GOOD-BYE, MR. DITHERS
Dick Wilson spent a dozen years climbing the chain of command at a Houston subsidiary of paper-products maker Alco Standard Corp. But when a new boss arrived in 1981, Wilson, by this time second in command, saw his star begin to fade. After refusing for months to heed hints to quit, he was transferred--at full salary--to a janitor's job, pushing a broom in the warehouse and mopping the employee cafeteria. Wilson soon suffered a nervous breakdown and left the company. "They were doing everything they could to encourage me to walk," he recalls. "I went bonkers."
Eventually, he struck back. Wilson had no previous psychological problems, and he believed his boss's brutal management tactics led to his collapse. So did a jury. Last year, Wilson won $3.5 million in damages, most of it for emotional abuse. A spokesman for the subsidiary declined to comment, and Wilson's boss, who has left the company, couldn't be reached.
Experts familiar with workplace disputes say neither Wilson nor his boss is unusual. Many managers these days are fearful that if they fire a subordinate outright, they'll be sued for discrimination or wrongful termination. So some are trying to force employees out by adopting psychological torture techniques, from public humiliation and loss of perks to transfers to offices in corporate Siberia. Such tactics are "as common as rain," says New York employment attorney Debra L. Raskin.
FAMILY AFFAIR. Employers that do this may simply be switching one type of lawsuit for another. In growing numbers, employees are accusing bosses of intentionally inflicting emotional distress--a type of personal injury claim that courts in 29 states have upheld. Workers are winning huge judgments. Westvaco Corp. last year was slapped with a $1.5 million award for the wife of a worker who had been taunted and demoted because of a disability. She said her husband's distress had rendered him unemployable. Westvaco's appeal was denied, and a company spokesman declined to comment.
Lawsuits aren't the only danger of a bully boss. A 1990 Bureau of National Affairs study estimated that one in four managers abuse employees enough that they call in sick, slow down productivity, or change jobs--at an annual cost to the economy of up to $5 billion. "There is no seminar on how to abuse your employees, but there's a pattern out there that's frighteningly consistent," says C. Brady Wilson, a psychologist in Scottsdale, Ariz., who has treated hundreds of abused executives.
Intimidation and bullying come at the cost of creativity and innovative thinking, adds Jay Conger, professor of organizational behavior at McGill University. Motivation "can spurt up briefly because of the fear," he says. "But that type of motivation tends to be very short-lived because it is fatiguing. You wipe out creativity and fresh approaches and create a narrow band of yes-people."
Generally, the abuse has to be fairly outrageous for a suing employee to win. But the bounds have been shifting, notes Paul H. Tobias, founder of the National Employment Lawyers Assn. A decade ago, a Kmart Corp. clerk sued after undergoing a strip search in front of a customer who accused her of theft. She lost the suit. By 1988, standards had changed, enabling a Bear, Stearns & Co. manager to win a suit after being forced to pack up and move her office while recuperating from major surgery.
The media deserve some of the blame for lionizing macho management, as do business schools that hold up hard-charging executives as colorful examples of managers on the move. B-school professors teach that "sometimes it's all right to beat up on people, be a martinet, crack the whip, and be a hardass," complains James O'Toole, executive director of the Leadership Institute at the University of Southern California.
EASING OFF. But some companies are starting to wise up to the problem. "Management has become sensitized to the problem that you can't ride roughshod on the work force," says Rhoda M. Powsner, chief physician for Ford Motor Co. General Electric Co. Chairman John F. Welch Jr., for instance, denounced the drill-sergeant mentality in a March letter to shareholders. "We cannot afford management styles that suppress and intimidate," he declared.
Managers who refuse to mend their ways, take note: Dee Soder, a Manhattan psychologist to senior executives, has been contacted by newly assertive outside directors to evaluate autocratic CEOs. "The outside board members are beginning to look at how the bosses are treating the employees," especially when key managers flee to the competition, Soder says. How frequently will outside directors clamp down on abuses? That's anyone's guess. But if they don't act, juries might. And the price tag may be higher than executives ever imagined.Elizabeth Lesly in Washington