🚩 Red flags to look for in companies
Don't be tricked into a toxic environment. Read company behaviors while interviewing and uncover their true culture.
Last week, we talked about 🚩 Red flags that companies look out for to help you present your best selves during the interview process. But the interview process is a two-way street; we need and deserve to find an ideal environment where we spent a good chunk of our life (at least, avoid the most problematic ones). This week, we’re gonna talk about those red flags to spot in your future employers, featuring the latest Sifted article on toxic startup environments.
First, no company is perfect
Before diving into the flags, it’s important to understand that even the best companies are flawed. They’re run by people, after all. As covered in Interview the company like they interview you, write down what you look for in a future employer, and rank what’s important to you. Prioritize the most important things, whether it’s growth opportunities or work life balance, and focus on those.
Having hired for half a dozen startups, these are the top red flags that jobseekers should look out for, as they represent some of the most deep-rooted and hardest to fix problems.
No diversity in management team: 🚩🚩🚩🚩*
*This one was only 4 flags and not 5 because some management teams could be taking action to improve diversity.
Emphasis on “management team”, because plenty of tech companies love using stock images of people of different genders and ethnicities or post team photos with their female and people of color employees. But when it comes to the people who really make important decisions, we see the opposite picture.
And we are not just talking about race and gender here. A lot of these startup founders all went to the same Ivy League school and came from very privileged backgrounds. The problems this can lead to fill a long list: less openminded for new ideas, lack of empathy for the diverse employee and customer needs, longterm “diversity debt” as the one startup debt you can’t pay back… I’m sure the women of color readers don’t need to be convinced.
But for the white, straight men reading this — a lack of diversity will affect you too. Your BIPOC colleagues are just first to feel it. If the management team discriminates your colleagues based on their skin, gender, sexual orientation, economic background and other arbitrary reasons, they’ll eventually do the same to you.
High turnover rate: 🚩🚩
Turnover rate is the rate at which employee leave a company for any reason. You want to make sure to find a company that not only can attract great employees, but also keep them. After all, the interview process is only a few hours, the stay at the company might be a few years.
However, one thing to note is that turnover rate alone might not explain the whole picture. The pandemic has significantly brought up turnover rates overall. Sometimes a high turnover rate could just be a growing pain for an up and rising startup: maybe they let go of employees that were a bad fit or toxic. Different teams within the same company could also have different turnover rates (I can think of many companies with great engineering/product/marketing teams but awful talent acquisition/HR teams).
Poor review, reward & feedback structure: 🚩🚩🚩🚩🚩
Not a lot of candidates I’ve spoken to ask about this in-depth, but a great performance review, reward (recognition, promotion, raise), and feedback structure is crucial to a healthy career growth.
Ask companies these questions:
How often do performance reviews take place? How are they structured?
(to interviewer) What were some of the most helpful feedback you received?
How are employees recognized for their work?
How often do promotion conversations happen?
What does the career path for this role look like?
Note: structure ≠ culture. I hear candidates ask about feedback culture before. Any company could easily say they have good feedback culture because everyone’s open-minded, but that doesn’t help us. It’s not the employees’ individual responsibilities to take feedback, the company needs to embrace and implement structures in place.
Lack of transparency: 🚩🚩🚩🚩
Transparency in company wide decision-making is crucial. In companies where employees feel like they’re more aligned and included, there are always good practices where the management team makes sure to communicate decisions clearly and the thinking behind it. After all, the company’s not just serving its customers, but also its employees. Good examples of transparency include:
Weekly or biweekly company town hall meetings, where there’s direct communication between management, C-levels and the team members;
In the remote setup, frequent written company updates and announcements by management on Slack;
Regular employee engagement survey and action taken based on the survey results;
Depending on the size of the company, but if they’re under 200 people, it’s a good sign if there’s always a direct communication channel to the CEO.
Bonus: something that seems like a red flag but probably isn’t
Slow responses in interview process
Of course, you should expect that the company doesn’t ghost you and communicates any interview process updates once a week or so. BUT, almost all recruiting teams I’ve seen are overworked and understaffed. One recruiter could work on between 5-30 roles at any given point. And imagine they could receive 50-500 application per role, it quickly adds up.
Summer months are also notorious bad for hiring because everyone’s on holiday. In most interview processes, even if one interviewer goes on holiday, it could create significant delay. So if you slipped through the cracks, give them some time to get their stuff together. I on behalf of all recruiters will be so grateful if we don’t get emails every two days about an update.
Luckily my delayed issue this week coincided with Sifted’s latest article on toxic work environments: “Humiliated for my sexuality”, “Fired for being dyslexic”: Sifted readers share their experiences of toxic workplaces. These crazy stories are, sadly, shocking but also not surprising.