Many organizations across the US are having trouble retaining high-performing employees. But did you know that the performance punishment cycle drives many of these resignations? It may not be obvious or intentional, but it is happening nonetheless, and there are negative consequences even before employees depart your company.

This piece examines the performance punishment process and how it manifests over time. You will see how it’s one of the drivers of the so-called Great Resignation. But most important, are the practical tips and suggestions to address or prevent this phenomenon from disrupting your business.

Understanding the Performance Punishment Cycle

Punishing your best employees sounds counterproductive, and it is. It’s a slow, deadly process that has become widespread in too many US firms. So what is it, exactly? The simplest explanation is that bosses lean too hard on specific workers. And the more these star performers achieve, the more the company expects of them, and so the problem snowballs. Think of it as making your strongest employees the victims of their own success. 

There are four stages to the performance punishment cycle:

  • Stage 1: A high-performing individual goes above and beyond expectations
  • Stage 2: In response, the worker is taken for granted and expectations (the employee’s and organization’s) rise
  • Stage 3: The employee starts to feel stressed, overwhelmed, and unappreciated
  • Stage 4: Your allstar employee starts seeking alternative employment

The knock-on effects are a decline in workplace morale and lost productivity. But, fortunately, employers can take steps to manage this harmful cycle once they recognize its effect.

The Root of Performance Punishment

There are several factors driving unintentional performance punishment. The most common is when well-meaning leaders act on unconscious biases. Examples of these are biases are similarity, expedience, experience, distance, and safety; otherwise known as the SEEDS model. You can use this framework to help identify thought processes that lead to biased thinking.

Here’s how the SEEDS model shapes biased decision-making:

SIMILARITYMost tasks are allocated to those who share the same views.
EXPEDIENCEA person seems like the right fit, so it must be true.
EXPERIENCEPreference is shown to those with experience in similar tasks.
DISTANCEClose proximity is more convenient than long-distance interactions.
SAFETYSafe bets are made by tapping those in trusted positions. 

Constantly delegating extra work to a handful of your best people without considering or rewarding them is a real problem. Although high-achievers expect to work hard, they don’t thrive when taken for granted. Another reason companies rely so much on a handful of talented individuals is that they retain bad hires. This retention is partly due to the increased competition for a flagging number of go-getters seeking work.

America’s rapidly shrinking talent pool of prime candidates has become a growing concern for US companies. Retaining high-achievers and rising stars adds another layer to the workforce challenges. Of those who stay, as many as half will become quiet quitters. We will look more into the “quiet quitting” phenomenon shortly.

US employers need to move away from old business thinking. To thrive and survive in post-pandemic America, companies must embrace change or lose out to rivals. It’s time to welcome the future of work through innovation, flexibility, and willingness to adapt. And for that, you need progressive leadership at the helm.

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Addressing the Performance Punishment Cycle

The first step towards breaking the performance punishment cycle is to recognize that it exists. The next step is to stop piling extra tasks and responsibilities on your high performers when others succeed doing less work.

Here are a few ways to remove those biases causing exploitative business practices:

  • Spread tasks out more fairly across individuals and teams
  • Have someone take over projects when top performers are absent
  • Offer continual support, acknowledgement, and rewards for exceptional performance
  • Coach up under-performers to increase team performance and spread the load
  • Expedite replacing bad hires with more suitable candidates

Expecting high achievers to work longer hours than others and subjecting them to additional stress or scrutiny is counterproductive. Eventually, they will walk away. A better method is to remove low-value work from their list of duties. This approach lets your star workers focus on the important high-value tasks where they shine.

Recognize the Real Effects of Overworking

There is a big difference between hard work and overwork. Some people thrive on putting in long hours and getting things done. The problems occur when employers or leaders continually place unrealistic expectations on individuals or teams. There comes a point when workloads become too much to bear, leading to serious negative effects. And these outcomes don’t just disrupt job performance; they also impact health and relationships.

Below are some of the real consequences of overworking employees.

Reduced Mental and Physical Wellness

High-achieving workers often push themselves past mental and physical limits. It is one of the defining features that makes them so valuable. But, it’s not something that can be done regularly, it’s unsustainable. 

Standing or sitting for extended hours without proper de-stress periods is physically uncomfortable and mentally taxing, and that’s bad for employees and employers. Once an employee recognizes they’re caught in a hamster wheel of being rewarded for working hard with more work and others’ work, they quickly begin to feel resentful. This resentment breeds frustration, job dissatisfaction, and increased absenteeism.

Performance Punishment to Burnout

Companies that lean too heavily on high performing workers unintentionally cause their debilitating states of burnout. A pre-COVID study from 2018 found 40% of employees want to quit because of stress. A more recent study saw that number rise to 70%. The contributing factors are a lack of appreciation, overloaded schedules, and unrealistic expectations. [1] [2]

High performer burnout has become too common in modern work environments. Those who suffer from it experience often experience lasting mental, emotional, and physical exhaustion. Some visible signs of burnout are cynicism, detachment, a notable drop in performance, and absenteeism. This toxic state manifests faster if the person loses a sense of personal satisfaction from the tasks allocated to them.

