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4 Types of Employees that Could Cost Your Small Business

With unemployment rates at a record low, finding the right talent can be a challenge. In a tight labor market, fast-growing small businesses often feel the pressure to make a hasty hiring decision – a move that could prove to be expensive. 

How expensive? According to a study conducted by CareerBuilder, the average cost of one bad hire is close to $15,000 and the average cost of losing a top employee is nearly $30,000. In addition to salary costs, a hiring misstep also means lost money on employee benefits, incentives, and severance, as well as the added costs associated with hiring and training a replacement.

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What defines a wrong hire? Not producing quality work, a negative attitude, attendance issues, and not working well with other team members were the primary reasons a new hire did not work out.  

How do bad hires happen? According to the survey, nearly three in four employers are affected by a bad hire. A few reasons for making hiring mistakes include the lack of qualified candidates, feeling forced to fill the role quickly, focusing on skills and not attitude, and candidates misrepresenting their qualifications.

Read More: Finding the Perfect Match

Before you rush out to add to your staff, watch out for the employees types that could potentially undermine your business. Here are four of the most common.

Employees Putting Your Business At Risk

PHR_The StarTHE STAR. Egocentric, self-absorbed, the heat of the spotlight shines bright – but only in the mind of this charmer. A self-proclaimed star, your workplace is the stage for his indulgence as he parlays for the lead. Before you know it, his off-color remarks are bringing down the curtain on your business.

The Risks. Often viewed as stubborn and inflexible, this employee may not be coachable or open to change. According to a recent Harvard Business Review study, overconfident employees are more likely to be toxic workers. The fallout in your workplace could be disastrous and end up with a number of costly complaints and damage employee morale. Workplace training can help. Conducting an anti-harassment training program, which addresses screening and how to manage a diverse workforce, is essential in reducing risks. Also, check with your state and federal authorities on the types of HR training programs required for your particular business.

Read More: Q2 HR Checklist

PHR_UnreliableTHE INCOMPETENT EMPLOYEE. Bubbly and eager, this employee smacks with fresh enthusiasm and sparks inspiration as she waxes on into the wee hours of overtime about all of the glitter and possibilities for your business. While you are bedazzled by the spell and begin to rekindle hope for a stronger bottomline, this serial muse’s ongoing timesheet errors are costing you – oh, so extra.  

The Risks. The growth of wage and hour settlements have increased in recent years and continues to be a primary exposure for businesses. Check the labor and wage and hour laws in your state for overtime and minimum wage requirements as well as laws relating to paid breaks, work schedules, and rounding practices.

PHR_IncompetentEmployeeTHE UNRELIABLE EMPLOYEE. That flashing smile, firm handshake, locking gaze, and a style coiffed to perfection, this employee is cunning and knows how to beat the office game. Equipped with all of the slick moves, convincing excuses and shady tricks of the trade, be prepared to shell out – this employee is hard to trust and hardwired to win - at your expense. 

The Risks. Having employees that over-commit and under-deliver can cost a business their customers and good employees. Also, simple mistakes on routine HR forms, such as on Form I-9, can cost up to $1,100 in fines per violation, and fines increase to $16,000 for knowingly hiring unauthorized workers. Be diligent in checking references to understand the applicant’s previous experience and perform background checks on every employee to help you know the person you are hiring.

PHR_BullyTHE ANTAGONISTIC EMPLOYEE. This hot-headed employee flexes his power and is ruthless in spreading negativity and fear. To a bully, your workplace is a battleground where conflict rules. Just before slaying what’s left of morale, the bully has forced productivity to a complete stop.

The Risks. This employee is a lawsuit waiting to happen. Due to frequent changes in employment laws, make sure your employee handbook includes standards of professional conduct as well as specific procedures for handling employee complaints about the bully’s behavior. 

AVOID MAKING A COSTLY HIRING MISTAKE

Managing today’s workforce requires businesses to be more equipped than ever before. By partnering with a certified PEO (CPEO) like Propel HR, our HR experts can help you navigate the complexities of human resources and compliance, as well as provide guidance on how to make better hiring decisions. Let us show you how.

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The HR Division is made up of a team of professionals with a vast level of experience and HR expertise, assisting organizations of all sizes and within a wide variety of industries. They readily partner with clients to address strategic and compliance challenges surrounding the employment life-cycle and the ever-changing laws that regulate it. Inquire below about how they can help you!

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