Sharon,
I saw the behavior that you outline above in the federal government ranks and as the Commander of the organization I had to confront inappropriate behavior. Once people understand that the supervisor is going to check the little things and confront those that appear to take advantage of the system, they police themselves and each other. And once you promote those who are diligently trying to do the best they can, it sends a signal throughout the rest of the organization. In the civilian sector a supervisor can also stop this behavior by being aware and making sure his/her subordinates know what is expected.