According to a 2021 study, the burnout rate in the US is now at 59%, up from 13.5% the previous year. It’s little wonder so many are looking for less-stressful positions. [3]

Resentment and Workplace Toxicity 

Employee well-being and workplace productivity cannot thrive in toxic cultures. Negative attitudes, unhealthy behaviors, poor communication, and low morale are characteristics of such environments. Averse cultures lack trust and transparency and create resentment among workers. Few can tolerate working in such environments for long. It’s why firms with poor cultures experience a chronic cycle of absenteeism and high turnover rates.

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Quiet Quitting: A Reaction to Performance Punishment

Quiet quitting is a new defensive strategy used by exhausted employees to avoid being sucked into performance punishment cycles. Quiet quitters focus on their core responsibilities and disengage as much as possible from pile-on tasks to avoid them becoming an expected part of their role. A 2022 Gallup survey suggests that at least 50% of the US workforce now practices quiet quitting. [45]

Several reasons bring about quiet quitting, including punishing high achievers. Workers won’t care about their organization’s wellbeing if they feel their employer doesn’t care for theirs. They will feel undervalued, overworked, or frustrated by the lack of alternatives and opportunities. Other causes are toxic cultures, bad management, and inflexible schedules resulting in poor work-life balance.

The High Cost of Workforce Churn

A company struggling to hold onto its employees suffers from workforce churn. Performance punishment is a surefire way to ship your best talent to rival firms and keep the talent turnover door revolving. Here are the most notable causes of workforce churn:

  • Unrealistic expectations and impossible deadlines
  • Disengaged management
  • Inadequate support or training
  • Low employee engagement
  • Limited growth opportunities
  • Low job satisfaction
  • Competitive job opportunities

At best, workforce churn eats into the bottom line of companies with deep pockets. At worst, the inability to attract and retain workers will see smaller organizations begin to fail. But attracting and onboarding new hires is both complex and pricey. Costs vary, but estimates suggest US firms spend at least $4,000 and 24 days hiring new workers for an opening. [5] However, due to the impact of the Great Resignation, these figures are sure to rise at the next count.

This table illustrates the processes that contribute to new hiring costs.

Recruitment technology
Potential agency fees
Potential travel expenses
Background checks
Candidate relocation
Employee referral bonuses
Salary and benefits
Training and development
Productivity adjustments

Transforming Overworked to Overjoyed

Start with culture. A healthy workplace culture is one in which the company prioritizes respect, open communication, and collaboration so workers feel valued and supported. Leaders should recognize and reward good work, and there should be a fair distribution of projects and tasks. 

Healthy cultures foster inclusivity and employee well-being, encourage work-life balance, and offer growth opportunities and other incentives. Empathetic employers can use various strategies to address stress factors in the workplace. 

Invest in Employee Wellbeing

Provide employees easy access to resources such as mental health counseling or employee assistance programs (EAPs). Managers and supervisors can encourage work-life balance initiatives like flex time and telecommuting. Learn to recognize the early signs of burnout in your workers and address them early on.

Also attend to employees’ physical wellbeing. Workers experience less discomfort in ergonomically correct workspaces. Also, consider shorter, more regular breaks over longer, less frequent ones. A 2017 study saw that micro-breaks are better for relieving musculoskeletal pain without disrupting productivity. [6]

Reconsider the Delegation Process

Employers can start reviewing the tasks they allocate and to whom. To retain star performers, ensure you set goals with realistic expectations and recognize employee contributions. Encouraging open communication will improve collaboration and help create a more supportive environment.

Reduce Employee Turnover

Recruiting costs vary depending on the position, company location, people, and systems used to attract applicants. The best approach is to avoid workforce churn altogether and save your organization from these expensive headaches. 

The foundation for improved employee retention follows a reproducible pattern of fair treatment, compensation, recognition, open communication, and career development opportunities. These are the building blocks of a positive work culture, job attraction, and worker retention.

Performance Empowerment Over Performance Punishment

The performance punishment cycle is a growing issue, made even more problematic as the US talent pool shrinks. It’s counterproductive with its negative consequences for individual employees and entire organizations. Fortunately, the needed changes are simple, if not always easy.

Creating a positive culture, fostering work-life balance, and ensuring fair treatment for all will help you attract and retain the best people. To retain the best, employers must support their high performers going forward and help develop a more balanced, equitable workforce.

Caring workplaces create positive work cultures where people thrive. They foster open communication, encourage feedback, and promote teamwork. Remember, a happier worker is more productive and less likely to seek alternative employment.

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