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This week, a close friend sat across from me with tears in his eyes. He had worked hard, delivered what was asked of him, and yet found himself stripped of his salary because of a supervisor’s unfair judgment. Instead of accountability, he was met with defensiveness. Instead of support, he was left feeling powerless. As an HR consultant, I could guide him through the process, but I could not erase the deeper wound. The deep cuts due to the feeling that in his company, people did not matter.
His question to me has not left my mind: “Is the salary still worth it if you’re treated unfairly?”
HIDDEN TAX OF HARASSMENT
We often treat money as the ultimate motivator. Yet no paycheck is large enough to outweigh the damage of working in an environment where harassment, bias, or hostility festers. Economists call this the hidden tax of toxic workplaces. It drains energy, stifles creativity, and ultimately eats away at profitability. Employees under constant stress eventually disengage. Turnover rises. Recruitment costs balloon.
Gallup’s State of the Global Workplace report puts a staggering price tag on it. Disengagement and toxic cultures cost the global economy more than US$8.8 trillion (S$11.3 trillion) every year. That figure is not abstract. It shows up in weaker quarterly earnings, missed growth targets, and declining valuations.
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LEGAL AND FINANCIAL SHIFTS
Singapore has been moving decisively to confront this challenge. The Ministry of Manpower (MOM) defines workplace harassment as behavior that causes alarm, distress, or intimidation, from threatening language to cyberbullying, stalking, and sexual harassment. This is not only an HR problem. It is a matter of compliance, governance, and risk management.
The Protection from Harassment Act (POHA), in place since 2014, already gave victims civil and criminal remedies whether harassment occurred in person or online. The new Workplace Fairness Act (WFA) 2024 goes further by outlawing discrimination and requiring employers to build grievance-handling systems. Unlike earlier guidelines, this law has teeth. It allows enforcement action now and private legal claims in the near future.
For businesses, the message is clear: failure to act fairly is no longer just a reputational stain. It can become a balance sheet liability.
WHY INVESTORS SHOULD PAY ATTENTION
Investors understand risk, and workplace culture is increasingly recognized as a material one. A company that tolerates harassment, drives attrition, or attracts lawsuits is a company that risks underperforming peers. Today’s ESG-conscious funds, which control trillions in assets, specifically screen for social and governance issues. When a company fails its employees, it often fails the very metrics that dictate whether capital flows in or out.
Workplace toxicity does not just harm people. It weakens profitability. It shows up in mounting legal expenses, lower productivity, shrinking margins, and weaker shareholder returns. It can depress valuations, complicate mergers, and even close off access to ESG-linked financing.
McKinsey research makes the financial case unmistakable. Companies that prioritize fairness and inclusion outperform their peers by as much as 25% in profitability. Fairness is not a soft, optional value. It is a measurable driver of enterprise value.
A NEW DEFINITION OF VALUE
When my friend asked if his paycheck was worth the humiliation, what he was really asking about was value. A salary can cover rent, groceries, and bills. But it cannot compensate for lost dignity or the fear of speaking up. For employers, the deeper question is whether they can afford the risks of ignoring fairness. For investors, the real issue is whether they should back companies that allow toxic cultures to persist.
The truth is becoming clearer. The companies that will last are the ones that treat fairness not as charity but as strategy. Workplaces that respect employees protect themselves from legal threats, secure investor confidence, and strengthen long-term valuation. They build resilience, loyalty, and brand equity that money alone cannot buy.
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At the end of the day, the companies worth working for (and worth investing in) are not the ones that simply pay the most. They are the ones that value people the most.
