A user's line manager will have access to the users profile for things like recording sickness and approving holidays. For an overview of a managers permissions please check the link - Permission Article

To add a line manager to someone's profile you will firstly need to go to that user's profile. This can be done via the 'People' list on the left - highlighted below:
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Once you click into the user's profile you will need to go into their 'Job Details' screen. You can 'Add' top right - Highlighted below:
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When you add the job details you will see the required fields and one of which is 'Line manager'.
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Please note you can list multiple job details/managers for a user, you can add another active line as long as there is no end date for either record.