If you screw up then you usually learn something, and that’s what you’re paying for. The ones who never make mistakes obviously don’t need a teacher, so why the hell are they throwing the money away? How stupid is that?
I’ll usually smile at mistakes, but tell the class not to laugh at anyone (except me) - to the point of being stern with the worst offenders. Often the laughter is relief at not being the one making a fool of yourself, so the sudden realisation that they might be next is enough to make most of them bite their tongues.
I’m always making mistakes on purpose, telling funny stories about how I called my mother a horse in a chinese lesson etc., to raise a laugh and make it OK to make mistakes. If there is a lot of laughter in the class anyway then students will often join in with smiling at their own mistakes, especially with a little positive reinforcement. If they can correct themselves, or you can show them where they went wrong, then try publicly congratulating them for getting their money’s worth out of you.
OK Joe, well done. You learned something tonight so you can go home. (more laughter) What about you (laughing dude)? What have you learned? Nothing? Why are you here? Don’t you need the money?
Now who are we laughing at? Next time around all it takes is a stern look. My adults are generally lacking in confidence, but don’t give each other a hard time. The Junior High kids will still give it a go (usually) but are the worst for being cruel to each other.
At Senior High School level (lower ability groups) I’ve encountered the opposite problem. A student came to me to complain about his low grade for conversation, which was based on his performance in class. It turned out that he was actually quite fluent but afraid to speak because his classmates were giving him a hard time for making them look bad.
What to do in that situation?