How do you deal with bosses who are bullies?

It is unclear whether you are asking the question from the vantage point of the boss' manager or from the vantage point of the employee being bullied. In either case, we should be clear that bullying may take many forms. Overt bullying ,such as fits of temper, abusive language and intimidation via threats or physical tactics is usually behavior that has been allowed to thrive over time and will only stop when the bully believes his or her job is truly endangered by the conduct. An employee confronting this type of bully will likely not be successful, nor will reporting the bully to HR, because it is likely HR knows about this conduct and has found it either politically imprudent or simply not in management's interest to stop the conduct. So, the only hook I have seen be effective is to let the individual know the likely consequences of continuing the behavior (in your case, letting the individual know he or she is inches from a harassment complaint,) but it is not likely to work absent a real complaint and the capacity to uphold the policy.

A subtle bully -- the one who quietly undermines and targets an individual by diminishing their reputation, sabotaging them or spreading false information about them is a different kettle of fish. This kind of bully is often under the radar of management and will not be found "harassing" due to subtle conduct.. Unfortunately, their targets are so reputationally damaged by the time they complain that gaining credibility is difficult. With this type of bully, documentation is important, as is finding other who have experienced the same treatment. Those who have left the bully's area in the past several years often can vouch for the behavior, and with evidence of patterned practice, the target can SOMETIMES get the attention of management.

Bullies thrive in organizations that value shrewd politicians over substantive contributors and production over people. Some have perfunctory policies that are not enforced. If one works in an organization that has committed to a respectful work environment and bullying conduct emerges, one can confidently assert themselves and know they will be supported -- you will know this is the strategy to take when you have seen it work for others, and where your senior level management has supported others in objecting to inhumane treatment. Culture trumps policy every time!

Yes, we run into bullies all the time in our roles. Physical and vocal bullying are the most obvious and maybe not the worst forms that I have seen.
More subtle ones are the manipulators who use information to serve personal gain, the emotional subterfugers who make others feel bad or beholden based on favors or mistakes blown out of context, the toxic pretenders who laugh while they stick a barb in you and disguise it as fun, and the intellectual over-bearers who deluge others with their intellect and knowledge.
Each of these bullies uses different power bases to manipulate others and get their way.

"As the old saying goes an Empty Can can create more noise"

Bulies are best approach head on and can be tamed by finding their weakness. Their means of confrontation is an actual representation of insecurities.. If you put an empty can inside a big can and fill up the the space in between.. it insulates the noise - (i.e control and policies)

Sorry to hear about this situation Chad. I always figure that life is too short to work for people who don't appreciate who I am and are working out their personal problems on me. I tend to work for people who deeply appreciate and value me as a person and walk around those who just want to make someone miserable.

If you absolutely must work for this person, remember to remind yourself that their behaviors are not about you, praise yourself constantly and respectfully set boundaries on how you like to be treated. I don't advise getting into a confrontation, conflict or any argument because they rarely lead to any desirable outcome. I might also look into training options that include that person (and others) and show everyone how to lead positively and solve problems constructively.

Companies need to deal with bullies quickly and harshly period.
Companies are turning a blind eye to bullies because in their mind these people get the job done. What they do not realize is that these people are costing the company more in missed opportunities than the bullies are actually making them. The ROI just isn't there. The bully isn't about the power over someone it is about the ultimate destruction of their victim for a variety of reasons they said something the bully didn't like they are smarter than the bully etc.
The bully not only will intimidate the victim but everyone around the victim. They will endear them selves to those above them so as it looks like the victim is the troublemaker.

They cost the company in missed days, poor productivity, poor morale, higher health cost, not just for the victim but for those around the victim in stress related issues. The quality of work under these peoples management is poor and sub standard. Everyone is working in fear. I do not understand how companies see this as an advantage when their business could do much better by eliminating the problem.

I don't distinguish bullies at work from abusers elsewhere. The behavior is probably learned & supported in the larger culture as well as in business cultures that value aggressiveness & "productivity." It is also supported when we fail to teach people ways to confront conflict/abuse in proactive ways that don't allow abuse to escalate. Please see: http://docpegisin.com/?p=756

It is normal to want to avoid unpleasant confrontations or unpleasant individuals , most folks are civilised in the work the place and expect to be treated in a civilised way. So it is perplexing when confronted with an individual who isnt "house trained" .

If the culture condones or ignores the behaviour or sees it as an acceptable route to acheive a result there is little chance a fair hearing is going to happen. An inclusive consultative culture which makes the most of and values everybodys varied talents is in my experience a culture which breeds pride in ones work, a sense of ownership where initiative is valued and contributes to a responsive, flexible productive organisation. I expect work associates to challenge me when they think I am wrong or am about to make a bad decision, on the proviso once we have discussed a balanced course of action everybody supports the decision in its implementation. Equally the rule should be if it goes wrong the the boss takes the hit not the staff. Bullying in all its forms is indicative of badly managed unresponsive organisation which doesnt make the most of its people which as the cliche goes are its greatest asset.

The options are record it, prove it, confront it, demand a solution and if you dont get a solution or a hearing move on to a better organisation.

nice metaphor L'Jhun :-} very nice.