Burnout is not just something that happens. It is often caused either through overwhelming work environments or self-expectations of perfection. Either way, burnout can harm both the person and the company they work for. It is easy to see how burnout can harm a person. It drains them, lowers hope, and increases frustration. However, I have rarely seen research that supported the effect this has on a business’s bottom line until now.
Research through a simulation developed by Public Health Informatics, Computational, and Operations Research at CUNY Graduate School of Public Health and Health Policy working with other prominent institutions found that employee burnout can cost a company between $4,000-$21,000 per employee depending on the level of the employee. A company with 1,000 employees might lose as much as $5.04 million dollars per year.
This research shows the negative effect of burnout on a business in everyday operations. Other studies show the effect of burnout on quality of life for the individual person. We might also see the future show legal consequences for businesses that have a fiduciary duty to their shareholders to not burnout employees and incur these costs. Perhaps further study would show a financial obligation for damages to shareholders and stakeholders of a company. Damages are more easily sought when they can be quantified.
Burnout is ethically never something that should be sought. However, many businesses today seek to squeeze what they can from their employees with the expectation of releasing said employee when their productivity wanes. We can see this in the model of large corporations, who are so famous for turning and burning employees in the delivery sector that news articles discussed them running out of people to hire. Imagine lawsuits for damages and disability on top of not having anyone left to take the job.
Perhaps burnout should be classified as a disability. It certainly is an emotional toll developed through the process of unhealthy working practices and environments. Being physically harmed at work leads to compensation; why would emotional harm not also provide the same protections from abuse? The WHO recognizes burnout as a disability, but that doesn’t mean we are there yet legally. I’m no lawyer. Here is a discussion of this legal idea by lawyers.
I would not look to purposefully cause burnout as a business owner. It will only cost money in the performance and quality of any workers. It puts you at risk of lawsuits, whether legal consequences currently exist or not yet. It is wholly unethical to purposefully create these environments. It goes against the fiduciary duty of a business owner to their stakeholders. You could run out of people to hire. Burnout is just bad business.