No one likes being lied to. It’s deceitful and disrespectful, especially when it happens on the job. But, the truth is…lying in the workplace happens.

I’ve seen it over and over again with big and small companies—and, increasingly, during challenging times. In the face of bad news, there is a tendency for leaders to soften the blow by not fully disclosing how tough business really is, how sales have dropped or how customer complaints have climbed.

It reminds me of one of my favorite episodes of “Mad Men” when Jon Hamm’s character, advertising exec Don Draper, convenes an all-employee meeting to announce the crushing blow of losing the firm’s largest client. His message to the troops: “Nothing should change. Nothing will change.”  Of course, things did change, quickly—namely, layoffs and cash flow woes.

Less-than-truthful communication is a surefire trigger for zapping trust in the workplace. And, believe me, the degree of difficulty required to rebuild lost trust is far greater than communicating honestly and frankly about a lost contract or disgruntled client in the first place.

Don’t underestimate the ability of people to accept reality and rally in the face of adversity. Straight talk fosters respect. So with that said, here are seven tips to help leaders tell it like it is, even during the most difficult times:

No. 1: Don’t own it all. Whether you are a small business owner or vice president in a large corporation, the challenges and setbacks of business are not yours to own alone. Every member of the team contributes to the performance of the company (and if that’s not true, question seriously why you have someone on your team who doesn’t add value). Employees need to feel your disappointment and understand their role in the recovery – especially if you are going to call on them to work longer hours or fewer hours or do more with less.  

No. 2: Communicate often.  Strike a rhythm of ongoing formal and informal conversations about the company with small and large groups of employees.  Don’t hold a big meeting with a big message and go dark for three months. “Be upfront with employees and create an open dialogue environment” was among the leading recommendations in a recent poll of FoxBusiness.com readers conducted by my firm about truth—and lying—in the workplace.

No.  3: Present the facts.  Don’t bombard people with voluminous, flashy presentation decks or hefty files of spreadsheets. Find a few stats that illustrate the story of change and challenge. Use visuals, like arrows and colors, to illustrate performance changes. A red, downward-pointed arrow universally signals negative performance—a cause for concern!  Skip the MBA lingo and stick to simple words. Strive to educate employees about the reality of the situation and how they can help make things better.

No. 4: Highlight sensitive information.  Whenever you discuss “company sensitive” information, explain the reason for sharing it and the high level of trust you have in your team to handle it properly.  Stamp conversations with the same “company sensitive” message that accompanies sales reports and financial documents.

No. 5: Strike a balance. Don’t go overboard with doom and gloom. Balance the message of what’s not going well with comments about positive performance areas. Publically recognize great teamwork, where associates are going above and beyond to fix problems and support customers. Sincere words of appreciation, accompanied by a firm hand shake and pat on the back, are the most powerful perks that a boss can give.

No. 6: Coach people to act responsibly. Many leaders stifle bad news because they don’t want workers to spread the word to clients and other external stakeholders. Avoid damaging leaks by helping employees understand their responsibility for handling performance data.  Explain the risks of a tell-all posting on Facebook or sidebar conversation in the supermarket check-out line. Open, honest discussions about the business can foster a strong personal connection that gets people talking about “my company” and “we” instead of “they” and “them.”

No. 7: Explain limits. Some information will need to be withheld. When pressed to comment or reveal off-limits information, just say no. Confidently explain, “For various reasons, that is topic that I cannot discuss at this time.”  Then move the focus to information that you can share.

Linda Dulye is internationally recognized for helping many companies go spectator free. A former communications leader for GE and Allied Signal, Linda established Dulye & Co.   in 1998 with a practical, process-driven approach for improving communications and collaboration through an engaged workforce— a formidable competitive advantage, that she calls a Spectator-Free Workplace™.