Wilber always arrives late. Margareta constantly badmouths her employer. Joseph talks over others in meetings.

Welcome to the employees from hell. Their toxicity creates a negative workplace, causes co-worker resignations and threatens the bottom lines of the best businesses.

What to do? Here are the actions supervisors can take to turn negative workers into positive performers.

1. Wilber is chronically late for work—and always has a good excuse.

Chronic lateness inconveniences colleagues and creates a dysfunctional workplace. “Dealing effectively with Wilber is a two-step process,” says Eric Cormier, manager of HR Services at Insperity. “The first is ...