Byappointment Africa
Bespoke Recruitment

Making a bad hire can have serious consequences for an organisation, both in terms of financial costs and the impact on team morale and productivity

The cost of a bad hire - By Appointment Africa

Bad Hire

The cost of a bad hire

May 30, 2023

In this article, we will explore the cost of a bad hire to an organisation and why it is important to take steps to avoid making bad hires.

Firstly, the financial costs of a bad hire can be significant. According to a survey conducted by CareerBuilder, 41% of companies estimate that a bad hire costs them more than $25,000, while 25% of companies estimate that it costs them more than $50,000. These costs can include recruitment and training expenses, lost productivity, and legal fees if the bad hire results in a lawsuit.

Recruitment and training expenses can be particularly costly for organisations. If a new hire turns out to be a bad fit, the organisation will have to restart the recruitment process, which can be time-consuming and expensive. In addition, training expenses will have been wasted, and the organisation will need to spend additional time and resources training a replacement hire.

Lost productivity is another significant cost associated with a bad hire. If a new hire is not able to perform their job duties effectively, it can lead to delays, errors, and missed deadlines, which can impact the entire team’s productivity. Furthermore, if the bad hire is disruptive to the team or causes conflicts, it can lead to decreased morale and motivation, which can further reduce productivity.

Finally, a bad hire can have legal consequences for an organisation. If the bad hire engages in illegal or unethical behaviour, the organisation may be held liable for their actions. This can result in legal fees, fines, and damage to the organisation’s reputation, which can impact its ability to attract and retain employees and customers.

Given the significant costs associated with a bad hire, it is essential for organisations to take steps to avoid making bad hires in the first place. In addition, organisations should ensure that they have a clear understanding of the job requirements and the skills and attributes required for success in the role and conduct competency based, unbiased interviews.

It is also essential to involve multiple stakeholders in the hiring process, including team members, managers, and human resources professionals. By involving a variety of perspectives, organisations can make more informed hiring decisions and ensure that new hires are a good fit for the team and organisation’s culture. (The culture fit of the candidate is as important as the technical fit)

We operate a ten step, in depth and extremely thorough process to ensure a successful placement on time, every time.