Employee Misconduct on the Increase, Study Finds

As more and more people are returning to work in offices after working remotely for a few years since the COVID-19 pandemic arrived, bullying and other workplace misconduct is increasing, according to a new study.

The study by Fama Technologies, a maker of applicant screening software, found increases in misconduct growing across industry sectors, putting employee morale, retention and productivity at risk for affected companies. If pervasive enough, it can turn into a legal liability for an employer as well as a blot on its corporate reputation.

It’s crucial for employers to understand the problem of employee misconduct and take steps to eliminate it.

Fama Technologies notes that one bad apple out of 20 in the workplace can have a significant effect on morale, productivity, engagement and retention. According to Fama: “This is known as the 5% rule — and is the foundational benchmark for this research.”

Employee misconduct is defined in the report as behavior that violates employer policies or breaks the law, and which negatively affects a company and its employees. Misconduct can be committed by rank-and-file workers, supervisors, managers and even in the C-suite.

There is a wide range of misconduct, including:

  • Tardiness
  • Drug use
  • Bullying and abusiveness
  • Harassment
  • Sexual misconduct
  • Intolerance
  • Threats and violence.*

*Nearly 2 million U.S. workers are victims of workplace violence each year, according to OSHA.

Fama’s “State of Misconduct at Work” report found that:

  • 10% of job candidates were found to have misconduct issues in 2023.
  • Content with misconduct increased 40% year over year.
  • Eight out of nine industries failed to successfully mitigate misconduct below the 5% threshold.
  • Industries with the most misconduct were consumer services, media and entertainment, and education.
  • The most common forms of misconduct were harassment, sexual misconduct and intolerance.

What employers can do

Putting in place a system for preventing misconduct requires input from a number of company individuals, including rank-and file employees, HR and IT. Focus on the following:

Create and implement unambiguous policies. Include a clear and concise worker code of conduct in your employee handbook. Specify exactly what types of behavior are considered inappropriate, as well consequences for non-compliance.

The policy should outline the consequences for various types of misconduct. Consider including a social media policy in the code as errant employees increasingly turn to those sources to vent and harass.

Set up a safe-reporting mechanism. Put in place a mechanism for employees to report misconduct with the promise of anonymity and without fear of reprisal. Identify who they should turn to and how to file a complaint.

After someone files a report, it’s incumbent on the employer to conduct an investigation to verify the complaint. That can include surveillance, interviewing other employees, and more.

Be vigilant. Employee theft and fraud is also misconduct. Be vigilant of employees that may be first to arrive and last to leave every day. Require that everyone take time off from work and use at least some of their vacation. It’s easier to detect fraud when the perpetrator is not at work for some time.

At the same time, requiring your staff to take time off can also help reduce their life stress and force them to unplug from work for a while.


One final step is to ensure that you have in place an employment practices liability insurance policy, which can help cover the costs of employee lawsuits, jury awards or settlements.

It can protect you if your organization is sued for a covered event like harassment or discrimination.

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