Custom Post Type rewrite redirects to homepage

I have a custom post type registered called employees. When registering this custom post type I used:

...
'rewrite' => array('slug' => 'people'),
...

Now, when I hover over a link to one of my employees I see the url as this:

www.example.com/people/john

So that seems correct. But I click the link, I see Chrome navigate to just www.example.com/john and then that doesn’t exist so it redirects to www.example.com (the homepage).

How do I make it navigate to /people/john and stop it from redirecting to the homepage?

The most important args for rewrite redirects when registering new post type are:

• ‘public’ => true,
• ‘publicly_queryable’ => true,
• ‘query_var’ => true,

I have pasted some code below which I have tested and it working fine for the url : www.example.com/people/john

$labels_employee = 
array('name'       => _x( 'Employees', 'Post typegeneral name', 'textdomain' ),
'singular_name'    => _x( 'Employee', 'Post type singular name', 'textdomain' ),
'menu_name'        => _x( 'Employees', 'Admin Menu text', 'textdomain' ),
'name_admin_bar'   => _x( 'Employee', 'Add New on Toolbar', 'textdomain' ),
'add_new'          => __( 'Add New', 'textdomain' ),
'add_new_item'     => __( 'Add New Employee', 'textdomain' ),
'new_item'         => __( 'New Employee', 'textdomain' ),

$args_employee= array(
            'labels'             => $labels_employee,
            'public'             => true,
            'publicly_queryable' => true,
            'show_ui'            => true,
            'show_in_menu'       => true,
            'query_var'          => true,
            'rewrite'            => array( 'slug' => 'people' ),
            'capability_type'    => 'post',
            'has_archive'        => true,
            'hierarchical'       => false,
            'menu_position'      => null,
            'supports'           => array( 'title', 'editor', 'author', 'thumbnail', 'excerpt', 'comments' ),
    );

register_post_type( 'employee', $args_employee );