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Problem Employees... Grow or Let Go?

The most challenging problem a small employers faces is whether to fire a problem employee; or help that employee mature. It’s an understandable dilemma. On one hand, you can envision your problem employee making up ground, improving, and becoming a star performer. On the other hand, you see this problem employee as a cancer leading your company to ruin.

In most cases, the small business owner avoids dealing with problem employee situations altogether hoping they will work themselves out. After all, your problem employee is probably just going through some “phase”. Right?

Is it You?

The first question you must ask yourself is, “Am I setting this employee up for success?” It is normal for stressed companies to put their people under undue stress. This can happen when a company is growing quickly; is resisting growth; or is under economic stress.

Quick growth: When companies grow quickly, they do not hire the added resources quickly enough; and existing employees are put under stress. As small companies grow, it’s important to map out the organization chart you need for each stage of growth. Your problem employee may be stuck with too much work for their role; or they may be tasked with too many divergent responsibilities to do any one of them well.

Resisting growth: Small business owners experience stress during growth. This happens because they do most of the work associated with growing. This means that subconsciously or consciously, they don’t want to grow. Why? Because growth = pain. This resistance to grow often shows up with reluctance to hire new employees; or promote existing employees. This dead-end environment attracts employees who don’t want to grow and see no benefit in striving for anything more than what they have now.

Economics stress: When you stress about money, this stress makes its way to some of your employees. Let’s say that you are going through a difficult time, financially. You underpay your people and hope that they don’t notice. They do notice, and they are giving you a lesser work product than you think you deserve. If this is your situation, it’s best to be honest with your people, and have them help you extricate yourself from your financial situation.

There are certainly other categories here; but I think you get the point. See if you are creating a problem for some or all your employees by the way you are leading your business.


I must include this topic. To be honest, training is rarely the problem with a problem employee. However, if you think that your employee needs better orientation with their job; and skills training, please create a plan to invest in your employees to train them to where you’d like them to be. Keep in mind, skills can be trained, but character flaws can rarely be untrained.

Results vs Personality

We are all different. Some people love to talk; while others prefer to keep to themselves. Some are logical analytical thinkers while others are empathetic and social. If you are a logical thinker, you may think less of someone who relies on their feelings to make decisions. You may think that punctuality is a necessary professional trait, while others see it as an unnecessary rule. Regardless, you need to view the results of your employees… not their methods or the way they get results. Obviously, you don’t want a salesperson who lies to get sales. However, if someone is late to work, but completes their work in a timely fashion, you may want to drop your desire to have them come to work on time.

The best way to separate fact from unfair judgement is to create a business plan that quantifies the results you hope to achieve with each of your people. If your salesperson is on target to meet their sales goal, but dresses like a slob and comes to work late, you may reconsider rules that you’ve created that are unrelated to your employee’s success.

If a salesperson is supposed to sell $1.0 Million each year; and is selling $250,000, then they are falling short of their role in your company. This must be addressed. Now, if that salesperson dresses like a slob and comes late to work, that may be the cause of missing their sales goal. Even then, resist addressing their dress and their punctuality. Ask them to identify the reason they are missing their goal. You can help them connect their behavior to their results. However, that sounds like micromanaging and is rarely successful at creating long-term behavior change.

The Back Story

In the show “Undercover Boss”, the boss goes undercover as a low-level employee to get a better sense of how his/her company is operating. Inevitably, they’d learn that their employees were struggling with personal burdens that brought them to tears. In the show, the boss would offer some sort of financial bonus to these struggling employees to help them out.

In almost every case when I coach an employee who is having difficulty with their work, there is a back story that they don’t want their boss to know about. They are struggling with a personal relationship; or they have mounting debt; or they have a substance abuse problem.

It is normal for a boss to believe that personal problems should not be brought into the workplace. It is also normal for employees to be reluctant to talk to their boss about their personal problems. While this is normal, it is not helpful. You can’t and shouldn’t always fix your employees problems. However, if you are aware of issues in their life, you can at least be understanding. You may even be able to help.

A great resource to help in dealing with your employee’s back stories is to hire a group called Workplace Chaplains. This is an employee benefit that can be offered to any employee who needs someone to talk to about personal problems. All of your people may ignore this service altogether; however, it is a great outlet for your people to gain help that will benefit your company and your employees.

Poor Fit

The most common problem with problem employees is being a “poor fit”. Like it or not, we all need jobs to make money to pay bills, pay for vacations, and hopefully save for retirement. This need surpasses our ability to find a job that's a perfect fit. This means that we will tolerate a job that is not rewarding and not a fit for our skills so that we can pay our bills.

These problem employees get a job with you because they were good enough to fake it through a resume, and interview. Now, you and they are experiencing the friction of a “poor fit”.

My business owner clients ask, “They don’t seem to want to be here at all. Why doesn’t this person just quit? Why do I have to put them on a performance improvement plan?”

The best way to handle a “poor fit” is to help your problem employee seek out the “right fit”. Most employees do not want to leave their job for financial reasons. If you find another position in your company where their skills are better suited; or find them a job in another company where their skills are a better fit, they will jump at the opportunity to end their, and your, misery.


In this blog post, I’ve tried to illustrate some ideas on how you can honestly evaluate the situation with your problem employee. After you feel like you’ve covered all of these bases, it’s time to act. This action may be a performance improvement plan, it may be more training, it may be counseling from a coach or workplace chaplain, it may be a compensation adjustment, it may be assignment to a new role in your company, or it may be letting your employee go.

In almost every case I remember with my problem employee or the problem employee of one of my clients, letting that person go was the best decision. I have heard my business owner clients talk about how much better their company runs after that problem employee was gone. I also hear from problem employees how glad they are that they could pursue a career that they loved after leaving that problem employer. Yes… firing an employee can be a win/win decision.

Regardless of what action you decide to take, don't delay.


About me. I have been actively engaged in the energy efficiency, renewable energy, and energy conservation industry all my professional career from 1987 until now. I was a licensed Professional Engineering in six states and a Certified Energy Manager (CEM). I worked as a sales executive, energy engineer, sales manager, and entrepreneur. I started, grew, and sold my own Energy Service Company (ESCo) called Ennovate Corporation (1997 to 2013). I am now a certified professional business coach for business owners, engineers, and business development executives.



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