Guide to Choosing Employee Monitoring Software

Almost everyone has worked alongside someone who didn't take their responsibilities seriously. More recently, as online work has grown, so, too, have the number of remote workers, further increasing the need for companies to monitor how employees are spending their time on company devices. That's where employee monitoring software can be beneficial to companies.

If you're considering using employee monitoring software, before you begin shopping for a solution, it's important to understand the types of monitoring software that exist and their features. You also want to familiarize yourself with workplace privacy laws and the extent to which monitoring software can be used to track your workers. This buyer's guide will steer you toward some of the best employee monitoring software solutions and address the issues and concerns of monitoring your workforce.

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What Is Employee Monitoring Software?

Employee monitoring software provides administrators with a set of tools and features that track and record employee behavior when they are on the clock. This includes the websites employees access, the messages they send, the programs they use and the files they open. The purpose of employee monitoring is twofold: to ensure company policies and rules are not violated and to guarantee employee productivity and accountability.

Key takeaway: Employee monitoring software provides employers with greater detail about how employees are spending their time, including what programs they are using and how much of their time they are spending on work-related projects and tasks.

What are the benefits of employee monitoring software

Using employee monitoring software, companies can:

Track time. Employee monitoring software can identify gaps in time usage that help you pinpoint which employees are engaged and productive, and which ones are hurting your team's productivity and efficiency – and your company's bottom line.

Identify problematic usage. If you have a company policy that prohibits social media use during work hours, employee monitoring software notifies you whether your team is violating this policy. While you may not want to micromanage employees who occasionally break this rule, you may need to discipline employees whose worktime social media use interferes with productivity. Additionally, many employees work with sensitive company data. Because employee monitoring software tracks all employee behavior, you'll quickly know if employees are saving confidential company information to personal devices or abusing their position in other ways.

Know when violations occur. Whenever a violation of your company policies occurs, administrators are automatically alerted and provided with supporting documentation. With this information, you can act on it, store it for later use if your employee continues violating your policies, or disregard it.

Control devices. Some employee monitoring software applications allow admins to take control of an employee's device if needed. You may find this feature useful if, after repeated conversations with the employee, you find that they continue to violate company policies. However, this situation may merit firing rather than discipline.

Key takeaway: With employee monitoring software, businesses can track how much time employees spend on work, identify problematic usage, and, if need be, limit the access and control an employee has to company devices.

Types of employee monitoring

Employee monitoring largely involves a software application that is installed on select company computers. However, five other types of employee monitoring in your workplace can include:

Keycards: With GPS-enabled keycards, you can track your employees' locations throughout your facility to understand how they use their time.

Video: Just as some people install video cameras outside their homes to monitor their property, you may want to install video surveillance in your workplace to see your team's activities.

Email: Email monitoring applications can protect your business from phishing attempts by monitoring employees' email inboxes and weeding out malicious emails.

Phone: Similar to email monitoring solutions, you may want to monitor your work phones to ensure they are only used for work matters or to prevent unnecessary calls from reaching your employees.

Keylogging. As mentioned earlier, keylogging is a prominent type of employee monitoring, though it can be controversial. Keylogging involves recording each word an employee types on a company computer keyboard or device (in all programs) so companies can ascertain whether employees are being ethical while they are being paid.

Key takeaway: There are many types of employee monitoring, including via keycards, video, email, phone and keylogging.

How much does employee monitoring software cost?

Employee monitoring software is typically based on a per-user, per-month pricing model, although sometimes these prices are expressed in terms of annual subscriptions. [Read our review of SentryPC, our top pick for the most affordable employee monitoring software.]

Many require a minimum number of users – or employees being monitored – which is typically five but can also be significantly higher depending on the company. However, it is rare to find a subscription plan for a single license.

Employee monitoring software is generally either deployed as an on-premises solution or run as cloud-based software. On-premises solutions typically cost more upfront and require an IT team to maintain a server, but they grant companies more control over the data collected. A cloud-based solution costs less initially and removes the maintenance burden associated with on-premises solutions. However, with cloud-based software, you entrust the management and security of your data to a third party.

The cost of employee monitoring software can vary significantly depending on the included features and the number of licenses you need. In our review, we found that programs cost as little as $20 per user per year to as much as $150 per user per year, though most fell between $40 and $60 per user annually.

You might also be charged setup fees by some companies, which can run as high as several hundred dollars. Ask for a pricing breakdown that includes all fees and any contractual requirements, such as cancellation fees or software update subscription fees.

Finally, some employee monitoring software packages include additional tools, such as mobile licenses or geolocation tracking, for an extra cost. Add-ons are useful, though they increase the total cost, so consider how they will impact your employee monitoring budget before buying.

