Employee-tracking tech is getting out of hand: How managers can do better

Leading-edge technologies, such as artificial intelligence, machine learning, and robotics, have made it easier than ever for management to surveil staff members, whether they are aware of it or not.

That scenario presents a problem for everyone, including the C-Suite, as the overuse of employee-monitoring tools can lead to serious outcomes for workers, most notably mistrust, privacy concerns, low morale, and an exodus of staff who have had enough.

The data backs that sentiment up.

• 78% of American companies deploy algorithmic employee monitoring tools.
• 42% of US workers say they’re being monitored on the job.
• 61% of "heavily monitored" staffers actively oppose being tracked at work.
• 35-to-40% of remote workers are more productive when they’re not being tracked.

Workplace experts say it matters how employees are being monitored. For example, anxiety rises when staffers are passively tracked, usually with AI-powered digital tools operating quietly when tracking office hours, mobile app activity, or website visits.

The pressure eases when team members are monitored actively, with employees fully aware when logging in and out of work. That’s why finding middle ground with staffers is key.

Here’s how employee tracking applications work

Worker tracking software works like a vacuum cleaner, sucking up data that can be studied and used in myriad ways.

“Companies deploy employee monitoring software that functions by tracking activities on company devices, collecting data on everything from keystrokes and application usage to network activity and website browsing,” said Peter Miscovich, global future of work leader at JLL, an international commercial real estate services and technology company. “The employee tracking data is compiled into reports and dashboards, providing managers with insights into productivity and security, and can be leveraged to improve human performance when properly managed.”

With advanced AI tracking software in play, an employee’s activity can be tracked from the moment they log onto their company computer or laptop at the start of the workday. “The employee tracking software categorizes employee time spent during the workday, identifying work-related versus non-work-related computer applications as the software can track all human-to-computer work-related activity levels,” Miscovich noted.

Yet employee tracking systems aren’t all about limiting team members’ liberties at work.

“Often, employee tracking software provides managers with performance insights through AI analysis of the employee's daily work patterns, which can help detect burnout risk as well as provide monitoring for potential security threats,” Miscovich added.

After review, aggregated employee tracking data can then inform human resource “people” management and influence employee performance reviews. “At that point, it can provide long-term work-related operational efficiency and effectiveness recommendations,” Miscovich said.

Big risks can arise with employee tracking at work

Lack of trust with tracking software is a broad issue and highly dependent on who’s assessing it.

“Someone simply might see an employee quickly checking out a social media post on TikTok,” said Jan Hendrik von Ahlen, managing director at JobLeads, a global career services platform. “Others simply don't believe that people can perform well with freedom and flexibility,” which is a sign of a dysfunctional company culture.

One major advantage of hardcore employee tracking is gaining, or attempting to gain, control over what everyone is doing at any given time in the company, but that benefit comes at a significant cost. 

“The disadvantages include complete loss of trust, privacy concerns, lower productivity and morale, and potentially lower staff retention,” Hendrik von Ahlen noted. “It's also sure to affect work-life balance when working remotely and contribute to a fear-based company culture.”

Consequently, with two employee tracking buckets involved, it’s up to management to ensure they prioritize tools that give company leaders a high-level, anonymized view of what’s happening across teams. Too often, that’s not the case, workplace gurus say.

“The right way to think about employee tracking is how to use aggregated, privacy-first data to spot issues early and support people before problems get bigger,” said David Shim, CEO of Read AI, a productivity and meeting analytics platform. “If you’re not building trust, you’re missing the point. You won’t see either adoption or impact, and then fall behind.”

For employers, the biggest issue with worker monitoring is clarity. 

“When everyone understands where time is going, teams can prioritize better, spot inefficiencies, and have more fact-based conversations about workload and outcomes,” said Jared Brown, CEO at Hubstaff, a remote workforce management solutions firm that helps over 95,000 businesses work with remote teams.  “This gives context to everything.”

The downside comes when these tools are implemented without transparency or input from the team. “If people don’t understand what’s being tracked and why, it erodes trust,” Brown noted. “Transparency isn’t optional, it’s foundational.”

Companies need to apply these ‘best uses’ when leveraging employee-tracking tools

That transparency should start before you ever turn the tool on. “Teams, and not just leadership, should know what’s being tracked, how the data is used, and how it benefits them,” Brown noted.

Brown’s advice to any company is simple: use tracking data to empower, not police. “Share reports openly and talk about what the numbers mean,” he said. “Encourage employees to view their own data and use it to manage their time and goals. When everyone has the same visibility, accountability becomes shared, not imposed.”

If company decision makers want to use some form of employee tracking, the best path forward is to be as honest as possible with employees.

“Clarify why you are doing this, both for yourself and for the team, “Hendrik von Ahlen said. “Involve the employees early in the implementation process, gather feedback, and be careful about choosing the right software.”

Also, employers need to differentiate between tools that help people become more productive (e.g., when tracking 'deep work' sessions) and those that make people feel like they are being spied on.

“Set clear policies, focus on data security, and try to find the right balance,” Hendrik von Ahlen added. “Remember that your main focus should always be company outcomes and progress rather than people control.”