Practical Tips for Managing Difficult Employees Fairly

What “difficult” behaviour can look like in a small business

In a small team, difficult behaviour can show up in many ways. An employee may be regularly late, ignore instructions, speak to colleagues in a rude way, miss deadlines, or create tension in a team that previously worked well together.

Sometimes the issue is obvious. Other times it is more subtle, such as repeated defensiveness, passive resistance, poor communication, or a pattern of making simple tasks harder than they need to be.

• Frequent lateness or unexplained absences
• Low-level conflict or unhelpful comments
• Missed deadlines or poor quality work
• Failure to follow reasonable instructions
• Negative behaviour that affects team morale

Start with facts, not assumptions

It is easy to react to personality clashes or a bad day, but good employee relations depends on evidence. Focus on what you have seen, heard, or documented, rather than what you think the employee may be intending.

A useful approach is to separate the incident from the person. Ask: what happened, when did it happen, who was involved, what was the impact, and has this happened before? If you need a refresher on keeping these conversations constructive, our guide on handling difficult employee conversations professionally is a helpful next step.

• Record dates, times, and examples
• Avoid using vague labels like “toxic” or “lazy”
• Check whether the issue is isolated or a pattern
• Consider whether workloads, unclear instructions, or poor onboarding are contributing

Separate performance, conduct, and attitude issues

Not every difficult situation is the same. A performance issue is usually about output, quality, or capability. A conduct issue is about behaviour, such as rudeness, aggression, or refusal to follow reasonable instructions. An attitude issue often sits somewhere in between, but it still needs to be translated into clear behaviour you can address.

This distinction matters because it helps you choose the right response. A skills gap may need support, training, or clearer targets. Behaviour concerns may need a formal discussion, expectations reset, or escalation through your normal people process. Keeping these categories separate also helps avoid inconsistent treatment across the team.

Have a fair, structured conversation early

Do not wait until frustration builds. Address concerns early, before the situation spreads to other people or becomes a bigger conflict. A calm, private conversation is often enough to reset expectations and stop a pattern from continuing.

Plan the meeting in advance. Explain the concern, give the employee a chance to respond, and stay focused on specific behaviour rather than general criticism. If you want a practical approach to preparing for this kind of discussion, Flora HR can support managers with outsourced HR support and employee relations advice tailored to small businesses.

A good structure is: explain the issue, describe the impact, hear their side, agree what needs to change, and confirm how you will review progress. That keeps the conversation professional, even if the topic feels uncomfortable.

• Hold the conversation privately
• Use clear examples rather than opinions
• Listen before deciding what to do next
• End with agreed actions and a review date

Use clear expectations, documentation, and follow-up

Once you have spoken to the employee, make sure expectations are written down clearly. This does not have to be overly formal, but it should be specific enough that everyone understands what needs to change and by when.

Document the issue, the conversation, the agreed next steps, and any support offered. In a small business, good records help you stay consistent and reduce the risk of misunderstandings later. They also make it easier to track improvement over time, especially if the situation continues.

Follow-up matters just as much as the first conversation. If the employee improves, say so. If the behaviour continues, refer back to the previous discussion and the agreed process. Regular check-ins can also help, which is why some businesses pair this approach with regular feedback meetings that improve retention.

• Confirm the main points in writing
• Keep notes factual and neutral
• Set a realistic review date
• Recognise improvement as well as concerns

Common mistakes that make situations worse

One of the biggest mistakes is being inconsistent. If one employee is challenged for behaviour and another is ignored for the same thing, the team will notice. Inconsistency can damage trust quickly, especially in a small business where people see how decisions are made.

Another common error is letting frustration shape the response. If you avoid the issue for too long, react emotionally, or speak to the employee in front of others, the conversation is more likely to become defensive. It is also unhelpful to jump straight to disciplinary language when a more measured, informal approach would be more appropriate.

Poor communication is another risk. If expectations are unclear, or the employee is never told whether they are actually improving, the situation will likely repeat. For managers who want to reduce friction across the team, it can also help to think about the wider workplace environment, including support and morale. Our article on low-cost wellbeing ideas for small businesses is a useful companion read.

• Do not rely on hearsay alone
• Do not handle sensitive feedback in public
• Do not apply different standards to different people
• Do not leave the employee guessing about expectations

When to escalate and when to ask for HR support

Sometimes a straightforward conversation is enough. In other cases, the issue is repeated, serious, or affecting other people in the business. That may be the point to move into a more formal process, especially where behaviour is persistent or there are concerns about misconduct.

You should also consider external HR support when you are unsure how to handle the situation, when there is conflict between managers, or when you need help keeping your approach fair and consistent. For small businesses without an in-house HR team, that support can make difficult employee issues feel far more manageable.

If the situation is starting to involve team conflict, you may also want to consider whether workplace mediation is appropriate before matters harden further. Our guide on when employers should consider workplace mediation explains where it can help.