Key takeaway: Employee monitoring is offered as a cloud-hosted or on-premises solution. Costs typically average between $40 and $60 per user per year.

How to choose employee monitoring software

When choosing employee monitoring software, thoroughly investigate which features are available with the application. Also, ask for a demo or trial of the software to evaluate how steep the learning curve is.

You'll want to strike a balance between comprehensiveness and effectiveness as well as affordability if you're on a tight budget.

Employee Monitoring Software Features

Some of the features you may want the software to include are:

Webpage monitoring: Webpage monitoring logs the websites an employee visits. It usually includes the date and time the webpage was accessed. You can often set up banned or potentially problematic websites and website categories. The best employee monitoring software flags these instances and alerts the administrator when these sites are accessed. [Get comprehensive insights on website and app monitoring with ActivTrak.]

Application monitoring: Application monitoring works much the same way as webpage monitoring, except with software. If a user is gaming on company time, for example, or running programs that are not related to work, an admin sees the dates and times the programs were accessed and for how long. Some software also provides screenshots or recordings of such activity.

Live chat monitoring: This type of monitoring generally tracks live chat conversations across several platforms, including messengers and social media. Dated and time-stamped conversations show where the chat took place, who was involved and the content of the chat.

Email monitoring: Email monitoring works similarly to live chat monitoring, except across major email platforms. Any attachments are typically recreated and can be viewed by administrators.

Removable device monitoring: Removable devices, such as flash drives, can be a serious concern when it comes to protecting sensitive company data. With many employee monitoring solutions, admins can see if removable devices were attached to company assets and what files were downloaded and/or uploaded.

Keystroke logging: Keystroke logging tracks every key a user hits during a session across every program. Dated and time-stamped logs appear, along with a reference as to what application was used and the file or browser the keystrokes occurred within.

Screenshots: Many employee monitoring software solutions include periodic screenshots so admins can see employee activity at a given time. Some even record video snippets so administrators can review exactly what a user was doing at any point.

Webcam access: Some employee monitoring solutions remotely access to a user's webcam. Admins can switch on user webcams to see if the employee is at their computer.

Reporting options: Each software solution reports on employee activity differently. The best software allows you to create custom reports that generate a simple visual based on your preferences. Some reports compare employee activity and inactivity time to productive work and unproductive work.

License tracking. Some employee monitoring platforms allow you to assess the extent to which your licensed software programs are being used. You can use this information to decide whether the money you are spending on certain software licenses is worth the investment.

Hardware blocking. If you have any reason to prevent employees from accessing certain hardware tools, you can implement this barrier through your employee monitoring software.

You'll also want to consider the company's track record for tech support and customer service. A responsive company is an extremely useful asset, especially for a small business without a dedicated IT department. You should be able to easily reach the company when you have questions.

Key takeaway: When searching for employee monitoring software, you want to make sure it includes the tools you need most. This may include webpage and application monitoring, email and live chat monitoring, as well as screenshots and webcam access. Consider, too, how easy it is to reach the company in the event of a question or problem with the software.

Will my employees know they're being watched?

Most employee monitoring software vendors understand that employees behave differently when they know they are being monitored. Employee monitoring software can typically be configured so it is in stealth mode. In stealth mode, users aren't aware that software is actively tracking and storing their behavior.

What if you employ freelancers who use their own devices? Some programs come with a mode that is visible to the user and only active when they clock in to track time for your project. The rest of the time it is turned off, meaning freelance users can use their device without fear of being watched, but you can still monitor their activity when they are on the clock for your company. Employers can also use this visible mode with full-time employees if they want their workers to know that their behavior is being tracked.

Key takeaway: Most employee monitoring solutions offer stealth mode, which covertly runs the software. There is also a mode available for freelance workers that tracks their time when they are on the clock. This mode is visible to freelancers and can be turned off when they are not working on company tasks.

Data privacy obligations

As data privacy laws like the General Data Protection Regulation in the European Union and the California Consumer Privacy Act become more popular, the risks associated with mishandling sensitive user information increase as well.

The same could be true for employee data, the disclosure of which could run afoul of federal privacy laws like HIPAA (The Health Insurance Portability and Accountability Act). Employers must understand and weigh the legal and ethical risks of utilizing employee monitoring software. It's wise to consult with an attorney about the implications of collecting potentially sensitive employee data as part of any employee monitoring policy.

Key takeaway: If you use employee monitoring software, make sure the data you collect isn't in violation of any laws, such as HIPAA. It is recommended that you consult with an attorney to ensure you are properly collecting and handling data.

Additional reporting by Max Freedman.