Is there a special reason why: "Employees are respecting the boss" is not accepted?
Yes. "Szanować" [to respect] is one of verbs that translates exceptionally to Simple Past, Simple Present or Simple Future (in some cases Past Perf. Cont. or Present Perf. Cont.)
The Present Continuous could be used with "Okazywać szacunek" [to show respect, to express the respect].
A detailed explanation what is it about you can find in Aspect of Verbs in Polish, Verbs of Singular, Multiple and Completed actions (according to that article, "szanować" is a durative verb of "repetitive or habitual action").
It marks "the staff respect the boss" as wrong. In English, we do not say "the staff respects..." because staff is a group word.
I decided to be a smartass and entered "female workers" losing a heart as a result :c