How Much Your Bad Hires Cost You and How to Fix It

It happens all the time. A HR manager goes through the lengthy hiring process to find the perfect applicant for their open position. They find their ideal hire and process all the paperwork. Two weeks later, the new employee shows up for their first day. It’s all going swimmingly. Then reality hits hard. The new hire is not up to snuff on what they said they were, they’re not engaging with the team and they’re sucking time and resources from everyone who needs to pick up their slack.

The hiring manager, while frustrated about the new hire’s failure to deliver, doesn’t feel it’s that big of a deal and crosses their fingers, hoping it’ll get better. Everyone makes hiring mistakes, and it’s better to have a body on the team, so it’s no big deal, right? Wrong. A poor hire is one of the most expensive mistakes a manager can make in many ways. They can drain morale, money and more when left to their own devices. But there are certainly ways to appease the situation.

The Cost

The hiring process is extremely expensive and replacing an employee can cost up to 30 percent of that employee’s salary, so it’s important to do everything to get it right the first time. When a position turns over, employers run the risk of losing valuable knowledge, experience and expertise if they don’t hire the right candidate to replace them. Because of this, the team also suffers, especially if the hire is less knowledgeable and not fitting with the team. Morale can drop to record lows as the other members of the team feel like they have to work harder to make up for the employee’s ineptitude. This can cause higher levels of turnover if managers don’t actively do anything to make changes.

Less Efficient & Work Delays

When employers hire a less-than-equipped candidate, they open themselves up to potential problems on their work-sites. If the new hire isn’t as familiar with the equipment as they should be, it puts your entire team at risk of accidents and injuries. Under-qualified workers also make for less efficient work. These delays on work-sites can compromise your relationships with clients and potentially cost future contracts. High accident, injury and delay rates on your work-site can give your company a poor reputation among job-seekers and clients alike, making it harder for you to turn a profit in the future. Nobody wants to work with or for a company that won’t deliver on promises of product or safety.

Employers: Here’s What You Do Next

While it’s unreasonable to think you can turn an under-performing new hire into a rockstar overnight, there are steps that you as an employer can take to improve the situation. Much of this happens before a hire of any kind is made. Prepare your existing team for a little more work as a new hire gets up to speed and also ask if anyone would be willing to mentor the employee in their first months with your company. This tactic pulls double duty because it immediately gives the new hire relationship on the team and improves morale, which will help the new hire learn faster. Also immediately address issues as they arise and develop a learning plan that is relevant to the new hire’s position. Sometimes a new hire just needs a little nudge to become the employer you need. That being said, it’s up to you as the employer to decide if the costs and risks of training outweigh the costs of hiring an alternative employee.

The Bottom Line

Never let a bad panic hire to go unchecked. While making a poor hire is an all-too-common occurrence, there is no excuse for failing to develop the new hire once problems are noticed. There are clear, tangible steps that can be taken to help hiring managers select the best possible candidates. By communicating with your existing workforce, committing to developing and mentoring employees and addressing issues as they arise, you can turn a bad hire into the competent, capable employee you were looking for.

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