Ask any company management and most will agree: one the costliest mistakes a company can make is a bad hire. Repercussions include:
• Time factors: not only is the time you spent in recruiting, onboarding, and training all for naught, you now have to start over, and you needed the new hire to be at full working capacity yesterday.
• The time that your staff put into onboarding and training took away from their responsibilities. Now they will have to do it again and fall even farther behind schedule.
• Most studies indicate that the cost of a bad hire is 2.5 times the salary of the position.
• Company morale and gone down and negativity is up – not what you were looking to happen.
• The positive company growth that motivated the hire is now on hold.
• If the opening was the result of previous staff leaving for greener pastures, the bad hire experience might send additional staff looking for new positions.
• In some instances, terminating the bad hire can result in legal expenses.
Ok – you say – point taken, but you don’t just want to hear why a bad hire is costly – you get it. What you’re looking for is how to handle it and ways to prevent it from happening in the future.
How to handle it:
Step one: Confirm that you made a bad hire. Sometimes you just have a slow starter or there are unexpected circumstances behind the scenes. For example, Company B was concerned when their new employee didn’t appear to be making the mark. Then they discovered that the week before he started, his wife filed for divorce, and his distraught daughter was seriously injured in an auto accident. Common indicators of a bad hire include substandard work, failure to meet deadlines, actions that result in client or customer complaints, poor attendance couple with bad attitudes and inability to connect with the team, and finally, and obviousness that they had significantly misrepresented their abilities.
Step two: Practice these words. I made a mistake. I chose a bad hire. There now, you got it off your chest and quite frankly, admitting you messed up instead of blaming others or “the system” will give you the clarity to understand how to respond and the freedom to do it.
Step three: Prepare to terminate. Start by lining up all your legal ducks in a row – especially if the bad hire happens to fall in a protected class. Just because the termination has everything to do with their level of skill and/or their ability to work with the team and nothing to do with who they are, it may still “look” like discrimination. Document everything – that proves the call for termination – that is the person’s inability to perform or even to learn to perform the required tasks. This documentation includes actions, behaviors, misrepresentations, incidents, communications between said party and pertinent staff.
Step four: Tell the employee. Be as kind and respectful as you can be. Always have a second person present to act as a witness. Make it clear to the employee that the responsibility falls on your shoulders – even if he/she intentionally misrepresented him/herself, assume that you should have had better discernment – that you made a mistake; termination is the only correction, and you wish nothing but the best for the employee.
Step five: Pay them for all the hours worked plus a termination fee plus a goodwill fee. Ask them to sign a separation agreement in return. It is far less costly to go overboard here than to deal with legal battles or social media destruction – which leads to step six.
Step six: Pay very careful attention to your company’s social media. Do whatever you can to be brand strong, but do not respond to any venting of the terminated employee – under any circumstances. If appropriate – particularly if you are a high profile company – you can wish them a public goodwill, but stop there. Remember, the high road might be difficult, but taking it always pays off at the tollbooth.
Ok – now you’ve dealt with the issue, but how can you prevent this from happening again. We will cover that next week – in Part Two of the Case of the Bad Hire.
Meanwhile, contact Springborn. We specialize in helping Bangor and Portland, Maine companies connect with the right talent – every time. We are your shield against bad hires. Contact us today.