I had my immediate report and the CEO talking to me. "We would like to keep you, but..."
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Deep down, I was aware that it's a toxic management company. I kinda got used to it over the years. I had 6 manager in the past 5 years, they were coming and going. Each one with different requirements on Project management tools, one wanted constant booking of hours, the other was the CEO himself, who was managing us without being in the office for a full day in a week, and not responding to emails.
Bad coworkers come and go. They become a problem when the boss lets them. In which case, the boss is a bigger problem and that is difficult to fix.
Sounds like your ceo is the problem. Lots of turnover in a small company and siding with someone who has been there 1/5 as long as you is not a good sign.
Some prospective employeers look at how long you typically stay at jobs and ask why you left. I think prospective employees should be asking how many staff are employeed on average, how many leave each year and why they left.
The 2 worst places I worked had high turnover. Vastly higher than other places I worked. At both of them, I regretted not leaving as quickly as my coworkers. I'm actually still at one of them. The ceo was recently let go and things seem to be improving but I still think I'd have been better off leaving long ago.
I think 5 years is plenty and I don't think potential employeers will scrutinize the reason you left. If you feel the need to explain, I wouldn't get into the drama and specifics, just mentioning how high their management turnover was should suffice. That could backfire though, if they suspect you were the cause of the high turnover. Complimenting the ones that left could help eas those suspicions. Perhaps one of them could be a reference for you instead of one of the toxic ones that are still there.
It may be frustrating to let this bad coworker cause a change of employement but hopefully in the long run, their impact on your life will be positive. Maybe they will motivate you to leave that toxic company and find a better one.