There are many factors that can lead to an unhealthy work environment, but one of the most challenging situations arises when the leader themselves is the cause.

While effective leadership can inspire, motivate and drive success, a toxic leader can have the opposite effect, negatively affecting employees’ mental health and wellbeing.

When leaders engage in bullying, harassment or discrimination, it can lead to a climate of fear, intimidation and mistrust. Employees may feel unsafe, undervalued and isolated, leading to decreased job satisfaction, increased stress and even potentially exacerbate a mental health condition.

Furthermore, toxic leaders often engage in micromanagement, which can stifle creativity, limit autonomy and erode culture. When employees feel constantly monitored and controlled, they may become demotivated, disengaged and less likely to take initiative.

In addition to its negative impact on individual employees, toxic leadership can also have detrimental effects on organisations as a whole. High turnover rates, decreased productivity, diminished organisational trust and a damaged reputation are just some of the potential outcomes.

Toxic work environments can also contribute to a decline in mental health, increased healthcare costs and a loss of productivity on a national level.

By speaking up about toxic behaviour, seeking support and advocating for a healthier workplace, employees can help address the issue.

Untreated mental health issues cost Australian businesses an estimated $10.9 billion annually in lost productivity alone. That’s $4.7 billion in absenteeism, $6.1 billion in presenteeism and $146 million in compensation claims, according to a PwC and Beyond Blue report on mental health in the workplace.

Leaders can’t be solely to blame for creating toxic environments. In the corporate world, it’s often assumed if you are good at your job, you’ll be good at leading a team too. Individuals are given more responsibility and a team to lead with little to no training on how to do it well.