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Once other employees see that you aren't messing around they will step it up a notch and get the employee peer pressure to do a good job. Managers need to be strict but fair.
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Looks good on paper but let me quote a former employer I talked to recently. I asked why his employees don't seem to be adhering to the standards I used to work under. I kidded him about getting old and soft. His answer was this:
"These kids today aren't like they were when we were young. Kids today don't really want a job. They don't care what you think of them. You can only fire so many before you run out of kids. They come to work only because their parole requires it. You can't fire them just because they don't care about their job or they sue you."