Fama publishes flagship industry benchmarking report: The State of Misconduct at Work
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Workplace misconduct is a pressing issue that plagues organizations across industries. The effects of misconduct range from tarnished reputations to legal repercussions and financial losses, and those consequences impact various stakeholders, from employees to customers and communities. Alarming as it is, even a small instance of misconduct can wreak havoc on an organization. Research has shown that just one toxic individual within a team of 20 can lower productivity by 30 to 40 percent and increase the likelihood of team members leaving by 54 percent. This phenomenon is known as the "5% rule," which states that when 5 percent of a workforce engages in misconduct, productivity drops and turnover escalates.
In 2022, Fama’s online screening solution screened hundreds of thousands of candidates for workplace misconduct. The results are shared in a new report, The State of Misconduct at Work in 2022, which provides both hopeful trends and concerning insights.
The encouraging news is that as a whole, the research report shows overall misconduct levels dropped slightly between this and last year. Comparing data from 2021 and 2022, overall levels of misconduct dropped from 11.4% to 10.7%. Notably, government and non-profit, and healthcare industries led the way, even falling below the 5% threshold. These industries' commitment to enhanced screening practices played a significant role in reducing misconduct rates.
However, the research shows several sectors failed to meet the 5% threshold, with some experiencing alarming year-over-year increases. The technology industry witnessed misconduct levels soaring from 13% in 2021 to over 20% in 2022. Similarly, Consumer Services and Education sectors saw increases of 16% and nearly 8%, respectively. The most troubling was the Media and Entertainment sector, where more than a quarter of candidates engaged in misconduct.
Evidently, there's a considerable amount of work left to be done to create safer workplaces. It's imperative for organizations to learn about their specific industry data and assess their own risk factors. The State of Misconduct at Work in 2022 research and companion Benchmarking Quiz offers a useful tool for companies to benchmark themselves against industry standards and identify areas for improvement.
The research also identifies 6 steps companies can take to combat workplace misconduct:
Review Corporate Culture
Assess company values and corporate culture to ensure they prioritize ethical behavior, discouraging misbehavior from becoming the norm.
Enforce Policies
Implement simple yet effective measures such as enforcing mandatory time off, which can help uncover instances of financial misconduct.
Evaluate Training Programs
Rethink training programs to avoid normalizing misconduct inadvertently. Harvard Business Review warns that some programs may have the unintended effect of increasing worker disaffection.
Enhance Candidate Screening
Strengthen candidate screening processes to identify red flags early on. Online screening can provide insights into candidates' online behavior, revealing potential issues.
Continuous Monitoring
Implement continuous monitoring and employee listening strategies to detect signs of misconduct and address them promptly.
Effective Communication
Establish robust communication channels to provide employees with the support they need. Effective communication can significantly reduce misconduct levels and address turnover concerns.
The reality is that workplace misconduct remains a pervasive challenge that requires proactive efforts from organizations and industries. With a comprehensive understanding of what constitutes misconduct and benchmarking data, organizations must look inward to evaluate their existing policies, processes, and technologies. Addressing workplace misconduct not only safeguards the organization but also creates a more conducive environment for employees to thrive. As industries evolve, it's crucial to prioritize ethical behavior and create a workplace culture that discourages misconduct, ensuring a brighter future for organizations and their employees.
Click here to read The State of Misconduct at Work in 2022: An Industry Benchmarking Report now.
Assess your company’s unique risk factors by taking Fama's Workplace Misconduct Quiz.
About Fama.io
Fama’s online screening makes hiring great people easy. We automate candidate screening and due diligence to help organizations, agencies, and VCs avoid workplace misconduct, prevent costly legal action, and improve quality of hire and partner. We do this through AI technology that compliantly searches 10,000 online public sources for 9 types of misconduct like fraud, threats, and violence. We’re FCRA, EEOC, and SOC2 compliant, and integrate with major HRIS, ATS, and background check solutions.
Headquartered in Los Angeles, CA, Fama has raised over $30M and is backed by some of the world’s leading venture capitalists and institutional investors. To learn more, visit www.fama.io.
