To operate honestly and to demonstrate transparency, we should be timely and clear when communicating bad news but present recommendations for remediation along with the bad news itself.
With disgruntled employees we should make efforts to understand what might be causing the discontent and then (to the extent of our influence and ability) seek to address the cause.
The last is a question of integrity. One example I have is when I'd made a verbal offer to a prospective candidate on a project I was leading only to have a friend of mine who I knew could do a better job approach me at the 11th hour. I could have made some excuse for turning down the first candidate in favor of my friend, but did the right thing by honoring the verbal commitment I'd made.