Why Employee Monitoring Is Doomed To Backfire

As flexible work becomes the new norm, 60% of companies with remote workers are using employee monitoring software (also referred to as “tattleware” or “bossware”) to track their employees' activity, while another 17% are considering it, according to a Digital.com survey. One main reason employers give for implementing this software is to understand better how employees spend their time. It’s a trend that represents what Microsoft Corp. chief executive Satya Nadella has termed “productivity paranoia” on the part of employers.

The problem is that some employees aren’t even aware they are being monitored, and the ones that are don't like it. Based on a survey by the business intelligence company Morning Consult, more than half of tech workers would leave their jobs if their employer insisted on recording them via audio or video or using facial recognition to track productivity. According to Forrester's predictions for the year ahead, trust is expected to be a high priority for businesses as they head into 2023. But the question is, does increasing employee monitoring erode that trust?

While employers claim they want to ensure workers are productive, this approach could have the exact opposite effect. Let’s examine some reasons why employee monitoring is doomed to backfire.

Employee monitoring creates resentment

When employees are monitored, they feel like they are being spied on, which creates stress, anxiety and resentment. These effects are compounded by the burnout epidemic, which has been intensified by the pandemic and is even termed an “international crisis.” Given its negative impact on morale, employee monitoring can make people feel undervalued, creating a toxic corporate culture that decreases retention and impacts recruitment efforts.

Employee monitoring isn’t accurate

Just because someone spends more time in the office doesn't make them more productive. It's the same when measuring productivity using employee monitoring software. Some jobs are more about strategy, leadership, creativity and other soft skills that managers can't quantify by tracking keystrokes. By focusing just on the actions people take, these tools completely ignore the other aspects of work that contribute to productivity. They also don't consider what one Harvard Business Review article calls "fundamentally broken environments—full of fragmented or non-standardized processes and tasks, user-unfriendly IT applications, poor UX design, bottlenecks and other factors that make work harder and slower.”

Employees are more likely to break the rules

While employee monitoring software is designed to reduce rule-breaking, it can have the opposite effect. In fact, one study revealed that “monitored employees were substantially more likely to take unapproved breaks, disregard instructions, damage workplace property, steal office equipment and purposefully work at a slow pace, among other rule-breaking behaviors.” The reason for these actions? The research showed that surveilling workers causes them to subconsciously feel that they are less responsible for their behavior, which makes them more likely to want to break the rules.

Employee monitoring has legal ramifications

The two main restrictions on workplace monitoring in the U.S. are the Electronic Communications Privacy Act of 1986 and common-law protections against invasion of privacy. In the U.S., monitoring employee activities during work hours is completely legal. In addition, most state and federal laws allow organizations to investigate anything that happens on company-owned devices. Despite that, there are potential legal ramifications for employers, including claims of discrimination, invasion of privacy and unfair labor practices. Another possible claim is for unpaid wages and overtime. For example, if a nonexempt employee engages in tasks away from their computer that result in working more than 40 hours a week, they may be entitled to overtime pay.

Employee monitoring can result in bad press

Surveilling employees can also result in a public relations nightmare for companies. Take real estate data firm CoStar, for example. The company was accused in an insider investigation of spying on their remote employees and fostering an unpleasant work culture. It is also alleged that some of the monitoring occurred without the employees' knowledge. Whether the complaints are true or not, the press around the incident has been less than positive.

The number of employers using data surveillance software to monitor employees has doubled since the start of the pandemic. Yes, it’s legal, but is it ethical? The message companies send to their employees is clear: we don’t trust you. A better approach would be to shift that investment toward areas that we know improve productivity levels, like employee engagement, communication and recognition programs. Only then can you create a company culture that people won’t want to leave.

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