Recognizing Corporate Employee Abuse

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Two years ago I delivered my early retirement notice.   This means I’ve enjoyed one hundred and four consecutive Mondays without attending a sales meeting and one hundred and four Sundays without seeing an email at 3pm in the afternoon driving my irritation level up.

In the last two years, I’ve thought a lot about my career and the corporate culture I worked in.  Some of the culture was good, while many other aspects of it were abusive.  When I say “abusive”, this isn’t to say I was physically harmed, but much of my burnout and drive could be contributed to the specific employer I worked for followed by the industry I chose.

The profession was rewarding financially and at times personally.  I enjoyed leading people and helping businesses be successful.  I got to “sell money” for most of my career.  Who doesn’t like money?  I made loans that paid off over time, then borrowers would get new loans.  Every day businesses were borrowing money, so the opportunity to see new deals was only limited by my personal efforts and hours in the day.  I grew up with financial insecurity and here I was being paid six figures to learn about money.  

Still retired enough for weekday walks in the park

I will specifically remember a breakfast I had with a friend a few months before I retired.  He listened and told me bluntly: “ I don’t think you need early retirement as much as you need a new employer”.  A lot of my frustrations turned out to be as much about corporate abuse and burnout from that abuse than my actual drive to be productive waning.  

I’m going to make the following disclaimer before I write this:  I was paid well to accept what I endured.  I was compensated well to accept what I put up with, but in hindsight I could have been similarly compensated without many of the headaches had I been able to identify a toxic culture.  

Identifying a Toxic Workplace and Signs of Corporate Employee Abuse:

I asked this question on Twitter and got some great responses!  

I put together a number of these comments along with some personal experiences and included it in my list of signs of a toxic workplace.  

Unrealistic Goals:  

Goals are supposed to be difficult to achieve, but not impossible.  They should be set in reality and proportionate to what others are doing in the company and what is comparable in the market.   My former employer would always set a goal to grow 7%, then trickle out individual goals based on that target.

 It didn’t matter that the staffing level they chose made it mathematically impossible to meet that goal, it was just “you go do it.”   Every year they would fall short and start the hiring freezes mid year and layoff people right before Christmas.  If you can’t hit your EPS goals through growth, then cutting and creating accounting (one-time charges anyone?) it is!

“I’ll Take Care Of You” (In The Future).  

What could possibly be better than a verbal promise of an unquantifiable reward at an undetermined future timeframe?   Early on in my career I saw an Executive Vice President twice “promote” people to jobs with more responsibility and have them accept the job without a pay raise.  “I’ll take care of you” was the company line.   Fortunately by the time I got those promotions there were formal offer letters, but I still had to basically accept the job and had little room for negotiation.  Then the only thing I could do was to check on the manager’s reputation.  Since I only worked at this one organization, I didn’t realize how odd this process was.

Excessive Tracking

How many people are employed to track what people do all day?  How many people do nothing but look at CRM systems and create different variations of the same information?  I worked in a business that had a few metrics that drove 90% of the division’s performance.  Instead of focusing on those 3-4 metrics, there were more than twenty data points that people were tracked/measured on.  This meant it was easy to have similar levels of overall performance for two employees, but also for managers to reward people by leaning on a couple positive metrics while punish others by leaning on a couple negative metrics.  

How the company/managers handle people leaving?

The next career opportunity can’t always be at your company.  This is especially true if you employ and develop a team of high performers.  Sometimes there isn’t a “next level” position open and your company refuses to pay someone to wait.  How does the company handle the person leaving?  Are they complementary and maintain a good relationship, or do they start blaming this person as a scapegoat for anything that goes wrong?  Do they give a gracious going away party or quickly move on?  I saw my employer turn over my career, showing resentment towards anyone who left, likely because of middle management thinking “they got out and I didn’t”.   Seeing a 15 year employee that’s well liked be escorted out without being able to say goodbye just because he was going to work for a competitor was discouraging. 

Refusal to Discuss Negative Information 

Reality is accepting what is, is.  Alternatively, evading reality is one of the more destructive behaviors in business.   This culture perpetuated itself over the final decade in my career, with people who presented negative information being branded as having a “bad attitude”, while people who avoided discussing negative information were promoted for being a “team player”.   Unfortunately when you refuse to discuss negative information, smart people start leaving.   In (life and) business, choices have consequences.  Ignoring bad information doesn’t make it go away.  

Unpaid Diversity Groups.   

This one is simple to me:  It is not your minority employee’s responsibility to better the company with diversity, especially in an unpaid capacity.  The place I worked for created committees that were on a volunteer/voluntold basis to “foster diversity in the workplace”.   I had the unique responsibility of being the “leadership liaison” to one of these groups, all while thinking “wtf is this”.   

