Hiring the Wrong Person

A bad hire is a hiring decision that doesn't work out and results in the employee being let go early, or in the employee remaining in the position without being able to perform effectively in the role.

It's rarely because the candidate was bad. Most often, it's because requirements profile was unclear, that the evaluation was based on gut feeling, or that the manager and employee had different expectations for the role. The cost extends far beyond the paycheck.

What is a bad hire?

There is no legal definition, but in practice, three situations are considered. The first is when employment is terminated during probationary employment or shortly thereafter. The second scenario is that the person resigns within the first year, often citing that the job wasn’t what was described. The third is the “silent” scenario: the person stays but never performs at the level the role requires, and no one addresses the issue.

A probationary period is the most common review point. According to the Employment Protection Act (LAS), a probationary period may last no longer than six months and may be terminated by either party without cause, but advance notice must be given—typically two weeks—and the union must be notified if the employee is a member. Collective bargaining agreements may contain different rules. However, the existence of a probationary period does not provide protection against hiring the wrong person. It merely gives you an opportunity to correct a decision that has already cost money.

The reasons can almost always be traced back to the process. The role was defined after the fact; a candidate who made a strong impression was asked fewer critical questions than the others; references were dutifully checked at the last minute; or an internal decision regarding responsibilities and authority was postponed until after the hire. It is the weakest link in the recruitment process that determines the outcome, not the strongest.

How much does a bad hire cost?

Never give a single figure. The cost depends on the role, the salary level, how quickly you discover the error, and what the person was responsible for. What you can do is count the items. They usually look like this:

• Salary and related expenses during that time. Salary, employer contributions, benefits, and equipment throughout the entire period of employment, including the notice period.
• Training. Orientation, training, certifications, and the time colleagues spent training the person.
• Drop in productivity. Work that wasn't done, deals that weren't closed, projects that stalled or needed to be redone.
• Management Time. Follow-up meetings, documentation, discussions with HR and the union, and the actual termination.
• Resuming the recruitment process. A new process from the start, a new fee, new advertising, and yet another period with the position unfilled.

Added to this is the impact on the team, which is difficult to quantify but is often the most significant factor. Colleagues have had to cover for the employee, perhaps for a long time. Customers or internal clients have had a point of contact who failed to deliver. A terminated employment raises questions about management’s judgment, and in the worst-case scenario, someone else on the team may decide to look for another job.

All in all, a bad hire often ends up costing the equivalent of several months’ salary—and significantly more for key roles. The point isn’t the exact figure. The point is that the cost is almost always higher than what a proper hiring process would have cost.

Common Mistakes That Lead to Poor Hiring Decisions

1. To start applying before the job requirements are finalized. When requirements are formulated as the process unfolds, they are unconsciously tailored to the candidates who happen to be available. As a result, you end up choosing from the wrong pool of candidates.
2. Relying on gut instinct when making the final hiring decision. The structure remains consistent throughout the entire process and is revealed during the decisive meeting. A strong first impression then carries more weight than any other supporting information.
3. Checking references too late and too superficially. References checked after the decision has effectively been made serve as confirmation rather than verification.
4. Failing to take action during the probationary period. The signs are usually there early on. Hoping that things will work themselves out only increases the cost and makes the breakup harder.

Here's How Talent Search Works to Avoid Hiring the Wrong People

We do most of the work before the first interview. A job description that outlines what the person is expected to accomplish—not just the desired qualities—is what makes it possible to conduct a fair assessment. After that, we follow the same process for all candidates, all the way through to the reference check.

• We align the requirements profile, scope, and expectations with you beforehand the search starts.
• We evaluate all candidates based on the same criteria, in structured interviews.
• We'll stay in touch during the first few months so that any issues can be identified early on.
• If the role is difficult to define, an interim solution through Interim Search can provide you with the answer before you hire.

The fact that nine out of ten clients return to us is largely due to this very aspect of our work. It’s rarely the speed of the placement that determines whether a client gets back in touch, but rather whether the person is still with the company and performing well a year later.

Frequently Asked Questions About Hiring Mistakes

How much does a bad hire cost?

The cost often amounts to several months’ salary, but depends entirely on the role and salary level. Fact in salary during the employment period, training, lost productivity, management time, and the cost of repeating the recruitment process. Add in the impact on the team, which isn’t reflected in the books but affects delivery.

How quickly do you realize you've hired the wrong person?

The signs often become apparent within the first few months—that is, well within the probationary period. What usually delays their detection is that no one has set clear goals for the initial period. With check-ins after one, three, and six months, the picture becomes clear early on.

How can you avoid hiring the wrong person?

Through a clear set of requirements, a standardized assessment process for all candidates, and reference checks conducted before a decision is made. Also, take the time to provide a thorough orientation, since a large proportion of unsuccessful hires stem from unclear expectations rather than a lack of the necessary skills.

Can you terminate an employment relationship that isn't working out?

A probationary period may be terminated by either party without cause, but advance notice must be given, and the union must be notified if the employee is a member. After the probationary period, valid cause is required for termination. Always check what your collective bargaining agreement says before taking any action.

Have you ever hired someone who didn't work out? Talk to us about what went wrong and how the next process should be structured.