At this point in time, the best approach, according to me, is for you to talk to the employee, share the concerns of the employee and the company, and understand the reason why the employee is working in a different place instead of with your company. After the discussion, you can then come up with a solution or an alternative. Based on the discussion, you can also determine the rewards and reinforcements for a certain group of employees.
You can try this out and let us know if it worked or not.
Thanks & Regards,
Amit Jadhav