What Is Employee Monitoring? A Comprehensive Guide

Whether you work remotely, in a hybrid environment, or in an office environment, employee monitoring is an effective way to increase productivity by better understanding not only when your employees are working, but how they are working.

Traditional employee monitoring involves control and surveillance, an easily understood concern for employees and businesses alike.

Forward-thinking companies understand that employee monitoring is just one method of collecting highly influential performance indicators that contribute to employee productivity, efficiency and engagement. When used correctly and transparently, employee monitoring can provide insight into people, processes, and technology.

In this article, we discuss the basics of employee monitoring and provide practical tips on how to implement it and use the data collected to create a more transparent workplace.

What Is Employee Monitoring?

Employee monitoring is a method of activity control used by businesses for a variety of reasons, such as preventing and detecting costly privacy breaches, improving employee engagement, and streamlining inefficient business processes. More recently, modern employee performance monitoring tools have further demonstrated the potential of comprehensive HR analytics and employee performance coaching capabilities. These modern tools enable companies to optimize employee performance, increase engagement and reduce inefficient processes. By tracking and analyzing employee performance, companies can increase productivity and become more profitable.

The employee tracking and behavioral data collected can be analyzed to identify trends, patterns, and correlations between teams, groups, and departments providing insight into business processes and how to improve them. This includes activity data such as application usage, time spent on non-productive tasks, and times of day when each employee is most productive. Employee monitoring provides employers and employees with the information they need to improve individual, team, and company productivity.

This guide will help you decide if employee monitoring is right for your team, which system to choose, and how to implement it in your office.

Types of Employee Monitoring

Historical methods of employee monitoring

The evolution of technology has greatly expanded the possibilities for monitoring employee performance. Until about a decade ago, employee monitoring was typically done locally in the office. Times have changed. This change in work practices is now forcing companies to rethink how and why they implement and use employee monitoring. This section briefly reviews historical types of employee monitoring before moving on to more modern approaches.

Internet and email

These are the two main elements of employee work or employee monitoring.

We know that the Internet is essential to productivity, provided it is used properly and effectively. We want to know how the Internet is used and if there are opportunities to improve its use within the team.

Although other means of communication have reduced the use of e-mail, understanding communication and the use of e-mail can help improve productivity and work efficiency.

Computer Activities

As with Internet monitoring, some of these programs allow employers to track the use of applications on the desktop. The data collected can be presented in very detailed reports on time spent on productive tasks, time the computer was received, and the most used applications.

Keystroke logging

Keystroke loggers are processes that successively record the keys entered by the user on the keyboard. These programs can also take screenshots triggered by predefined keywords.

However, recording keystrokes has major drawbacks. Some see it as an invasion of privacy in the workplace.

Often, they are also used maliciously. Modern employee monitoring tools do not offer keylogging capabilities due to employee privacy concerns. Modern approaches to employee monitoring rely on open communication and transparent productivity strategies, so keyloggers have no real use.

Phone Numbers

When you call customer service with a problem with your router, you sometimes get a message like this?” This conversation can be recorded for quality improvement and training purposes. Congratulations! You have actively participated in monitoring your employees’ calls. This way, the company can manage quality assurance and ensure that employees are providing excellent service to customers.

GPS tracking

GPS tracking is used to monitor company vehicles while they are in use. This is useful for delivery, courier, and messenger companies to track vehicles and ensure that drivers are taking the most efficient routes. It can also be used to check on the status of deliveries, search for lost items, and ensure general safety.

Benefits of Employee Monitoring

Celebrating business achieving target performance. Rewarding for reaching successful accomplishments

We know that employee monitoring systems, when used properly, can be effective because they

  • Allows for analysis of business processes
  • Creates a more engaged team
  • Reduces employee retention costs
  • Provides data transparency
  • Protects against data loss

Effective management

Analyzing the data collected allows you to identify the strengths and weaknesses of your employees, which can help you create a more effective team. It also allows you to identify the strengths and weaknesses of your employees, which allows you to outsource work more efficiently. Aligning the strengths and skills of team members to the right tasks is essential and allows the team to perform at its best!

