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If you want to make your workplace more fun, take a look around your premises and see how you can make it visually more pleasurable. A pop of bright colour is always a great way to add a vibrant and relaxed touch, whilst posters and artwork can help reflect a fun business personality.
The best way to do this with a bad employee is to frame the conversation as an opportunity for you to get to know each other better, and to remind them that your goal is to help and support them. Keep it non-confrontational; my goal in dealing with problems on a team is to keep everything neutral or positive.