
In an era dominated by the cloud, Web 3.0, and AI-powered everything, chances are that a good portion of your company’s workforce is distributed and working remotely. However, this arrangement begs the question, “If a manager doesn’t know everything that employees do on company time, can it be said that they are even working?”
While the answer may seem obvious on the surface, the truth is that giving “too much” freedom to your workers doesn’t have a clear correlation to financial losses that have no receipts. You’ll be surprised to learn that the opposite is actually true—if an organization’s time tracking practices are too invasive, the company is likely hemorrhaging money through lost talent.

The Human Cost
Jack Furgeson thought he’d landed a solid deal when he joined a major e-commerce platform as a senior data analyst. The hiring process was grueling—five interviews and seemingly endless coding tests—but the prospective $110K a year made the process worth it. Or so he thought. Months into the job, Jack’s workdays became an endless cycle of monitored screenshots, taken every 10 seconds, and stored in some dusty server somewhere. Though the vast majority of the content was rarely reviewed, the blinking “idle” indicator of the monitoring software felt like an ever-present reminder that someone was always watching.
The straw that broke the camel’s back came in the form of a weekly review, when Jack was emailed a “productivity report” featuring a screenshot of a YouTube video—an apparent breach of company policy. “I put in my two-weeks’ notice right then and there,” Jack said. “It’s just this constant, unnecessary, nerve-racking stress. While you’re reviewing a document, you don’t know who is reviewing you.” Feeling suffocated, he left the company for its direct competitor, trading a higher paycheck for the freedom to work without constant surveillance and micromanagement.

The Bottom Line
The numbers paint a vivid picture. Even at Amazon, a company notorious for its employee monitoring practices, the pre-pandemic turnover rate was as high as 150 percent. Though this rate is nearly double the retail and logistics industry average, the number still had executives worried about their bottom line. The average cost per hire in America is $4,700, according to SHRM benchmarking data, but when factoring in recruitment costs and lost productivity, the cost of replacing an individual employee can balloon to one-half to two times the employee’s annual salary.

Source: Employee Retention Statistics: Why Companies Need to Pay Attention in 2024
Whether a company’s approach to monitoring employees feels invasive comes down to employee trust and policy transparency. “The true currency an attorney has is trust … and the technology they’re using to monitor what attorneys are doing puts that trust into question,” said Gerald Edwards, a New York City attorney practicing since 1994. “Are you even trusting me at all, that you have to watch me and monitor me like a 4-year-old?” The blogosphere is inundated with complaints and studies that show a tanking level of trust as time tracking crosses the line into outright employee surveillance. Is the feeling of being treated like a child worth the security that invasive employee monitoring supposedly brings?

The Bright Side
In truth, not all time tracking software is the same. While it is incredibly unlikely that companies worldwide will suddenly decide to hand their employees the proverbial keys to the city, it is nonetheless important to strike a balance between activity insights and gathering data that borders on privacy violation. Autonomy in the workplace doesn’t just result in warm, fuzzy feelings in employees—it drives performance. Case in point, a study published in Frontiers in Psychology found that an increase in autonomy correlates to an increase in productivity.
A shift in strategy that moves towards employee autonomy doesn’t have to be a painful one. It can be as easy as switching to an ethical time tracking software solution, like Traqq, that focuses on productivity monitoring without sacrificing privacy. Eliminating invasive features like keystroke logging, screenshots, and webcam access can have an immediate positive impact on the employee-manager relationship.

But getting rid of invasive features doesn’t mean that you should be left totally in the dark. Any manager worth their salt needs to have a deep understanding of the team’s workload trends, activity patterns and company growth metrics—knowledge that Traqq provides with the help of its AI-powered insights.

At the same time, companies need to be transparent and upfront about their monitoring policies. Everything that will be tracked needs to be outlined either during the hiring process or when the software is implemented. “When an employer explains the reasons for the monitoring, more than 50% of workers report being comfortable with it,” a Gartner study reveals. Thankfully, with Traqq, employees have access to all of their own data and can explore the AI-powered insights it provides at any time. Essentially, the employee sees everything that the manager does, so there’s no guesswork about what is being reviewed.
The Right Choice
Productivity monitoring and employee privacy shouldn’t be a tug-of-war struggle. The choice isn’t a stark battle of good versus evil, but rather, it’s a balancing act—a gray area where trust and transparency coexist with performance metrics and business goals. Invasive monitoring might provide the illusion of control, but the long-term costs, from eroding employee trust to skyrocketing turnover rates, reveal a harsh reality: micromanagement isn’t a sustainable strategy.

So what’s the future of productivity management? Ethical time tracking solutions like Traqq show that it’s possible to gain meaningful productivity insights while respecting employee autonomy and privacy. The benefits are clear—higher retention, more engaged employees, and ultimately, a stronger bottom line. For decision-makers, this is an opportunity to rethink your approach to time tracking. Recognize the human side of your workforce and invest in tools that build trust while providing you with the data you need to make well-informed managerial decisions.