It is equally important to identify team members’ weaknesses. A behavior-based employee tracking system can help determine where team members need additional training or coaching. One person may take an inordinate amount of time to complete a project. Ask for guidance. Make sure staff members know how to use the tools and ensure that they are trained if they do not. Investing in staff professional development is a way to increase team engagement and well-being.

Discover the unknown benefits of an engaged team

It’s common knowledge that nearly 70% of Americans working in the business are not fully engaged. 40% of Americans are not engaged at all. With employee engagement being such an important issue, companies need tools to accurately determine who is not engaged, what the causes are, how detrimental it is to them, and what can be done about it.

Active turnover is a “silent killer.” Does this sound scary? It should be! Employees who are not actively engaged are not only dissatisfied and unable to do their jobs well, they are “letting their dissatisfaction out” and “undermining what their enthusiastic colleagues are accomplishing.”

Unfortunately, when employees lose interest, they also lose interest in the goals and success of the company. They only go to work to get paid. If 67% of the world’s workers are not engaged, can you imagine how much money is lost each year by employers in the U.S. economy – $350 billion, to put it in perspective?

Behavioral analytics can give you insight into who on your team is not engaged or moving in that direction. For example, data can show how much time employees spend on non-productive applications. If you graph this information in a time series, you can see who has seen their productivity go up, down, or stay steady. With this knowledge, you can interview employees if necessary. You can assess the current situation and determine what support can be offered.

Financial growth

U.S. businesses lose $650 billion annually due to unproductive employees.

Introducing workforce analytics and performance tracking software can help reduce these losses. Successful, data-driven businesses use the analytics provided by tracking software to improve productivity, revenue, sales, employee retention, satisfaction, and efficiency.

The restaurant industry is one example. A Massachusetts Institute of Technology study found that restaurant sales increased by 7 percent when they started tracking their employees. The reason? According to researcher Andrew McAfee, “As far as we can tell, productivity increased simply because people were doing their jobs better.”

In addition, the data collected by employee monitoring software allows for more informed business decisions. You may find that too many people are working on one task. Why not use company time and resources more efficiently by assigning some of them to new projects? Or find out what software (you’re paying for) is being used less often. Get rid of what’s not needed to avoid unnecessary expenses.

Security and protection

Data breaches and cybersecurity are constant concerns for businesses. Hackers are so smart that they find new ways to access data every day.

Large organizations are especially vulnerable to hacker attacks. This is because companies have grown in size and human error, such as accidentally opening a phishing email, is more likely to result in a hack. Nearly half of Americans have had their name, Social Security number, date of birth, home address, and driver’s license number stolen by the credit reporting agency Equifax.

Threats can also come from within: 87% have taken company information and documents after a layoff.

By monitoring employees in a variety of ways, managers have a clear picture of what employees are doing and when they are doing it. Data logs also serve as a black box for the company in case of fraud or legal issues. This makes it easier to know who did what, when, and where.

Disadvantages of worker monitoring and how to solve them

Wow, how great are the benefits! What’s stopping you from starting now? Well, you might be facing a perception problem. The goal of reviewing your employees is to create a company culture where everyone does their best and works as a team, not to spy on them, right? However, your team may perceive you differently at first, and you may encounter various annoyances.


Behavioral monitoring raises questions about data privacy. People who use company computers for private purposes want their activities to remain private. They also feel uncomfortable with the idea that their every move is being monitored. It’s scary!

State that employee privacy is very important. Analyze the data instead of chasing it. We are not interested in personal information such as passwords, driver’s licenses, passports, social security numbers, etc.


One of the problems with surveillance cameras is the “trust” factor. If your actions are perceived as spying, you can get angry, frustrated, and withdraw. This does not accomplish its purpose.

You can gain the support of your employees if you show that you are monitoring them for the right reasons. Don’t monitor just for the sake of monitoring and don’t be invasive without good reason. Transparency is the best practice. To emphasize to your team that the monitoring system should only be used as an analysis tool.

