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Exploitative leadership, as a negative leadership style, directly harms targeted subordinates while indirectly affecting bystanders. Moreover, unlike prior literature that has focused more on employees' moral outrage and schadenfreude toward such incidents. This study, grounded in Social Information Processing Theory (SIPT), shifts the focus to the bystander perspective, examining how witnessing such behavior leads to distinct perceptual changes among employees-specifically, job insecurity. A dual research design ensures external and internal validity: Study 1 employs a two-stage questionnaire survey with 230 Chinese employees, while Study 2 conducts a situational experiment involving 162 participants with work experience. Research results show that exploitative leadership significantly aggravates the work insecurity of bystanders, and the psychological contracts breach plays an intermediary role. The leader-member exchange (LMX) relationship regulates this impact: a high-quality LMX relationship can reduce individuals' susceptibility to exploitative leaders. This study introduces the perspective of bystanders and constructs a theoretical framework and clarifies how exploitative leaders can cause the occupational insecurity of bystanders' employees in specific situations. This broadens the research perspective on exploitative leadership and highlights its spillover effect on the organization. This helps enterprises recognize the profound impact of exploitative leadership, thus promoting the long-term development of enterprises.
Li et al. (Mon,) studied this question.