Enemies to Allies: 6 Ways Employee Relationships Affect the Workplace

In “Enemies to Allies: 6 Ways Employee Relationships Affect the Workplace”, Michael Housman explores how social relationships at work—both positive and negative—shape employee behavior, performance, and retention. Drawing on research conducted with Cornerstone OnDemand and Northwestern University, the article provides quantitative evidence for the long-held belief that no employee operates in isolation.

Central to the discussion is the report Toxic Employees in the Workplace, which finds that roughly 3–5 percent of employees are terminated for toxic behaviors such as misconduct, workplace violence, substance abuse, or harassment. While this group is small, their impact is outsized: toxic employees significantly increase the likelihood that nearby coworkers will also behave poorly—or leave the organization altogether.

This research is part of a broader body of work examining what Housman calls the “friendship effect”—the idea that the social fabric of work is just as critical to employee tenure and performance as the tasks themselves. The presence or absence of healthy relationships shapes how long employees stay, how well they perform, and how likely they are to engage in misconduct.

The article outlines six ways employee relationships influence the workplace.

First, toxic coworkers increase turnover. Employees are up to 54 percent more likely to quit when the proportion of toxic team members increases by just one person on a team of 20.

Second, referred employees make better hires. Research conducted with the University of Toronto’s Rotman School of Management shows that referred employees are 8–20 percent less likely to quit and are often less prone to certain forms of workplace misbehavior. In some industries, they are also more productive.

Third, having friends at work improves retention. In a study of 20,000 employees, those who knew three or more coworkers at their company stayed significantly longer than those with fewer social connections.

Fourth, social networking predicts performance. Employees in frontline service roles who actively used up to four social networks converted more sales, resolved customer issues faster, and remained with the company longer than those who used none.

Fifth, social environments improve training outcomes. In a study on trainer effectiveness, classrooms that fostered camaraderie and engagement produced employee tenure that was two to three times longer than groups trained in less social settings.

Sixth, supervisors matter more than anything else. Tracking 1,400 supervisors and 30,000 employees revealed that an employee’s first supervisor has the strongest long-term impact on performance and tenure. Early manager–employee relationships set the trajectory for future success.

The article concludes by emphasizing how modern data and analytics allow organizations to put the “friendship effect” into practice. During hiring, science-based assessments can help identify candidates who are not only qualified, but also less likely to engage in toxic behavior. Cornerstone’s research shows that candidates rated as highly qualified are 19 percent less likely to be terminated for policy violations.

Beyond hiring, analytics can guide initiatives that strengthen workplace relationships, such as mentorship programs, community lunches, and informal social events. When designed thoughtfully and evaluated with data, these efforts can meaningfully improve employee tenure and performance.

Ultimately, the research underscores a simple conclusion: workplace relationships are not a “soft” issue. They are a measurable, manageable driver of organizational performance—and one that companies can no longer afford to ignore.