Bullies place their personal agendas above company agendas, a move that inevitably impacts the company’s bottom line in a negative way.
Workplace bullying is estimated to impact somewhere between 25% and 50% of employees. Thus, nearly half of the working population has witnessed or experienced bullying at some point. This directly impacts productivity levels. Aside from the mental health damage to the victims of bullying, companies are now recognising that workplace bullying costs money. Loss of productivity means loss of profits.
The impact on the bottom line comes from:
- Increased absenteeism
- Increased presenteeism
- Loss of productivity
- Increased employee turnover
- Legal costs
- Counselling costs
- Spread of fear beyond the primary victim and the subsequent increase in the impact on productivity
People don’t perform well when working in high-anxiety situations. Targeted individuals feel a variety of physical and emotional stress-related symptoms, which impact their performance levels.
Absenteeism is a major cost factor in stress-related situations. In the United Kingdom, studies suggest that workplace bullying has played a role in the loss of 18.9 million working days each year. This kind of absenteeism is economically unsustainable. Royal & Sun Alliance, the largest commercial insurance company in the United Kingdom, has suggested that this has cost businesses approximately £18 billion annually, which equates to approximately 8% to 10% of a company’s profits.
Employee turnover due to bullying is also reported to be a high cost factor. Studies suggest that up to 30% of bullied employees will resign from their jobs, and 20% of those who witness bullying will also leave the organisation. Figures released by overcomebullying.org suggest that the number of employees who leave due to bullying could be much higher – perhaps as much as 70% of bullied employees leave their employers. This, in turn, comes with an economic impact to the employer. When an employee resigns, there are replacement costs associated with recruiting, hiring and training new staff.
Workplace bullying has a contamination effect. The morale of people who witness bullying drops and employees throughout the organisation suffer the effects of a less-happy work environment. Productivity levels throughout an organisation can drop swiftly due to unmonitored contamination and recovery can be difficult and costly.
Increasingly, employers are being found liable for the bullying that takes place within their organisations. Many employers are being required to pay damages to employees for physical or mental health issues, stress, lost wages and other issues associated with workplace bullying. Several high profile cases of extreme bullying in the United States and Europe in recent years have seen employers compelled to pay out millions in settlements to staff. Wrongful and constructive dismissal claims, where victims have been terminated wrongfully by a bully manager or supervisor, are on the increase worldwide as well.
Organisations are increasingly responsible for rehabilitation costs, both for the targeted individual, as well as the bully. For targeted individuals, rehabilitation includes support and counselling. For the bully, rehabilitation includes things such as anger-management, sensitivity training and counselling.
Although research has in recent years exposed some of the observable costs of bullying in the workplace, it’s estimated that the non-observable and less recognisable costs to companies and economies have barely been calculated. Researchers are beginning to widen their range of investigation of workplace bullying to include social media, stalking and mob-bullying, which will require greater collaboration between public and private stakeholders.
Workplace Bullying Institute
Harvard Business Review
SA Board for People Practice
TUC – changing the world of work for good
Dichthelabel – The Annual Bullying Survey 2019
No Workplace Bullies