Increased stress levels

When people know their behavior is being monitored, they instinctively work harder, take fewer breaks and worry about their performance. This increases the stress level in the team and can lead to low morale and turnover, which is exactly the opposite of what you want to achieve!

If you explain what type of data is being collected and why you can address these concerns. Put a plan in place to use the data only for analysis.

Avoid using too many tools, like the manager described in the Psychology Today article. This manager kept sending a message to his unproductive data processing employees. So, that message was, “You don’t work as hard as the next person.”

There are many uncertainties about the legality of activity tracking. One reason is that there are different laws about what is and is not allowed. We’ll cover this in more detail in the next section, but first, be aware that the legality of worker monitoring depends entirely on where you are.

That doesn’t mean, however, that such data collection isn’t possible. There are ways to analyze your daily activities in accordance with local law.

Legal Aspects of Employee Monitoring
Male Character Shocked with High Price Concept. Upset Businessman or Boss Sitting at Office Workplace Look on Paper with Unhappy Face Dissatisfied with Service Cost. Cartoon People Vector Illustration
  • What are the rules for workplace surveillance?
  • When is surveillance possible? How does it differ from country to country?
  • What must be done before surveillance can take place?

Now it’s time to address the elephant in the room. There are some misunderstandings about the legality of data collection that may deter you from doing so. Is employee monitoring legal?

In a word, yes! Workplace law states that you can conduct digital surveillance in the workplace. This means, for example, that the contents of your emails can be read on their servers. Currently, there is only one restriction regarding phone calls. The employer is not allowed to monitor the private calls of its employees unless the employees know about it and give their consent. For all other activities, employee consent is not required as long as they are using company-owned devices.

However, some states have gone even further in protecting privacy. In Connecticut and Delaware, employers are required to notify employees before monitoring begins. Before installing this software, always check the laws in your country.

Other laws may apply in your country. In European Union countries, the right to privacy in the workplace applies. Employers need to be clearer when introducing activity tracking: All individuals in the EU must consent to the collection of their personal data and be informed of how and why it is being collected. Find out what laws apply in your country to be sure.

For best results and to build trust, it is always advisable to inform staff that you intend to install software and explain how it will be used. You need to know what kind of data is being collected, when, and why. Ultimately, the more transparent you are, the less likely you are to run into legal problems.

Is this what you need?

Before you choose the best employee monitoring software, you need to be absolutely sure that it is right for you. This type of software can be used for the wrong reasons, which is not entirely true. So, it is very easy to decide if you should take the next step.

Just think about the following.

What are my goals?

Think about the goals of your business. Write them down and leave room for notes. Here are some options.

  • Reduce costs
  • Improve customer service
  • Improve data security
  • Retain employees
  • Relocate offices
  • Become more efficient
  • Provide better legal protection
  • Make better use of micromanagement

Can employee tracking software help you achieve these goals?

Look at what you’ve noted and write down how activity tracking can help you.

  • Reduce costs – find out what software is not being used and remove it.
  • Improve customer service – look at your employees’ workflows and analyze their efficiency. Accelerate response times.
  • Improve data security – use alerts to be notified of data breach threats. Reduce sensitive information with DLP.
  • Employee retention – use productivity reports to see which employees are gradually losing interest and why. This shows that you want to retain your employees and asks how you can make them feel more valued.
  • Office relocation – this can be a more indirect result. Perhaps by cutting costs, they can move to another office and see if it will impact their team’s productivity.
  • Become more efficient – review business processes. Remove employees from unnecessary projects and assign them to new projects.
  • Better legal protection – a virtual black box for all IT transactions, leaving a trail of data that can be presented during investigations and legal proceedings.
  • Better micromanagement – hmmm, is that your goal? Technically, you can achieve this goal with employee monitoring software, but is it the right goal?

Do you need to use behavioral analysis software?

Keep it simple here. What is the value of improving customer service? What about secure data? Increased efficiency? Increased legal protection?

