I really think this is a poor phrasing as it has negative connotations. Same with “brutal honesty” which is often used as an excuse to throw out empathy.

Treating people well is not at odds with being honest and clear. If anything, it’s kinder to bring up issues early, no matter how painful it might be.

My observation had been many people who become managers lack the necessary social skills to do a good job. They do not have the context to understand what not “sugarcoating” actually means. Instead they take the easy half the advice and implement it badly.