Table of contents
  1. What is Employee Management?
  2. Why Employee Management Matters
  3. Selecting
  4. Monitoring
  5. Interacting with your employees
  6. Rewarding
  7. Disciplining
  8. How to Improve Employee Management
  9. Conclusion

What is Employee Management?

Employee management is a broad concept that encompasses the aspects of managing your workforce to ensure that you are getting the best from them and achieving company goals. The term refers to all the tasks involved in interacting with your employees, monitoring their progress and attendance, and ensuring their wellbeing. 

When working effectively, employee management can also help your staff to progress in their careers.

The activities associated with employee management typically fall into the following categories (each will be explained in more detail below).

  • Selecting
  • Monitoring
  • Interacting
  • Rewarding
  • Disciplining

Why Employee Management Matters

There are numerous benefits to effective employee management.

Increased productivity

Employees who understand what is expected of them tend to feel confident in their roles. Such confidence could also lead to increased motivation and productivity.

To bolster your employee’s confidence in their roles, provide them with both clear instructions and constructive feedback.

Improved retention

When your people management operates well, your employees are more likely to feel content in their roles. As a result, they may be less inclined to leave your business to work for a competitor. It is well-known that improved employee retention can significantly reduce training and recruitment costs.

The 2021 Training Industry report found that companies spend an average of $1,021 per employee on training every year. 

Saves money

Effective employee management will greatly increase efficiency across your business. In turn, this will result in reduced waste of time and resources. This will save your business money in the long term.


Employee management begins before a new member of staff starts work. As an HR leader, you will be involved in finding a candidate who meets the requirements of the vacant role.

Having a hiring manager checklist can help ensure that you fulfill all your key obligations when hiring new employees.

Investing time and effort in the selection process means you are far more likely to find the right candidate for the role. Remember, making a poor choice often means that you will need to spend time and money filling the role again in the near future.


Employee monitoring involves tracking information such as working hours, holiday allowance, sickness and absences, and personnel and payroll information.

Monitoring this information can help your business operate effectively and make good use of your employees’ time.

Performance management

Keeping track of your team’s progress is integral to employee management. The goal of performance management is to help your employees reach their full potential and to add as much value as possible to your organization.

Many companies perform formal reviews of their employees. Often taking place on an annual basis, these reviews are typically documented and may score employees against certain criteria. In the interest of 360-degree feedback, you could also ask an employee’s colleagues to contribute feedback.

Once you have identified your employees’ strengths and weaknesses, you can then set goals for future development. 

Performance management may also occur through less formal one-to-one meetings between employees and their managers. Because they occur more frequently, these allow both parties to raise any day-to-day issues.

It should be noted that monitoring involves far more than checking your employees are meeting their performance targets. Effective employee management should also include checking on your employees’ levels of satisfaction and engagement. 


Remember, it is important to respect appropriate boundaries as part of the monitoring process. Whatever their workplace performance, your staff have the right to enjoy a life outside of work.

Interacting with your employees

Regular interaction with your team allows you to show that you appreciate the role they play in your business’s success. 

While communicating information to your employees is an important part of this relationship, interaction is a two-way process. Try viewing your interactions as an opportunity to ask for your employees’ opinions.

Although you may want your employees to see you as a leader, it is also important for them to regard you as friendly and approachable. 

Simple actions such as greeting your employees in the office or asking about their weekend can also improve relations. You can use these interactions to demonstrate that you have listened to—and remembered—information that your employees have shared.

The amount of interaction you have with an individual will shift during their employee lifecycle. Employees may need a high level of support on their first day or when changing roles. However, this may not be necessary on a day-to-day basis.


Recognizing and rewarding employees is one of the most important parts of the management process. 

You may choose to reward an individual—or entire team—for their efforts on a particular project. In some cases, you may decide to reward an individual for a consistently strong performance.

The type of rewards you offer will depend on the nature of your organization and your budget. 

Financial rewards

If your business can afford to offer them, financial rewards can be a great way to recognize your employees’ hard work. These rewards can take the form of bonuses, increased wages, or share options in your business.

Paid time off

If an employee has performed well, you could reward them with additional paid time off. Some companies also offer their employees a day off for their birthday.

Out-of-office perks

Recognizing your employees’ work/life balance is a key part of employee recognition. You may therefore want to introduce perks that your staff can enjoy out of working hours. This may include tickets to sporting events, the theater, or restaurant vouchers.

Flexible working

COVID-19 changed the way people all over the world work—possibly forever. Many employees are now seeking career opportunities that will accommodate other aspects of their lives, such as childcare.

Research from McKinsey and Company found that 87% of people would accept the opportunity to work flexibly if they could.

If your employees are consistently achieving their targets, you could consider offering them flexible working. This will typically allow them some degree of control over when and how they work.

Personal recognition

Not all rewards are about money. For many people, having their hard work publicly acknowledged is an effective motivational tool. 

If an employee has delivered exceptional results, consider having their manager or even the CEO praise their efforts at a team gathering.

It’s important to remember that everyone is different. Some individuals may not welcome this attention. In this case, an email of thanks could be more appropriate.


Disciplining an employee is often one of the least pleasant aspects of people management.

The goal of discipline should not be to embarrass or upset an employee. Instead, it should focus on helping them to improve in their role.

In most cases, employee discipline involves a series of increasingly serious steps to monitor an employee. The first stage will usually be a verbal warning, which may progress to written warnings, suspension, and even dismissal.

How to Improve Employee Management

No matter how effective your employee management is, there are likely to be areas in which it could improve. 

Treat all employees equally

If you want to create a positive culture, you must behave fairly towards all members of staff. The perception that you are showing favoritism when rewarding or disciplining employees could create tension in the workplace.

Be consistent

Set clear expectations for your employees and apply these across all projects. This way, employees can feel certain about what is expected of them.

Make communication a priority

If your employees are not informed about key information relevant to your business, they may feel disengaged from their role. It is therefore essential that you create time to communicate all important information to staff.

Depending on the nature of the information, you can do this to your employees as a group or during one-to-one meetings.

Avoid micromanagement

There is a crucial difference between management and micromanagement.

Good managers inspire their employees. Micromanagers, however, insist on controlling most aspects of their employees’ working lives. Such an environment will damage employee satisfaction levels and the rapport between you and your employees.

Micromanagement can also undermine your employees’ confidence, making them feel they lack the power to make a decision.

Understand the law

If you’re responsible for people management, it is crucial that you fully understand all relevant employment legislation. If you’re uncertain about a particular course of action, consult your company’s legal department.


Employment management is a huge, but critically important job. If done correctly, it can help improve employee productivity and engagement and protect you from legal action. Following the tips in this article could certainly help you better organize your employee management. 

However, effective management relies on striking a balance. It is also important to recognize your employees as individuals. Once you get this balance right, you are likely to see an increase in engagement, productivity, staff retention, and profits.