Document everything.
In these days of litigastion for the drop of a hat it is always wise to be always on your guard. I hate to say it but that is the way of the world these days.
You need to have processes in place to protect yourself from this sort of allegation and also to protect your staff.
They need to understand those processes too. As someone said above- clear objectives, weekly 1-2-1s . If someone is not performing you need to be clear and explain that to them, put in place improvement goals and make sure they understand that if you have to go down the route of dismissal you will have covered all your bases.
I have been there and I know how stressful this is . Maybe take time to consider if management is really your forte too? Not everyone makes a good manager.
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