In today’s workplace, it is essential to avoid bad hires. These employees will have financial consequences for any organization. Estimates indicate that it costs over $250,000 to find and hire a new employee, and when you add the amount of money it will cost to replace that person, the situation becomes dire. The typical costs associated with a bad hire include:
- Recruitment fees and staff time
- Relocation and training fees for replacement hires
- Negative impact on team performance
- Disruption of projects
- Lost customers
- Weakened brand
- Litigation fees
Bad hires set off a chain of events that not only affect a company’s finances but its productivity and reputation too. Employees who perform well for your company will suffer consequences due to a lousy employee as they struggle to make up for the person’s lack of effort. Ultimately, the cost of a bad hire stretches way beyond their tenure with your company.
It is no secret that a bad hire will have a significant impact on your company. Because the employee can’t perform the job, close the sale, or manage the process, they cost your company money. Furthermore, the expenses associated with a bad hire add up to be a considerable sum. These hiring expenses include travel, hotel and meals, training and orientation, and employment testing. Firing this bad hire entails costs such as Cobra, unemployment, and maybe even legal fees. Finally, it would help if you considered the cost of repeating this process with a replacement employee.
A bad hire can affect productivity, and this can have a significant financial impact on your organization. If an employee is not suited for the job, maintains a lousy attitude, or is incompetent, the time wasted dealing with these issues can affect your finances. If a bad hire does not possess the skills they claim, your other employees may have to step up significantly to meet production deadlines. Unfortunately, good employees typically end up leaving, taking their skills, knowledge, and expertise with them. Even your employees who choose to stay might quickly become frustrated with their jobs.
When the bad hire causes your company’s customer service to suffer, the reputation of your business will decline. All bad hires, especially those who deal directly with clients, can permanently damage your company’s reputation costing you money. Please understand that the cost of obtaining a new customer will always exceed that of keeping an existing customer.
Avoiding a bad hire
An excellent way to prevent a bad hire is by using a staffing agency such as SIS. At SI Staffing, every prospective job candidate receives phone and in-person interviews, drug check, background check, reference check, and a skills assessment. SIS can help you avoid bad hires, save money, and stay on schedule.