The Heavy Cost of a Bad Hire

By January 22, 2019 Drivers, NationaLease, Recruiting

With unemployment rates so low, you may feel compelled to hire someone who isn’t the right fit. Don’t! Last month, I wrote an IdeaXchange blog, “15 tips for avoiding a bad hire,” that addresses the fact that, with the ongoing shortage of drivers and technicians, fleets may be feeling pressure to fill a vacant spot. And that can lead to hiring someone who doesn’t fit the role or your company.

So what is the actual cost of doing that? According to the U.S. Department of Labor, the average cost of a bad hire may equal 30 percent of that hire’s annual salary. Translated into dollars and cents, a person that’s earning $45,000 a year who turns out to be someone you never should have hired, actually can cost the company $58,500.

But the cost to company morale can be incalculable. As the saying goes, one bad apple can spoil the whole bunch. An employee with poor performance can lower the bar for everyone else. Bad habits that are allowed to stand can make other employees question why they need to adhere to company policy and embrace company culture when that “square peg” who doesn’t fit in the “round hole” of the organization is allowed to remain on the job.

Unfortunately, it is not always easy to spot the signs. Sometimes, you may hire someone who fits the job, but not your company culture. Other times, you may interview someone who looks like a perfect fit for the company but may not have the perfect qualifications for the job. In the second situation, you do need to give the employee a chance to succeed. However; if after a given amount of time, that employee still is not performing up to expectations, you may need to consider other steps, depending on your company policy.

If write-ups and warnings do not prove fruitful, it’s essential that you act quickly. The longer a bad hire is allowed to remain on the job, the greater the negative impact that can have on the company and ultimately on your bottom line.

Jane Clark

About Jane Clark

Jane Clark is Vice President of Member Services for NationaLease. Before joining the full service truck leasing organization, she served in executive positions with some of the nation’s top staffing and recruitment agencies.

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