One of the biggest complaints employees have about their managers is that they play favorites. Employees say rewards and consequences are not handed out equally, and not everyone is held to the same standards. What is interesting is when managers are shown these findings they usually agree with the employees. Managers admit they have favorites and do not treat everyone the same, even though they know they should.

This creates favoritism in the workplace. We all have experienced it and know what favoritism is – it is when someone is singled out as special. He is perceived as better than other workers even though usually he is equally, or only slightly more, skilled as they are. In some cases, he is even less skilled than his co-workers, but is still seen as special for other reasons.

When employees are working with someone who has been singled out as a superstar it creates a damaging work atmosphere, which can hurt a business’s success. Over the years, thousands of companies have been harmed or gone out of Business because of favoritism. Here are 3 reasons why.

1. Legal problems: This one should not have to be said, and yet it must be said – all the time. Hundreds of small businesses have been bankrupted because they did not treat all their employees equally. It is simple – employees sue, employees win and the company is out of business or severely compromised.

2. Lowers employee morale: It is true, one favored apple can and will spoil the whole barrel. Having one, or more, identified favorite can ruin a whole company’s morale, especially in small businesses where the impact is greater. The fewer the people, the more likely favoring one person over the others will negatively affect the whole group.

A fundamental human principle is – People do not like to be treated unfairly. Starting from childhood we react strongly to a person, situation or idea that we think is unfair. It is also one of the most common reasons people leave a job. They get tired of being treated poorly, not having their ideas listened to and managers Playing Favorites.

If employees are not able to leave a job physically they will leave mentally; and, this is when morale and motivation really start to drop. When they feel their ideas and skills are not valued, they give up. And, when people give up productivity, quality and innovation suffer. “Why bother, what I think doesn’t matter” are words you do not want your employees to say or believe.

3. Good workers leave: One of the reasons that having a favorite is so destructive to a workplace is the amount of attention he gets. Positive attention matters, it is the best way to motivate others. Employees have the expectation that their good work should get them a certain amount of good attention. But, the favorite often gets more attention for slightly better, the same or worse work while others go without attention.

When the favorite gets more notice it causes turmoil, jealousy, and resentment in others. Over time even the most levelheaded employee becomes affected by it – good, solid performers start to become discouraged, annoyed and fed up. Good workers have options and they take their skills to another company where they are appreciated and fairly rewarded.

There are very few superstars in business and chances are there are none in your company, including your favorites. Avoid the problems of favoritism by learning how to set up a transparent system, which ties rewards and consequences to performance only. It will go a long way toward having less risk, a smoother running operation and happier employees.

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