in business

A toxic worker’s damage can outweigh the benefits of a superstar employee

Nicole Torres, writing for HBR in 2015, about a paper by Dylan Minor and Michael Housman:

They compared the cost of a toxic worker with the value of a superstar, which they define as a worker who is so productive that a firm would have to hire additional people or pay current employees more just to achieve the same output. They calculated that avoiding a toxic employee can save a company more than twice as much as bringing on a star performer – specifically, avoiding a toxic worker was worth about $12,500 in turnover costs, but even the top 1% of superstar employees only added about $5,300 to the bottom line.

The real difference could be even bigger, if you factor in other potential costs, such as litigation fees, regulatory fines, lower employee morale, and upset customers. One 2012 CareerBuilder survey found that 41% of the nearly 2,700 employers surveyed estimated that a bad hire could cost $25,000, while a quarter believed it was much higher—$50,000 or more.

As we’ve seen over and over again in recent days, companies often value the skills of high performers at the expense of all other beneficial characteristics. This comes to cost them dearly when their superstar employees turn out to be toxic workers.