Whenever I hear a kid tell another kid to,"shut up," I try to reason with them:
I would get fired if I went around telling kids to, "shut up." If I can't say it, you FOR SURE can't say it.
If I hear a kid cursing, I ask them if they want to tell the curse word to their grandma over the phone. Usually, they decline. I tell them to only use words that they would use if their grandma was at school with them.