Compare the value of achieving goals with the value of a potential software product. For most software, it is simply useful to monitor workplace behavior. Ultimately, however, you must weigh the pros and cons.

Are companies like mine achieving their goals with employee monitoring software?

achieving goals with employee monitoring

Employee monitoring is about data, not control.

At the time of this writing, tools to collect this data are a $200 million booming industry. Over the next few years, more and more companies will invest in software and other solutions for monitoring employee behavior.

Insurance companies, universities, design firms, schools, and large multinationals are just a few examples of teams that have embraced behavioral analytics. Even restaurants are using software to monitor servers and track their every move. Further, companies of all kinds are successfully improving their business processes based on metrics collected with employee tracking software.

How to choose an employee tracking software?

Excellent So you’ve weighed the pros and cons and decided that you can achieve your goals with business tracking software. Let’s be honest, there are many different types of employee tracking software. It’s a tough decision to make. Let’s simplify things a bit.

Make a checklist for employee monitoring

Before you spend a lot of time shopping around, start by creating a checklist of features you need for your business.

You may or may not need the following features

  • Website blocking
  • Real-time monitoring
  • Full access to SQL data
  • Screenshot capture and export
  • USB alerts
  • Prevention of information loss
  • Keystroke recording
  • Time spent on activities
  • Ability to categorize activities as productive or unproductive.

The mechanisms of the system are also an important factor. Many of these can be classified into two categories: User inputs and continuous on/off plans. Some personnel tracking programs offer workers the ability to track each task themselves. Applications are used to record project starts, stops, and breaks. Data is collected only during this time.

Others collect data during the entire time the computer is in use, allowing workers to work freely without seeing the logs. In most cases, the manager can reserve this record. This is useful if you want to monitor only during working hours. The advantage of this type of monitoring is that it provides objective data. Without user intervention, there are only facts that cannot be manipulated.

Once you have determined which features are most important to you. Then you can begin to compare services that offer those features and best meet your needs.

The next step is to actually reduce fat. These three questions will help you choose the right behavioral analysis system for small, medium, and large businesses.

How long does it take to get the benefits?

It’s time to see the data.

Think about how long it takes from installation to reliable data analysis. How long does it take to install on the network? Do you see the results in the analytics dashboard immediately after installation or is there a delay?


Customization is great, but setting up all the accounts and users can be a daunting and tedious task if you don’t have enough default settings! Plan accordingly.

Do you need experts?

You may need experts who are not part of your own team to work on the software. You may need someone to maintain the software or a data analyst to interpret the results. Find the right expert. Otherwise, take the time to train team members in the appropriate skills.

Learning curve

As with many new tools, most users will first go through a learning curve. Some training may be required for all available features. In fact, it takes some time to realize the full potential of the software.

What are its limitations?


Scalability is the capacity of software to evolve with the company. It must be able to handle large volumes, peaks in activity, and a growing number of sites and users. It must also be able to process and store large amounts of data quickly and reliably, regardless of the size of your team. If you’re an e-commerce company that needs to measure its performance during Cyber Monday, you don’t want your employee monitoring software to fail!

Data size, speed, and storage

Find out how the software handles data, what servers it uses, where the data is stored, how much storage space it can use, and what limits there are on the amount of data it can handle. If you have no idea how complex data processing is, talk to your company representative. Explain your needs. Also, see if the system can meet them!


Sure, you may have all the features in the checklist, but can you change, modify, delete or add them? Some companies prefer to label social networks as unproductive. However, if your business relies heavily on Facebook, Twitter, and Instagram for marketing, you may need to classify these sites as productive and factor that data into your performance analysis. Every business is different; one size does not fit all. Moreover, customization is the key to getting the most out of your software.

Align well with others

Employee monitoring software has been known to have problems with some antivirus software. Prevent headaches. Also, ask the salesperson if there are any known problems with the antivirus software.

The right combination of software can dramatically increase the effectiveness of an employee monitoring system Software integration can automate many applications or interact with other applications. Further, find out if the system you are considering has such features and makes your life easier.

