How much is bullying and harassment costing employers?

Bullying and harassment in workplaces cost employers $1.34 billion between 2021 to 2022 - and it could hit $1.5 billion in 2023.

This is according to a new report from the New Zealand Human Rights Commission with KPMG.

"This is a milestone-setting report that should wake employers up to the need to provide safe and supportive workplaces," Equal Employment Opportunities Commissioner Saunoamaali'i Karanina Sumeo in a statement.

According to the report, the $1.34 billion is a conservative estimate of the economic costs for employers, who suffer from increased use of sick and annual leave, higher turnover rates, increased time spent on addressing internal complaints, and decreased work performance due to bullying and harassment.

"The report has taken a conservative approach throughout and excludes other impacts on employers not supported by reliable data. The actual economic cost is likely much higher," it read.

_{Source: Counting the Cost: Estimating the economic cost of workplace bullying and harassment on New Zealand employers}

Cost of bullying, harassment

On average, it costs employers $1,618 per employee affected by bullying and harassment, which balloons to the overall cost of $1.34 billion.

"These are combined cost estimates for all three kinds of negative workplace behaviours - sexual harassment, racial harassment, and bullying," the report read.

Nearly half (42%) of the total is driven by turnover and replacement of affected workers, after nearly one in six employees chose to resign after suffering from a negative experience.

As a result, employers have to shoulder the cost of termination and recruitment cost, as well as short-term reduced productivity amid replacement.

Other consequences of bullying and harassment include absenteeism, presenteeism, and internal procedures, according to the report.

_{Source: Counting the Cost: Estimating the economic cost of workplace bullying and harassment on New Zealand employers}

Women are also "disproportionately affected," after the report found that $780 million of the total cost arises from the impact of bullying and harassment on women.

Addressing bullying, harassment

Sumeo said New Zealand will be "better off" if employers act now to prevent bullying and harassment.

According to the report, some of the measures that employers can take to respond to bullying and harassment include:

• Establishing well-defined policies and procedures to prevent and respond to such incidents
• Implementing comprehensive training programmes for employees and managers to create awareness, promote prevention, and develop a culture of respect and inclusivity within the workplace
• Fostering an open and supportive environment where employees feel safe reporting incidents, have access to independent complaints services, and where workplace investigations are prompt

"Being safe at work is a human right for all of us, and under Te Tiriti o Waitangi the dignity and mana of Māori must be upheld at all times including in the workplace," Sumeo said.