Despite your best efforts in recruitment, some toxic leaders will still make it into the organisation, or worse, develop toxic behaviours over time. They might hit KPIs or bring in strong sales numbers, which can disguise the harm they’re doing underneath. But the cost of keeping a toxic manager is steep, with high turnover, increased sick leave, poor morale, and even legal risks.
This blog outlines how to spot toxic leadership from the inside and what to do about it before it causes long-term damage to your people and your culture.
Watch Key Metrics for Red Flags
Often, a toxic manager’s impact shows up in cold, hard numbers:
- High turnover within their team
- Excess sick leave or psychological injury claims
- Increased use of Employee Assistance Programs (EAPs)
- Frequent stress claims or grievances
- Lower employee engagement scores in team surveys
- Drop in internal promotions or development opportunities within the team
- Only serious incidents or injuries being reported
If one department or team stands out on these metrics, investigate further. These red flags don’t just happen in isolation. Toxic leadership leaves a footprint you can measure.
Listen for Informal Warning Signs
Not every warning sign appears in a report and you will need to pay attention to the mood in the team.
- Staff avoid social interactions
- Team members appear anxious or disengaged
- Gossip and side comments about the manager (“they’re a micromanager,” “they play favourites”)
- Comments like “I’m just here for the paycheck”
Trust your gut. If something feels “off” in one area of the business, look into it. Often, the emotional climate will tell you what the data hasn’t caught yet.
Track Complaints and Exit Feedback
Make sure there are safe, confidential channels for staff to raise issues. These could include:
- Anonymous surveys or suggestion boxes
- Skip-level meetings
- HR check-ins
- Whistleblower policies
Pay close attention to exit interviews. If multiple people leave the same team and cite the manager as a problem, there’s a pattern and this is not a coincidence.
Use Surveys and 360° Feedback
Leadership behaviours should be measured, not just assumed. Therefore when regular climate surveys and 360-degree feedback processes are conducted, be on the lookout for patterns such as:
- Low trust in leadership in one department
- Poor scores for respect, communication, or fairness
- Subordinates rating their manager low on support or teamwork
If the same leader keeps scoring poorly, despite good business results, it’s time to take a deeper look.
Recognise the "Brilliant Jerks" Syndrome
In Australia, this is a well-known issue, so much so it’s earned its own label as the “Brilliant Jerks.” These are high performers who get results but erode culture, push good staff out, and drain team morale.
Research shows that toxic employees cost more than high performers contribute. Productivity, retention, and wellbeing all suffer under a brilliant jerk. Performance should never come at the expense of people.
Managing a Toxic Leader, Fairly and Legally
Once you’ve identified a toxic manager, don’t rush to termination. It’s essential to follow a structured, transparent process that protects both your staff and your legal position.
Here’s a step-by-step process:
1. Gather and document evidence
Start with a clear record of concerns
Complaints or informal feedback
Exit interview patterns
Team metrics (turnover, sick leave, engagement scores)
Notes from 1:1s or skip-level meetings
Behavioural examples (e.g. communication style, performance review trends) Keep all documentation dated, factual, and securely stored.
2. Hold a formal feedback session
Don’t assume they know their behaviour is toxic. Sit down with the manager (with HR present) and
Share specific concerns and patterns
Link behaviours to impact on the team
Reiterate the leadership values of the organisation
Clearly state that change is expected
Here are some professional one-liners you can use during these conversations
- “We’ve received consistent feedback that your communication style is having a negative impact on your team.”
- “There’s a pattern emerging in team feedback that indicates staff feel unsupported and undervalued.”
- “While your results are strong, we’re seeing signs that the way you’re leading is causing disengagement and burnout.
- “There have been concerns raised about fairness and respect in how you manage your team.”
- “Your leadership approach appears to be affecting staff retention and morale, this is something we take seriously.”
- “We’ve noticed a spike in sick leave and turnover in your team. That suggests something deeper is going on.”
- “Staff have shared they feel uncomfortable raising concerns with you, this creates risks for both the team and the business.”
- “I want to be clear: this is not just about performance outcomes. Leadership style and behaviour are equally important here.”
- “Moving forward, respectful communication and psychological safety are non-negotiable expectations of your role.”
3. Offer structured support
This may include:
Leadership coaching
Emotional intelligence or communication training
A formal Performance Improvement Plan (PIP) The PIP should include:
Specific behaviour goals (e.g. respectful communication, no formal complaints in 3 months)
Measurable outcomes (e.g. improved team engagement scores)
A realistic timeframe (usually 4–8 weeks)
4. Monitor closely and provide feedback
Check in regularly and document
Any positive changes or repeated issues
Feedback from team members (collected ethically and confidentially)
Your own observations and reflections. Be transparent with the manager, tell them how they’re tracking against the plan.
5. If no sustained improvement, manage them out
If the manager fails to improve, follow your disciplinary procedures. This may involve
Written warnings
Final review meeting
Lawful dismissal (with proper notice or payout) Ensure you:
Comply with the Fair Work Act 2009
Seek legal or HR advice
Avoid any appearance of unfair dismissal or retaliation
Taking these steps ensures procedural fairness and positions you well if a termination is challenged. It also reinforces to the wider team that leadership standards matter, no matter how “valuable” someone seems on paper.
Build a Culture Where Toxicity Can’t Thrive
Ultimately, prevention is better than reaction. Organisations that value integrity, psychological safety, and accountability are less likely to enable toxic leadership.
- Set and communicate clear leadership values
- Train managers on respectful leadership and legal obligations
- Link KPIs and bonuses to team wellbeing, not just performance
- Encourage open communication and protect those who speak up
- Monitor engagement trends and intervene early
When toxic behaviour is addressed early and consistently, it has nowhere to hide.
Don’t Let Results Excuse Harm
A toxic manager might deliver on paper, but if they’re leaving burnt-out staff, high turnover, or constant stress in their wake, they’re doing more harm than good.
You can’t manage what you don’t measure. Use data, feedback, and your workplace culture to keep leadership healthy from the inside.
Final Thoughts
If this article helped you reflect on your internal leadership team, don’t keep it to yourself. Share it with another manager, team leader or HR contact who cares about creating a healthy workplace.
The more we share practical strategies like these, the more we create organisations where results and respect go hand in hand.
Good leaders welcome accountability.
Let’s raise the standard!
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ABOUT THE Author - Kylie Dowell
Kylie Dowell is a seasoned WHS consultant, trainer, and safety advocate with over 25 years of experience helping Australian businesses create safer, compliant workplaces.
Through her partnership with TEAMS, an accredited Registered Training Organisation, Kylie delivers a wide range of training up to Advanced Diploma level, empowering businesses with the knowledge and skills to manage safety effectively.
As an approved trainer for Health and Safety Representative (HSR) courses by three Safety Regulators, Kylie has guided countless organisations in building stronger safety cultures and fostering healthier work environments.
Specialising in practical and effective safety solutions, she works closely with small and medium-sized businesses to simplify complex WHS requirements, making safety approachable and achievable.
When she’s not delivering high-quality training or conducting ISO 45001-certified audits, Kylie enjoys collaborating with her clients to design tailored workshops and strategies that suit their unique needs.
Ready to make safety simpler? Get in touch with Kylie today for personalised support.