What is the cost of a bad hire?

The cost of a bad hire cannot be underestimated. Besides the more overt costs, there's also the matter of how a bad hire can have an impact on the workplace culture at large.

Run-of-the-mill costs 

Some costs will be immediately obvious to your company upon recruiting a bad employee. 

You will have wasted money with the employee's salary that does not reflect the employee's productivity.

First of all, there is the time and cost of recruitment. You will have wasted money on an employee's salary, which does not reflect the employee's productivity and contributions. Robert Half also explains how training takes a long time and is already an investment, so you will have lost money and time in that regard as well. Once you finally do fire this person, you'll also have to incur recruiting costs again.

It's for this reason that, the longer you drag out trying to find a place for an employee who simply doesn't fit, the greater the financial loss your company will experience. The moment you determine the employee is not the right fit for your business, you should be trying to resolve the situation.

The effect on other employees 

A particularly disengaged employee only brings more trouble by influencing the behaviour of others. A recent Robert Half survey found that 23 per cent of HR managers believe a poor hire decreases overall staff morale. 

Falon Fatemi, founder and CEO of Node, wrote an article in Forbes about how when an unproductive employee is not doing enough, the other employees must scramble to make up for where they are lacking. These employees eventually get burned out and become resentful that they're doing more than their fair share for no extra pay.

The cost of the other employees getting frustrated or influenced by the one bad one can be substantial.The cost of the other employees getting frustrated or influenced by the one bad one can be substantial.

When Fatemi encountered this problem at her company, she was forced to expend time and energy trying to hold onto the good workers when really, she should have had better HR policies in place to exit the problematic employee. Having one bad employee had caused two (nearly three) of Fatemi's hard working employees to quit.

The difficulties don't end there, either. Once the worker is let go, Fatemi explains that it takes awhile to reorient group behaviour and eliminate any bad habits that people may have learned from the disengaged employee. 

It's for these reasons that hiring good employees right off the bat will save you a lot of money and headaches. Flexi Personnel's Recruitment Consultants are experts at identifying employees that will help your company rather than bring it down. Contact one of our Consultants today to find out more about our recruitment services.