Running a business? Effective ways to discipline employees while maintaining loyalty

Written By Steps To Faculty Published July 8th, 2010

What is the most effective way of disciplining employees?

Every business owner is going to have employees who think that the rules do not apply to them; it is unavoidable. With that in mind, you need to have a game plan in place for disciplining such people so that others are not tempted to do the same – and so that employee morale does not drop. No matter how you look at it, the key is to make the process transparent, predictable – and equally applicable to everyone, too.

Step 1 Make sure that everyone knows the ground rules from the start

Business owners would rather not have to tell employees not to do this and not do that because, frankly, it can be boring, redundant and sometimes unpleasant. However, a smart business owner will have a contract placed in front of all employees that outlines what can, and cannot, be done at the business; make things as explicit and as clear as possible and post rules of behavior wherever you can on the premises. At the same time, make the punishments as clear as possible. Suffice it to say, when people decide to break the rules, they have to be denied the crutch that they did not know they were breaking the rules. Taking away excuses inevitably means eliminating their credibility whilst elevating yours.

Step 2 Carry out punishments swiftly

When someone breaks the rules, they are breaking the rules; it is that simple and no debate should be involved unless there is the absence of direct evidence that they were the ones responsible for a particular misdeed. When trouble arises, you have to punish the perpetrators right away because a) it gets rid of the miscreants quickly; and b) it lets the other employees know that the company is serious about the rules it has in place. If people can test you, they will; if the company acts swiftly, though, they may have no choice but to decide that behaving is the way to go – or that working somewhere else is the preferred course.

Step 3 Never play favorites

When someone breaks the rules, it does not matter if that person has been a loyal employee for 30 years or a member of the family; the rules are the rules are the rules and everyone must pay the same price for breaking them. If you decide that some people deserve ‘slack’ for misdeeds, you are sure to create envy while depressing morale – and that just compounds the losses associated with the original misbehavior.

Hey, disciplining people is no fun – but you have to do it from time to time so it is best that the punishment be done swiftly, firmly, and without exception. The best way to do all of this is to draw up a company guide-book and contract that is easily accessible to everyone; have everyone read it, understand it, and even memorize the most salient parts of it. Then, when people inevitably do something stupid, punish them without reservation. Make the system swift, fair and tough and you will make your company a well-functioning machine.


Roger Due

Investing in Your Destiny® & Coaching Program - Wealth Building Summit Dallas, Texas

My name is Roger Due and I am from Albuquerque, New Mexico and I am the owner of the Monsano software company. This has been an absolutely fantastic conference. This is the best I have ever been to.