Background: In a modern world where globalization and competition are being intensified, an organization’s success depend on employee performance and well-being. Technological, economic, demographic, and social changes are reshaping work, often resulting in unsustainable expectations that contribute to declining employee well-being. As a result, employee well-being has gained significant attention in both research and policy frameworks. Promoting employee well-being is particularly relevant for SMEs who represent 99.9% of all businesses in Sweden. Leadership is central to success of SMEs as leaders influence employee outcome. Therefore, prioritizing employee well-being through good leadership is key to ensuring success in today’s business environment.

Purpose: As companies grow, leaders face managerial challenges which can impact their ability to maintain a healthy work environment. Research on how leaders navigate the pressures of growth while balancing employee well-being remains limited. Consequently, the purpose of this study is to explore how leaders in SMEs perceive and promote employee wellbeing during growth, using the leaders’ own experiences as a foundation.

Method: This study uses qualitative research grounded in a relativist perspective and guided by an inductive approach. Data was collected through nine semi-structured interviews conducted with leaders from seven different companies. The data was analyzed using thematic analysis.

Conclusion: The findings of this study showed that leaders perceive and promote employee well-being in growing SMEs in different ways, shaped by their organizational context and personal understanding. However, all leaders emphasize employee well-being as being central to organizational success and their role in promoting employee well-being during growth. Leaders highlighted the importance of communication, trust, and adapting to individual needs, using both informal and formal organizational tools, while also emphasizing personal responsibility including leader and employee self-care. The majority of the leaders recognized that growth introduces leadership challenges, however, few viewed growth as positively. Lastly, the findings suggest differences between internal and external ownership in growing SMEs, particularly in how they affect employee well-being and organizational culture. It is also suggested that smaller SMEs better support employee well-being, while medium sized companies face greater challenges.