When a leader plays loose with his integrity, these things start to suffer.
Here’s a common example for a small business. The law has certain tests to determine whether or not an employee is exempt or non-exempt under the Fair Labor Standards Act. Classifying an employee who is clearly non-exempt (e.g. entitled to overtime pay) as exempt — so that the owner can get away with making her work lots of hours without paying overtime — is clearly dishonest.
The owner can probably get away with it, but at least one other person in the company will also know that he did it.
That person will learn that dishonesty and expediency is approved behavior ("If the boss can do it, so can I"). That doesn’t mean that she will act dishonestly, but the owner has implicitly approved it.
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