manage them.


Bullies should not be tolerated in any workplace and an anti-bullying policy will clearly outline what constitutes bullying, meaning if in breach of these guidelines, you can commence appropriate disciplinary proceedings.


Employees such as this can drag down an entire team. They may also be offloading work, placing added pressure on other members. If presented with a non-performer you have every right to performance mange them and if, upon completion of a performance improvement plan, they do not improve you can take appropriate steps to dismiss.

Tardy or absent employees

Employees not showing up for work or taking sickies can hinder any business. Including a policy on what is tolerated and the requirements associated with taking sick days can help alleviate these concerns, particularly when implementing a policy whereby each sick day taken requires a medical certificate.

Lying about tasks and outcomes, or to customers

While this behaviour may accurately fall into the non-performer category it can also be part of a more sinister act that may require immediate disciplinary action or, depending on the severity, dismissal. Clearly advising employees during inductions and throughout company handbooks that this type of behaviour is not accepted may mitigate the risk associated.


If you believe a staff member is stealing, be sure to investigate and have supportive evidence prior to making accusations. While it can be deemed controversial, you do have the right to search someone’s person and/or belongings, and in extreme cases, implement surveillance. You must however, be sure to outline a search and surveillance policy and inform staff of any surveillance taking place.

Oversharing private and confidential company information

In some businesses, the leaking of confidential information can be extremely detrimental. While some businesses may not have such complex confidentiality requirements you can still protect your business by having each employee sign a confidentiality agreement. A Conflict of Interest policy is also a useful document as it will stipulate what can and cannot be discussed if an employee is liaising with a competitor.

Any policies, procedures and employee agreements implemented into your business must be accessible for all employees at any time. Each employee should be presented a copy during induction with details clearly explained. Asking employees to sign an acknowledgement form once they have read and understood the information provided can also help to mitigate toxic situations.

As the leading workplace relations specialist, Employsure can assist with the development and implementation of workplace policies and procedures specific to your business, so call us today on 0800 568 012.

About Employsure

Employsure is one of New Zealand’s largest workplace relations advisers to small and medium businesses, with over 5,000 clients. We take the complexity out of workplace legislation to help small business employers protect their business and their people.

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