Every executive and entrepreneur knows that a business employing the right people has a significantly greater chance for success than one without the right people. So why, then, do so many businesses tolerate “toxic employees?”

Toxic employees make both positive and negative contributions to the business. While their performance will be good at times, they also foment dissent, talk down to other employees and are generally involved in those HR issues that require management time. Toxic employees are described by others this way: “I wish they would not …” or “They would be a great employee if they didn’t …” We all know toxic employees.

In this era of so-called enlightened leadership – with so much emphasis on communication, interaction and people valuation – many executives will try to mentor or fix their toxic managers or employees. In the recent past, comfortable bottom lines masked the impact and cost of these toxic employees while providing a cushion for executives to spend time and effort on them.

But comfortable bottom lines are no longer the norm. Today’s recession and poor economy have virtually every business operating “lean and mean,” with the very survival of the business dependent on each and every employee performing well. Yet many businesses still tolerate toxic employees. Why?

One reason is that businesses do not have proper performance reviews in place, or their review systems only measure productivity. If an employee is meeting their goals, evaluating the other issues that make them toxic is seldom done.

Jim Collins is the author of the business book “Good to Great: Why Some Companies Make the Leap and Others Don’t.” Collins researched more than 1,400 companies and discovered a set of ideas that, when embraced and implemented, differentiated great companies from their “good” counterparts. Collins found a business that has toxic employees has a culture that enables them.

Toxic employees are always at the center of bad morale. They infect their co-workers with bad attitudes and can bring down an entire department or business. Toxic employees are a disease. They spread gloom and resentment, which negatively affects results and individual performance, and greatly contributes to turnover.

The best way to guard against toxic employees is to avoid hiring them. During the interview process, look for these danger signs that indicate you are talking to a potential toxic employee:

• Disrespectful Behavior: Poor manners are a tip-off. Offer them a drink. See how they respond. Pay attention to how they treat any other employees they meet. Are they nice to the bosses but treat a staffer with disdain? A lack of respect shown to anyone is a danger sign.
• Body Language: A good interviewer will get a certain vibe from body language. If that vibe is anything other than what you expect, add it to your list of danger signs. It might not be a deal breaker by itself, but if it is in addition to other danger signs, then you should probably pass on hiring that candidate.
• Bad Attitude: Since most people are on their best behavior during an interview, any displayed traits that are less than you expect are a danger sign. A lack of energy, enthusiasm or basic knowledge about the company are danger signs, and so is any critical rant about a prior job or boss.
• Distrust of Others: A toxic employee will often question or discuss negatives – even going so far as to ask questions of the interviewer that are negative, like “I heard (negative),” “Why did (negative)?” or “How come (negative)?” These types of questions show a lack of trust and are significant danger signs.
• Word Choice: Listen powerfully to what is being said. Listen to the phrasing. Does it motivate? Is it what a good leader would say, or are the words a real downer?
• Ego, Pride and Wisdom: Stay away from people who make decisions in their own best interest. When people routinely put their ego or pride into their decisions, you need to be careful. The more people you can put around you who use wisdom, the better off both you and your company will be.

Your business, even with the best strategic vision, will never maximize its potential unless you minimize or eliminate the toxic employees in your company. To quote Jim Collins, “Great vision without great people is irrelevant.”

Toxic employees can make it difficult for a large business to succeed. In a small business, toxic employees will suck the very life out of the business and quite possibly be the reason it fails.

Hiring talented and good people while turning over your toxic employees is not easy. It requires dedication, a determined focus and courageous leadership. But when you consider the alternatives, you really have little choice, especially in today’s tough economy.

Businesses that stumble along with toxic employees are many; great businesses with good people are rare, but they shine in the marketplace.

Ian Lamont now works with his two sons at The Lamont Group (TLG). Recently retired, Ian spend the last 18 years of his career as a CEO of multimedia and energy businesses. At TLG Ian's focus is assisting individuals and organizations to succeed and grow. Ian can be reached via e-mail at ian@lamontgroup.biz or by calling 562-544-5822. For more information on TLG go to: www.thelamontgroup.com. Lamont's column reflects his own views and not necessarily those of the Long Beach Business Journal.