Why a Workplace Bully is too Expensive to KeepThe most powerful argument you can make to get rid of a workplace bully is to build a financial case for why the person is just too expensive to keep. Surprisingly, it is a strategy that is rarely, if ever, used and cost of bullying calculators are hard to find. I have put together my own for you to use.

A financial case will take some time to prepare and requires due diligence in collecting the evidence. However, it trumps an emotional argument every time.

The person you should present your case to is almost always not the HR manager, but the person actually responsible for making financial decisions. You must go straight to the top and bypass the usual channels. To do this you will need to ensure you have built a good working relationship with the power broker in your company. If the bully has already established a good relationship with this person, negotiating around that can be tricky.

Quite often in bully-prone organizations, there is an official organizational hierarchy, and then there is the shadow hierarchy. As part of your research, take the time to work out the shadow organizational chart depicting who the real power brokers are. For example, if the receptionist is sleeping with the CEO, then she may be much higher in the power hierarchy than her prescribed role in the official chart suggests.

By mapping who really has the power, if the person making the decision is not available to you, then the next best person to discuss your case with will be the one who holds the most influence with that person. You may not be a political animal, but the bully is, and now it’s time to play the game a little outside of your usual parameters.

One word of caution, though: Be prepared for the organization not to care about the bottom line, the cost of keeping the bully. It always astonishes me when a company, which touts that profits for shareholders trump every other consideration, doesn’t seem to care about this aspect of their bottom line. But it does happen.

Sometimes the denial and the accompanying arrogance runs so deep that there is no room for the truth to shine a light through the cracks. If that describes your workplace, you should give serious consideration to planning an immediate exit to safeguard both your physical and mental health.

A great example of a powerful financial argument can be found in Bob Sutton’s 2007 book, The No A**shole Rule. In it, he described a case in which a Silicon Valley tech company had an employee, Ethan (not his real name), who was consistently in the top five percent of sales performers. Unfortunately, he also regularly insulted and belittled coworkers, many of whom refused to work with him.

Within the space of five years, several co-workers had lodged “hostile workplace” complaints about him. To the company’s credit, they did take action to remedy the problem. They quantified the costs of his bad behavior over a year and deducted it from his bonus. It amounted to a total of $160,000.

The costs were actually underestimated, though, because they didn’t include all the fallout from his behavior such as the physical and mental health effects on victims, time lost, impact on witnesses, negative effects of fear and the dysfunctional competition he provoked. However, the “Total Cost of A**holes” (TCA) was calculated as follows:

Time spent by Ethan’s direct manager – 250 hours: $25,000
Time spent by HR professionals – 50 hours: $5,000
Time spent by senior executives – 15 hours: $10,000
Time spent by external consultants – 10 hours: $5,000
Cost of recruiting and training new secretary: $85,000
Overtime costs of Ethan’s last-minute demands: $25,000
Anger management training and counselling: $5,000
TCA for one year: $160,000

Now, imagine that you had your own argument that was even more powerful than that. I hope that the formula suggested below will give you a good starting point.

One in two workers witness bullying and 20 percent of witnesses leave their jobs. For every case reported, eight to 20 cases go unreported. Forty-four percent say that organization does nothing to resolve the issue and 18 percent say the organization has made the situation worse.

Over 70 percent of bullies are managers, yet they are often protected because (like Ethan) they are perceived to be high-value employees. In almost 50 percent of cases, bullying has gone on for more than a year and 30 percent of all bullying is mobbing (where a person is targeted by a group of bullies rather than just one). (Faure Brac, 2012).

Using these statistics as an a priori assumption, let’s use the example of a small business with 10 employees (each with a $50,000 per year salary) that turns over $1,500,000 per year. Let’s also assume the following:

The cost of employing staff is 1/3 x $1,500,000 = $500,000

Business expenses are 1/3 x $1,500,000 = $500,000

Business profits are 1/3 x $1,500,000 = $500,000

There is one bully in the team of 10.

Thirty percent of the staff is bullied = three employees directly affected

Two remaining bullied employees now work at 40 percent productivity due to “presenteeism”

Five employees witness it

Turnover is 1 target and 1 witness quit (but problem remains).

Lost productivity within the team means the remainder now work at 70 percent capacity. This is a conservative estimate based on the “soft” costs to business, that are not as easily gauged in a concrete way, but include:

  • Less innovation and creativity
  • Less constructive ideas and feedback
  • Less learning from mistakes
  • Less forthright discussion / honesty
  • Less motivation and energy
  • Reduced cooperation and cohesion
  • Employee potential blocked
  • Increase of physical and mental illness
  • Cost of retaliation
  • Management resources to deal with the bullying
  • Burnout (physical and mental)
  • Medical expenses
  • Loss of reputation
  • Failure to attract best and brightest staff
  • Less customer satisfaction
  • Less repeat business and referrals

Total loss of productivity within the remaining team (eight members) = -43 percent.

In addition to calculating the cost of bullying, you may also want to make your case even more powerful by demonstrating how much more profitable mentally healthy workplaces are.

In fact, profitability has been shown to increase by 230 percent. A groundbreaking study conducted by a Beyond Bullying Australia and Price Waterhouse Coopers collaboration demonstrated that for every dollar spent on implementing successful actions to improve mental health, there is on average $2.30 in benefits to be gained by the company.

Other benefits were improved productivity, via reduced absenteeism and presenteeism as well as lower numbers of compensation claims. When multiple targeted actions were implemented, the effects were cumulative and there were further increases in return on investment.

Productivity gains from different actions varied depending on the company’s industry and size. Actions were more effective in smaller companies because the most critical success factor was employee participation. In large companies, actions were best implemented within distinct teams.

However, leadership and management support were crucial for effective implementation, and when it was present, there were substantial improvements in workplace mental health and culture.

 

APA Reference
Henshaw, S. (2014). Why a Workplace Bully Is Too Expensive to Keep. Psych Central. Retrieved on November 27, 2014, from http://psychcentral.com/lib/why-a-workplace-bully-is-too-expensive-to-keep/00019944
Scientifically Reviewed
    Last reviewed: By John M. Grohol, Psy.D. on 16 Jul 2014
    Published on PsychCentral.com. All rights reserved.

 

 

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