Does exercise improve employee performance

It depends on how you define "performance". If you mean productivity, alertness, happiness on the job, and general well-being, then the answer is probably Yes.

There is a whole industry sprouting up around employee wellness, of which exercise is a significant component. Various studies have been undertaken over the years, particularly by Steven Aldana of BYU, and Dee Eddington, University of Michigan, that measure the positive affects of employee wellness programs. These studies universally prove the benefits to employees and more recently to employers for participation in exercise, diet and other wellness-focused initiatives.