Set yourself up for success

Have you chosen the best employee monitoring software for your team? Congratulations, you have found the right employee monitor system for your team. You have real potential to achieve your goals and grow your business. You’re just not ready to get to work yet. There are still a few things you can do, all of which should be part of your action plan.

Get your team involved

In the U.S. (with the exception of a few states), it’s certainly legal to collect workplace data without employees’ knowledge, but that doesn’t mean you have to do it if you can. In fact, it’s a good idea to hold a meeting to inform your employees that you’re going to implement surveillance software. Here are some things to consider

  • What is it?
  • How does it work?
  • Address data protection issues (emphasize that it is not a spy camera).
  • Why is it necessary?
  • Benefits for companies
  • Benefits for individuals

We haven’t gone into detail about the direct benefits to workers, but there is a whole host of them! You probably already have some ideas in mind. But feel free to steal a few and use them in your meetings.

  • They all use the same data and are evaluated the same way. Data doesn’t lie, so performance is supported by facts, not favoritism.
  • Analyzing the data allows you to distribute the workload more evenly and find an optimal way to work.
  • Your hard work will not be overlooked. There are many opportunities where you can be recognized for your hard work.
  • The report is a coaching and learning tool. It will help you identify the areas you need for professional development.
  • Work becomes play. Improving your performance week after week is also a friendly competition with your past!

Take the time to ask your questions once you have considered these points. Ask everyone’s opinion. First of all, some people will worry about their privacy and whether they are being watched. This is a natural feeling. If you are able to explain the purpose and benefits of analyzing team behavior, you should have no trouble reassuring everyone.

If you feel uncomfortable, try to justify your intentions using the following instructions.

Things to consider when using

Be a reasonable administrator

The choice of sites to block and moderate should be carefully considered – YouTube may be the first site to be blocked, but think carefully – YouTube has a series of useful tutorials that will improve your team’s skills. Also, monitoring tools should never be used to punish staff.

Be flexible with expectations

Don’t expect every employee to work eight hours straight. Do you have the stamina for that? People need breaks! The key to ethical employee monitoring is to remember that people are human beings. Even if you get distracted and take breaks, don’t punish someone just for your health. Understand that employees need breaks and insist that it is perfectly acceptable to take reasonable breaks if necessary. Set limits, but allow flexibility for personal use. Also, a good work-life balance is key to keeping your team happy.

Don’t be afraid

As we’ve pointed out several times in this guide, activity tracking is not a spying tool, so leave it alone. Don’t track everything people do. If you can name Stephanie’s Facebook friends just because you studied her screenshots, you’ve gone too far! Again, you need to be aware that the sole purpose of this tool is to check on and improve your company’s performance.


Some programs can be customized, allowing you to use the tool in a flexible way according to your needs. Sometimes an application or task that a company considers unproductive may be deemed necessary to run your business. Determine how the software should react when you use these applications. If it’s a function, create a monitoring schedule that includes lunch breaks and doesn’t cover work done after hours. Further, think about what you can do to make the software work optimally for your team.

Formalize the policy

If you’re involving your team in the implementation, it’s a good idea to develop a policy that documents everything, so everyone feels comfortable. What you said in your introduction can be easily summarized! Talk about the software you use, what it does, and why you use it. Also, why it is important to your professional development and business growth.

Here are some tips.

  • State everything in plain English. You don’t want to sound like a legal expert.
    • Don’t use wording that would make you sound like a shadowy authority.
    • Make it understandable. Avoid misleading others, whether intentional or not.
    • Make it clear what employees should do if they have questions or concerns.
    • Insert a signature line to confirm that the employee has understood and agreed to the terms.
    • This should be done before they use the software.


Introducing monitoring software to employees can be stressful at first. Try to see the situation from their perspective and listen to their concerns. Don’t dismiss others’ ideas as paranoia. Maybe they don’t have any concerns! Maybe some of your team members are excited about the software. Moreover, someone has ideas about how to use it that you could never have imagined.