The company would have been far better off having a professional Human Resources professional local and hiring diversity managers corporately.  Transparency and panel interviews for Executive Vice President positions would have been helpful as well, as these carried substantial home office bias.  It’s not the rank and file employees responsibility to fix a culture that doesn’t value diversity.  

Weekend Emails

I was guilty of both sending these and reading them.  There was rarely internal information that couldn’t wait until Monday.   The best boss I worked for almost never sent emails, the worst would send a huge essay about performance on Sunday, which either told us things we already knew or was meant to make everyone feel terrible about their performance.  I’m now 104 Sundays free of weekend email.

Expense Pettiness

Expenses are important in business.  So is focusing on expenses they can have major impacts to the bottom line.   The company would have massive in-person meetings costing hundreds of thousands of dollars, yet removed cell phone reimbursements, reduced mileage reimbursement, and would give the speech every year about how “merit increases will be small”.  

Constant Turnover in Middle Management

A huge red flag is the amount of turnover in middle management.  A solid culture will have the ”same people in the same seats” for an extended period of time.  This is especially true for division heads that report up to the C-Suite.  If the company is experiencing constant turnover at that level, it is likely because this reporting level is tired of dealing with an unrealistic c-suite and constant strategy changes.

I remember one critical division head position in my company changed eight times in the span of sixteen years.  Why couldn’t the company find the long term solution?  What made this job so difficult that two who actually could do it were promoted while six others were fired, left on their own, or were demoted?  

Excessive Corporate Relocations

I played a part in this game:  Do I want to move my family around so I can be a middle manager in Office Space?  In hindsight, the company’s culture was so disconnected from reality that outside hires above a certain level just didn’t work.   The only option for managers to be comfortable was to relocate someone from within that would accept irritations that didn’t exist at other employers.   What damage does this do to someone’s family?  Is this worth the sacrifice for $1,500/mo in more income?   Personally corporate relocations cost me a significant amount of money in real estate along with relationships I’d built over years in one market.  

Lack of Openness in Promotion Processes

I touched on this earlier, but lack of openness about the promotion process is toxic.  The company I worked for would “post” a position because they were required to, but then if someone inquired about it the manager would say they already had their person identified.  The job would be posted for twenty four hours and then removed because the hiring was already completed before the job was ever “open”.   Above a certain position, the hiring process had no transparency.  Even worse, it turned out there were far more promotions promised than slots that actually opened and the company wasn’t one to pay people the next level up compensation to wait.  

Long Vesting Period in Equity Compensation / Heavy in Restricted Stock

Equity compensation is popular above a certain pay range:  “Make employees owners of the company”.   It sounds nice, but most people in middle management sell their stock.  It’s just another form of cash and dilutive to shareholders.   Most restricted stock plans in corporate America have a vesting schedule that slowly pays out over four years, both tying the employee to the company but giving them an “incentive to stay”.

The challenge with a program heavy in restricted stock is the company hands you numbers on a sheet of paper that isn’t your money yet – it’s only a promise of future compensation.  Future compensation that often only comes when you stay with that employer.   The company I worked for was especially restrictive, the stock was paid 49 months from the date of issuance.  Grants would be made in February and stock based compensation was paid in March.   The only way to have this accelerated was to be laid off or retire at age 55 with 10 years of service.  Ironically I tried to get laid off, but at the time layoffs were a tool to remove mediocre employees instead of actually firing people.  I performed at my job, so both couldn’t be laid off and couldn’t receive this equity for retiring, even though I had more than 10 years worth of service.

The toxic environment this created in my old organization was that there were many people in middle management between ages 45 and 54 that couldn’t yet “retire” and take their pay then go work for another company.  These were disengaged employees trying to do the minimum to not get fired, often hoping for a layoff instead.   This was especially true due to the long “cliff vesting”. 

Most companies pay their restricted stock over a more generous vesting schedule, such as 1/4th per year.  Here’s the difference in pay vs. the structure I was in, known as cliff vesting.  

Year 0Year 1Year 2Year 3Year 4Year 5Total
RSU Amount$70,000$70,000$70,000$70,000$70,000$70,000
Waterfall Vesting25%25%25%25%25%
Amount Paid$17,500$35,000$52,500$70,000$87,500$262,500
Cliff Vesting0%0%0%100%100%
Amount Paid$70,000$70,000$140,000

The difference between these two schedules is significant.  Under the first scenario, the employee has received $262,500 and if they left, “forfeits” $157,500.  Under the second scenario, the employee only receives $140,000 while “forfeiting” $280,000.   That’s a significant amount of compensation just based on a longer vesting schedule.  

