An NHS trust has been told to promote a culture of zero tolerance to bullying and harassment of staff.
The report found perceptions of bullying were particularly high
The Healthcare Commission launched an inquiry after claims of bullying came from staff and a GP at East Sussex Hospitals NHS Trust.
It found perception of the problem was high, but uncovered no evidence to show that the actual number of allegations was higher than similar-sized trusts.
The trust said it welcomed the report and had agreed an action plan.
The report said trust managers had not taken action to find out about perceptions of bullying in order to deal with them properly.
Commission spokeswoman Marcia Fry said: "Staff are an organisation's most important asset and is fundamental they should be treated with respect."
She said a "clear and consistent approach" to staff grievances would help provide a good working environment that would lead to a better service for patients.
During the investigation, 46 out of 5,000 employees said they had been bullied or harassed.
NHS Trust chairman John Lewis said changes were already under way after the investigation in April 2005.
He said the trust now had a new senior management structure.
He added: "Work is already under way to improve dignity at work for all our employees and create a more open and supportive organisation where staff can raise concerns."
Chief executive Kim Hodgson said the report helped in "drawing a line under some historical issues".
Norman Baker, Lewes MP, said it had brought the management of the trust at the time of the inquiry into question.
He said: "There is no doubt that reports like this are damaging to public confidence in the NHS."
He is discussing the report with the trust's chief executive on Friday.