Most leaders treat toxic employees like isolated incidents.
Someone's negative. Someone's difficult. Someone's undermining the team.
Fire them. Move on. Problem solved.

Wrong.

Toxicity isn't a trait that walks in the door. It's a condition that develops, and whether it spreads depends almost entirely on the environment leadership creates.

I've seen organizations where toxic behavior is identified and contained quickly. Leaders act decisively. The behavior stops before it infects anyone else.

I've also seen organizations where it spreads fast. One person's cynicism becomes the team's default. Public doubt becomes permission for others to disengage. Solid performers start questioning everything.

Same behavior. Very different outcomes.

The difference is leadership.

How Pressure Weakens Your Immune System

Organizations under stress become more susceptible to toxins.

When companies miss targets quarter after quarter, freeze raises, skip reviews, or announce layoffs, the immune system weakens. Leaders get distracted. Communication drops. One-on-ones get skipped. Delegation turns into micromanagement.

Survival mode takes over.

That's when toxicity spreads fastest.

I see this repeatedly right now. Companies under real pressure aren't dealing with worse people. They're dealing with stretched leaders who aren't operating at their best.

Strong leadership and clear values act like antibodies. Weak leadership under pressure? That's a petri dish.

There's an old saying: the fish rots from the head. When I see toxicity spreading, I don't just look at the employee. I look up.

What in the leadership, the culture, or the values allowed this to develop?

Why Toxic Behavior Spreads and Poor Performance Doesn't

Here's a distinction most leaders miss:
Poor performance is visible but contained. People notice it. They may have to work harder to compensate. It slows things down.

But it doesn't spread.

Toxic behavior does. And that's what makes it toxic—not that someone is negative or difficult, but that their behavior proliferates throughout the organization.

They publicly doubt leadership. They openly undermine decisions. They make cynicism feel like the smart position.

One person's negativity becomes permission for others to do the same. Eye-rolling in meetings teaches disengagement. Back-channel conversations metastasize into factions.

Cynicism is contagious. Performance issues aren't.

A McKinsey Health Institute study of nearly 15,000 employees confirms this: toxic workplace behavior is the single biggest driver of burnout and intent to leave. Employees exposed to high levels of toxic behavior are eight times more likely to burn out themselves.

And research from Harvard Business School found that exposure to toxic workers increases the likelihood of becoming toxic yourself. The behavior spreads through emotional contagion. One person's negativity becomes the team's default.

Even relatively modest levels of toxic behavior can cost organizations billions of dollars in customer loss, damaged employee morale, increased turnover, and loss of legitimacy among external stakeholders.

That's why you deal with toxicity differently.
Performance deserves patience. Coaching. Time to turn things around.

Toxicity deserves speed.

Why Speed Matters More Than Fairness

Leaders often slow down because they want to be fair. They want context. They want to avoid overreacting.

All reasonable instincts.

But toxicity is one of the few problems where delay isn’t neutral. Every day the behavior goes unaddressed, it teaches the organization what is acceptable.

The nuance isn't “fire fast.” The nuance is “contain fast.”

Name the behavior quickly. Stop the public undermining. Interrupt the back-channeling. Reset the standard in real time.

Then you diagnose.

Because removing a toxic person might relieve the symptoms, but it doesn't cure the condition that created them.

When Good People Create Toxic Combinations

Sometimes toxicity isn't even about bad people. It's about bad combinations.

During a merger I led years ago, I had two senior leaders, both strong performers, suddenly forced into an overlapping structure. We tried to avoid picking sides by creating an arbitrary departmental split.

I had all the best intentions. In retrospect, let’s just say it wasn’t my best idea.

Within weeks, they were competing instead of collaborating. In one meeting, a disagreement escalated into a shouting match. Both standing. Both yelling expletives.

I let it go for a moment, making eye contact, trying to give them space to catch themselves.

They didn't.

I adjourned the meeting and met with each of them privately. I knew they both knew better so my message was clear: the next outbreak like that and you're fired. It’s simply unacceptable in this environment.

They didn’t get into a shouting match again. Instead, I insisted on regular, productive conversations. The situation was still far from perfect, but things slowly started improving.

We caught it early. We stopped the spread.

Some elements aren't toxic on their own. Bleach cleans your house. Ammonia cleans your house.
Use them together and you create a toxic gas.

Those two leaders weren’t bad apples. They were excellent individually. The environment created the toxicity.

Why Firing the Person Isn't the Sufficient Fix

Here's the mistake most leaders make: They fire the toxic employee. Assume the problem is solved. Move on.

They never ask what created the conditions that allowed that person to become toxic in the first place.

Because nobody starts toxic.

We don't hire toxic people. New hires arrive optimistic and invested. They're often your most positive employees.

Toxicity develops after a series of events. Missed expectations, poor role fit, pressure without support, leaders who stop communicating, or cultural signals that say, "this behavior is tolerated here."

If you don't fix the environment, you'll just grow another toxic employee.

I saw a post on LinkedIn recently from a leader who fired a manager after a star employee quit due to toxicity. My question was simple: how did someone quit before you knew there was a problem?

That doesn't point to a single bad manager. It points to a leadership blind spot above them. Always look up.

The Three-System Diagnostic Leaders Skip

Once you contain the behavior, and once you remove the person if that's what needs to happen, you still have work to do.
You need to examine three things.

Leadership practices. Are you holding regular one-on-ones, giving feedback, and staying present? Or are you withdrawing under pressure?

Right seats. Has the organization outgrown someone? Did you promote past capability and leave them there too long? Did you create a structure where two people are competing for the same space?

Core values. Are they lived, reinforced, and rewarded? Or just words on a wall?
This is hard to see on your own. That's why peer boards, coaches, and advisors exist. To give you perspective when you're too close to it.

When the Toxicity Starts at the Top

A few years ago, I was brought in to coach a COO. His boss, the founder and CEO, was toxic.

Dismissive. Narcissistic. Always right. Leadership meetings were silent because people were afraid to speak.

I asked for a one-on-one with the CEO. His response: "I'm great. He needs help."

All armor. No curiosity.

When performance declined, layoffs followed. That created an organization waiting for the other shoe to drop. More toxicity spread.

The COO went to the board. Their response was simple: we have other problems worth our attention. Other problems that can be fixed. This, they knew, couldn’t be fixed.

They'd already given up. Too toxic.

People left. The company eventually collapsed. By the time I was involved, and without access to the person at the top, it couldn't be saved.

When toxicity originates at the head, you can't fix it from below.

The Real Leadership Question

Strong cultures don't eliminate toxicity entirely. They detect it early and contain it fast.
They have antibodies: clear values, frequent feedback, leaders who stay engaged even under pressure.

The goal isn't perfection. It's resilience.
Whether a single bad apple spoils the barrel is one of the clearest indicators of leadership quality.

So when you remove the next toxic employee, don’t just celebrate the relief.
Ask yourself the question most leaders avoid:
What conditions did we create that allowed this to happen?

Because the answer determines whether this was an ending, or a rehearsal.