The cost of hiring the wrong employee
When it comes to recruitment, hiring the wrong person can be financially detrimental to your business. Learn more about the costs of a bad hire here
When it comes to hiring new employees, getting it right first time is extremely important. The cost of a bad employee is likely to far outweigh the value of their contribution to the organisation. A bad employee results in a multitude of costs, both direct and indirect, short and long term, which will impact on your organisation. Just some of the costs of hiring the wrong employee include:
The hiring costs themselves, once you take into account all relevant advertising and administrationcan be substantial, not to mention the time it took you or other colleagues to complete the process. However, an established recruiter like REED will always offer a rebate period – sometimes up to a 12-month guarantee – or a free replacement, if, on the very rare occasion, things don't work out.
Throughout the period of employment, your new employee will be receiving their salary plus any other benefits offered by your organisation. A long-term bad employee may require a 'severance' package or fee, or at worst case scenario, result in litigation costs.
It is likely that you will have invested in significant training to help get your new recruit up to speed with any software, programmes, or even just the ins and outs of their role. External training is typically more expensive than in-house training. However, even in-house training must be budgeted for and any time spent away from their desk is time when they are not directly contributing to the organisation's objectives. More information about how to train new employees here.
Impact on colleagues
A bad employee is likely to impact colleagues because they will undoubtedly be required to 'nanny' the new employee through their role – and probably take up the slack – thereby detracting from their own performance. Increasing stress levels and decreasing morale will also impact on productivity. This applies to managers and co-workers alike and affects them not only during the period of employment of the new employee, but also during the time it takes to re-hire.
Mistakes and missed opportunities
All the time in which your new employee is sitting at their desk not doing their job properly is a missed opportunity for your organisation. Furthermore, perhaps your new member of staff has actually made mistakes or poor business choices which will be detrimental to your organisation and cost extra time, money and effort to fix. The impact of hard to quantify mistakes can be some of the most lethal, such as lost business or tarnished reputation.
Remember - a lot of the above is a 'worst case scenario' story, but it's always worth keeping this kind of possibility in mind, if you think your recruitment and screening processes might not be up to scratch.
Or for more employer advice articles click here.