How Managers Can Navigate Toxic Behavior and Build Healthier Teams

Managing people is one of the most rewarding parts of leadership, but it also comes with emotional landmines. Whether it’s handling a difficult colleague, managing your own reactivity, or leading a team through tension, toxic behaviors in the workplace are among the most complex challenges managers face.

Leadership psychologist Dr. Sheela Reddy offers insights that every manager should hear. With over 25 years of experience in trauma-informed leadership and emotional intelligence, she breaks down where toxic behaviors come from, why they persist, and how managers can respond not with avoidance or aggression, but with awareness, clarity, and purpose.

Here’s what I learned from her about what you can do about it in your workplace.

Understanding the Roots of Toxic Behavior

We often label difficult coworkers as “toxic” without understanding the full picture. According to Sheela, toxic behaviors in the workplace can be better understood through the lens of the “Dark Triad,” a psychological framework that includes narcissism, Machiavellianism, and psychopathy.

Narcissism shows up as self-importance, a lack of empathy, and a need for constant praise. Machiavellianism involves manipulation and deceit for personal gain. Psychopathy includes emotional coldness, impulsivity, and an absence of guilt. These traits can be especially dangerous when combined with intelligence and charisma, which often masks the underlying dysfunction, at least initially.

But not all toxic behavior stems from deep-seated personality disorders. Sheela introduces a more compassionate view: many toxic actions originate from learned behaviors, trauma, or an inability to regulate stress. Sometimes, people act out because they’ve never developed emotional awareness or distress tolerance. That doesn’t excuse poor behavior, but it does shift the conversation from blame to understanding and action.

The Gray Zone: When Good People Behave Badly

Toxicity isn’t always extreme. In fact, much of what managers encounter lives in what Sheela calls the “gray zone.” These are the everyday moments when people, including ourselves, act out of fear, stress, or insecurity.

Perhaps someone commits to a deadline they can’t meet just to avoid conflict. Or a team member constantly seeks validation because they doubt their own worth. These aren't necessarily manipulative or abusive, but they can still erode trust and collaboration over time.

Managers should learn to recognize these patterns, not to judge, but to respond more effectively. This begins with emotional awareness: being able to name what’s happening, why it’s happening, and what it might be signaling.

Why Distress Tolerance Is Critical

One of the most powerful skills a manager can develop, Sheela explains, is distress tolerance, the ability to sit with discomfort without reacting impulsively. Many toxic behaviors are born from an inability to manage difficult emotions. When a meeting goes off the rails or a conversation becomes tense, some people shut down, lash out, or avoid entirely.

The goal isn’t to suppress emotions but to learn how to stay grounded in the midst of them. As Sheela puts it, “You cannot regulate or change an emotion without actually sitting with discomfort.”

She goes on to note that it helps to remember that distress is temporary. It might be pointing you to something valuable, perhaps a boundary you need to set or a purpose you need to protect. Being able to pause, breathe, and reflect in those moments gives you a chance to choose your response rather than be controlled by your reaction.

Navigating Difficult Dynamics at Work

So, what should you do if someone on your team or even your boss is exhibiting harmful behaviors?

First, recognize the power dynamics at play. If the other person holds more formal authority, direct confrontation may not always be safe or productive. In those cases,  Sheela suggests documentation becomes your ally. Keep written records of key conversations, agreements, and feedback to protect yourself from gaslighting or denial.

It’s also essential to emotionally separate yourself from the toxicity. As Sheela explains, many people who create stress are actually deeply stressed themselves. Their reactivity is often a projection of their internal chaos, not a reflection of your worth or contribution.

Visualizing a psychological “barrier” between you and the person can help you stay grounded. And when tensions rise, your first step should always be to calm your body. Long, deep breaths and self-talk can re-engage your logical brain and help you respond rather than react.

Sheela even recommends using a parenting metaphor: Imagine the person as a five-year-old throwing a tantrum. If you wouldn’t let a child’s outburst derail your calm, don’t let an adult’s emotional volatility do it either.

In addition, it helps to know what you stand for. Clarity around what you’re trying to build, your purpose and values, or what kind of leader you want to be, make it easier to act with integrity even when it’s hard.

This doesn't mean you won’t feel discomfort. It just means you're able to endure it for the sake of something more meaningful.

Dealing with toxic behavior at work is hard. But managers are not powerless. By developing emotional intelligence, increasing your awareness, and anchoring yourself in purpose, you can create a healthier environment for yourself and your team.

Not all behavior can be changed. Not every dynamic can be healed. But what you can always control is how you respond. And the more emotionally grounded, clear, and intentional you become, the more you lead with strength, not just strategy.

Listen to the entire episode HERE to learn more about navigating toxic behavior and building healthier teams.

Keep up with Dr. Sheela Reddy

• Follow Sheela on Instagram

• Check out Rise Mind’s official website for more information here

• Continue your growth journey with Sheela’s podcast, RISEMIND - EQ Evolution 

• Join Dr. Sheela Reddy every other Thursday at 12:30 PM ET or Friday at 12:00 PM ET for free live sessions on LinkedIn. Explore various EQ abilities and practical tips to help you manage stress, improve your mood, and strengthen your relationships. Connect with Sheela on LinkedIn to join!

FREE EQ Assessment and Tame the Tough Boss Article

Members of Podcast+ get two amazing bonuses from Sheela this week: a FREE EQ Assessment and Tame the Tough Boss Article.

The first 20 members to sign up will receive a complimentary EQi 2.0 assessment (a $100 value!) followed by an exclusive group consultation. During this session, we'll delve into your personalized results, providing you with actionable tips to boost your EQ for personal and professional success.

And, get practical strategies to navigate challenging professional relationships with Sheela’s article: "Tired of Walking on Eggshells? How to Manage Your Difficult Boss (Without Getting Fired)." 

To get this bonus and many other member benefits, become a member of The Modern Manager Podcast+ Community.

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The Modern Manager is a leadership podcast for rockstar managers who want to create a working environment where people thrive, and great work gets done.

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