Published:

01/03/2011 10:26pm

The Cost of Your Workplace Bully

Bullying costs you money.

For starters, it causes the following things to go up:
• Depression
• Anxiety
• Discouragement
• Absenteeism
• Presenteeism
• Turnover
• Vengeful activities
• Workers comp claims
• Health insurance costs
• Litigation costs

and the following things to go down:

• Quality of work
• Quantity of work
• Self-esteem
• Job satisfaction
• Company loyalty
• Customer satisfaction
• Number of customers
• Company reputation
• Relationships
• Communication
• Ability to meet goals
• Bottom line

Bullying “is quite costly, in that it (a) refocuses employee energy from productivity to self-protection, (b) results in staff turnover and burnout, (c) intensifies the use of sick leave, (d) increased medical and workers’ compensation claims due to occupational stress, (e) results in hiring costly consultants... and (f) leads to out of court settlements, legal fees and litigation. Additionally, communication and teamwork break down, and organizations lose credibility and suffer loss of good reputations” (Lutgen-Sandvik, 2003).

The cost of bullying will vary at every organization, so before going into how you can determine those costs specifically, here are some general estimates to help you wrap your head around it:

• Leymann (1990), the pioneer researcher in the topic of workplace bullying, estimated a bully can cost a single business up to $100,000 per year per target.
• A survey of 9,000 employees cited by Dr. Michael H. Harrison of Harrison Psychological Associates in the Orlando Business Journal estimated a cost of more than $180 million in lost time and productivity (Farrell, 2002).
• The Corporate Levers Survey estimated the cost of unfairness to American businesses during the past five years to be $63,738,884,783.

Bullying is unwanted, recurring, aggressive messages aimed at one or more individual, and that involve a power imbalance between bully and target. Bullying is prevalent in the workplace and invites significant damaging consequences for victims, observers, and the organization – including depression, burnout, job dissatisfaction, reduced productivity, increased absenteeism and turnover, health related stress, workers compensation expenses, lawsuits, and even a bad reputation.

Research indicates that between 30% (Jennifer, Cowie, & Ananiadou, 2003) and 53% (Rayner, 1997) of the workforce is bullied at some point in their working lives. Research also indicates that any given moment, 25% of the workforce is being bullied. That means that 25% of the workforce is being bullied while you read this article.

Costs can be broken into five separate categories:

Distraction from Tasks

The bully wreaks havoc on the organization, and as a result everyone, not just the target, are distracted from getting work done. Some of the things that keep them from working are:

• Reduced psychological safety and increased climate of fear
• Loss of motivation and energy
• Stress induced psychological and physical illness
• Impaired mental ability
• Decreased work quality and quantity
• Decreased loyalty to the organization
• Management burnout, leading to decreased commitment and increased stress
• Time spent looking for different work
• Time spent gossiping about the bully and his or her behavior
• Time spent by others consoling the target

Time Lost

Of course anytime you have to deal with employee issues it costs time and money to do the following types of activities:
• Employees and management calming and counseling victims
• Management appeasing, counseling or disciplining bullies
• Soothing victimized customers, suppliers and other key outsiders
• Reorganizing departments and teams
• Interviewing, recruiting, and training replacements for departed victims, witnesses and bullies

Tangible Costs

Tangible costs include:
• Lost customers who were victimized by the bully
• Lost customers who heard about the bully from unhappy former customers
• Anger