Wrapping Up

I held off writing this for two years because I wanted to avoid “sounding bitter”.   I’m not necessarily bitter towards my old employer about any of this, more frustrated that I didn’t see all of these signs of a toxic workplace until the last couple years of my career.  I had relocated a number of times and at that point changing employers would have involved some combination of a geographic relocation, more work in the short term, and potentially a pay cut, so I grinded it out for the last years of my career.   That grind created burnout that took time to recover from.  If I can help others identify signs that something is amiss, maybe they can make quicker decisions before driving themselves into burnout.   

I’m also continually thankful to have been pursuing financial independence during this time, it was my escape while other coworkers at a similar level had fallen prey to lifestyle inflation.  

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9 Replies to “Recognizing Corporate Employee Abuse”

  1. Good list. Many of the items on there are painfully familiar to me. In particular, my company is notorious for promoting without pay increases, because you “have to prove you can do the job” before the money comes. Also, the vilification of colleagues who leave to pursue better opportunities. This kind of culture has been directly responsible for my general apathy toward my job, probably similar to your situation.

    1. I’m sorry to hear that, but I also knew I wasn’t alone.

      What’s keeping you from changing jobs? Life’s too short to work for jerks

      1. I guess I didn’t tell the whole story. Two reasons: first, we went through a series of mergers starting in 2015 that caused a significant change in management and company culture. My salary has increased about 35% since then, and my stress levels have gone down by the same amount. Also, I attempted to quit in October, but was asked to stay on, and I’ve been working remotely since then (we relocated). I have even more control of my situation, so it’s actually not so bad now. But I agree, if it were really that bad, I wouldn’t have stuck around at this point.

  2. Wow, wow, and wow! I worked for a large national commercial real estate brokerage 20 years ago, left and never looked back. All the corporate BS was ridiculous. It got to the point where brokers would make up fake potential deals and rumours for the dreaded Monday morning meetings. 99% left for greener, less stressful firms and I can say without exception that they and I are much happier now.

    1. I might be forever thankful Monday morning sales meetings are a thing of the past.

      The “fake deals” especially hits hard, I fired someone in my last year for making up pretend deals/appointments among other things. Ended up with a wrongful termination lawsuit out of it!

  3. As a former CEO, I can say that managing this from the top is very hard. Even good intentions can go wrong. I have been the person telling others to be patient and that we will take care of them and in most cases we did, but in other other cases we weren’t able to do to corporate restrictions.

    But I think you are spot on about how managers send off employees who are moving onto new gigs. We always try to be champions of anyone who received a new job. As a boss it’s important to help someone grow their career no matter whether that is in the company or not. Big send off’s and keeping in touch how much more important than most managers realize.

    Anyways it seems like your corporate culture was very toxic, though I imagine it’s still very hard for most cultures to get it right. They are unfortunately always trade-offs of some sort even for well-intentioned companies.

    1. I appreciate the comments. It was unfortunate that life circumstances kept me there my final couple years of working, I know in hindsight I should have changed employers.

      To me it all starts with whether or not the top wants *real* information and data, even if that data is negative. Ignoring that sets off a horrific domino effect of mediocre middle managers and evasion of reality.

  4. So I work at a large commercial bank and a lot of what you have written resonates with me. I’ve been in a leadership position for a few years now, so I’ve been on both sides of the experience. From what I’ve seen, there are three issues at hand. There’s the overall company culture, then there’s a local culture including your manager’s leadership style, and then there’s how you decide to fit into the culture.

    I have found that many people who complain about work-life balance often are their own worst enemies in that department. I think large financial institutions often take as much from you as you’re willing to give them. For employees that have a hard time creating balance, sometimes they are better off at a company with a slower pace in their culture. In banking, that probably means community banks. There could be a tradeoff in compensation for going that route, however. There’s probably corollaries to this in many other parts of the broader professional services world.

    For me personally, I struggled with balance when in a sales role because it was hard to “turn off” when I was the primary contact for customers and prospects. I also had a manager who was difficult in many of the ways you described in your article. I was able to find much better work-life balance on the credit side of our bank. It is still production oriented, just in a less stressful way.

    Also – ouch, the idea of cliff vesting on restricted stock really sucks, especially if you’re not leaving to go to a competitor willing to match it. We have RSU waterfall vesting over 4 years. Deferred comp vests in a waterfall fashion over 3 years.

  5. I don’t think this is bitter at all and definitely addresses what I am going through right now at a big tech company.

    Unfortunately, I don’t think switching companies will do much better, because most big companies are like this. One could join a startup / smaller team for a better chance at a better culture or slightly less terrible politics – but this would only be a guess.

    For me, switching jobs is mostly necessary in terms of maximizing my financials. But in all honesty, there’s not really a great way that I know of to vet a company’s culture *before* they hire you. You can ask them during the interview and everyone will say it’s great working at a terrible place, because that’s what they’re trained to do. But at the end of the day, I feel like you won’t know how good or bad an employer is until you actually join the company, and more specifically, the team.

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