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How to handle a bad hire

How to handle a bad hire

Unfortunately, despite the many measures and policies organisations take to ensure they hire the best people for their roles, occasionally a business may encounter unexpected problems with a new starter.

Despite having all the right credentials and seeming to breeze through the interview process, the ‘ideal’ candidate can, for whatever reason, turn out to be unsuitable for the position they’ve just filled.

So how do you manage this unexpected problem when it happens, and how do you reduce your chances of it happening again?

Firstly, what is a bad hire?

Broadly speaking, a bad hire is someone who doesn’t work out in the role they were initially recruited for and ultimately leaves the organisation (either of their own accord or through termination of their contract) within the first 18 months.

Although there are many reasons why a new hire might not work out in a role, according to the employment website CareerBuilder, the two key reasons a new starter is deemed unsuitable for a role are:

1.      Their values don’t align with that of the organisation; or

2.      Their skill and knowledge level do not match the requirements of the role.

The high costs of a bad hire

A study from The Australian, quoted in Business Review Australia, revealed a bad hire can cost a business up to 2.5 times the salary of the employee.

Some of these financial costs include:

  • Time and money to recruit

  • Time and money to onboard and train

  • Salary and entitlements whilst employed – to add to this, a competitive candidate market means that it’s very much an employee’s market for salaries

  • Cost to re-hire

  • Impact on team productivity and morale

  • Potential legal fees

A poor hiring decision can be very time consuming and expensive, and it can also lead to loss of customers, reduced office productivity, and damage to staff morale.


3 steps to managing a bad hire

So, you’ve come to realise that your new hire may not be the right person for the job – what do you do next?

1. Engage them in open dialogue

During the probationary period, you have lots of flexibility to make the choices you need to - so it is important that as soon as you discover your new hire might not be the right fit, you have a very clear and honest conversation with them to share what you’ve observed that’s not working well.

Often there are cases where the manager has observed ‘red flags’ from the employee, but when they’ve spoken to them, it has come to light that there is something going on at home, or there was a misunderstanding such as their role not being been clarified, or they weren’t given a proper introduction and training. Under remote working conditions, some of the standard onboarding steps can be missed, and it can be hard to see exactly why some employees are taking longer to learn the ropes.


2. Take action

The best thing you can do is identify the problem and determine if and how it can be resolved. Any actions you discuss and agree to should be actioned as soon as possible. Exact timeframes will depend on the reason why the new hire is not working out.

Did you hire a great worker but for the wrong position? Can you transition them to a better fitting role? If training is identified as the reason why the employee isn’t picking up tasks within the expected timeframe or making repeat mistakes, offer additional training.

More immediate action may need to be taken where there is an issue with behaviour or conduct – but probationary periods exist for a reason and if the employee isn’t the right fit, then you may need to part ways.


3. Implement performance improvement plans

Advise the employee where your expectations are not being met and what could be done to make an improvement. Set clear and measurable goals related to job performance and attitude, and ensure that you revisit these expectations on a regular basis to ensure they are on track to being met.

If the company has done all it can to induct and support the employee, the person may regrettably be a bad hiring decision.


How to avoid making the same mistake twice

If you do end up having to terminate the new hire, to avoid making the same mistake twice, you might consider conducting an exit interview.

Exit interviews can help hiring managers gain some insightful feedback from the employee around the recruitment process. Employees tend to be more candid when leaving an organisation and can provide feedback that might not have been gained otherwise.

Relevant information from an exit interview could include:

  • Whether or not the job advertised was a realistic portrayal of the role the new starter was asked to do; and

  • Whether or not the new starter felt supported in their onboarding process.

The revelations from these exit interviews can then be used to improve current hiring practices and avoid those same issues occurring in the future.

Many bad hiring decisions result from a lack of planning at the start of the recruitment process – so it is crucial that you have a robust and well-thought-through process. Before going to market, put together a well-considered position description and have a clear understanding of the skills, attributes and behaviours that make up the selection criteria. List your ‘must haves’ and your ‘nice to haves’!

Ensure your process is consistent and that you conduct structured interviews. Developing a strong interview guide that includes carefully crafted questions designed to draw out responses that include specific examples and give the required depth of insight into a candidate’s suitability – not only for the role, but the organisation. You may even decide to ask the shortlisted candidate to complete skills or psychometric testing to gain a better understanding of their skill level and behaviours.


A recruitment agency can help you find the right hire

As role demands and employee expectations both rise – and the talent pool shrinks – it’s never been a better time for organisations to test out the skills of a specialist recruitment agency. BWS Recruitment have been connecting companies and talent for over 26 years and specialise in filling specialist and executive roles – fast.

We also offer a 3-month guarantee; which means in the unlikely event that your new starter doesn’t work out, we will refill the role for you free of charge! Learn more about the benefits of using a specialist recruitment agency, and when you should engage one here.

If you have a job vacancy you need assistance filling, please don’t hesitate to give us a call on 03 9535 9500 and we would be more than happy to find your next great hire.

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