9 Overlooked Costs Of A Bad Hire
By: Sarah Robins November 2, 2017
Making a bad hire is expensive. In our work with churches and ministries, we’ve found that many organizations don’t realize the real costs that are involved in hiring the wrong person. Yes, you will spend money on a few job postings and travel in the hiring process, but the costs go well beyond that.
Below are nine common costs that churches often overlook in the hectic season of finding a new staff member.
1. Your Time
I personally believe that this is one of the most overlooked expenses in hiring for your staff. Your time is not free. Time spent on hiring a new staff member is time taken away from your current job, your church's needs, and your family’s needs. It takes hours to sift through resumes, proactively reach out to candidates, review teaching samples, schedule interviews, and conduct reference checks. Make sure you have the time necessary to hire a new staff member before you dive into the process.
2. Your Team’s Time
Often, the workload associated with a staff member search is carried by a search team or other church staff members. Again, no one’s time is free.
If your church staff members are spending their time working on this hire, that’s 30-60 hours a week spent not working on their own ministries. This can certainly be expensive in the long-run if momentum is taken away from growing and thriving ministries in the church.
Most churches pay for the relocation of a candidate. (If you don’t, we strongly suggest creating a small budget for this in your next hire; it goes a long way when trying to onboard a new candidate well). If the staff member or pastor you hire doesn’t work out, that relocation cost is gone forever.
4. Ramp-up phase
This is another overlooked hidden cost to a bad hire. Once you have your new staff member in place, how long will it take for them to be fully functional? It could be 3 months, 6 months, or even a year in some positions. The church is still paying the full salary to that staff member during that onboarding phase. If a bad hire is made, that’s months of a salary paid out to an individual that wasn’t fully functioning in the job they were tasked with. And eventually, that’ll be thousands of dollars of salary out the window.
5. Onboarding costs
What onboarding costs are involved with your new staff hire? Books, curriculum, trainings, and conferences are all a part of bringing on a new pastor or staff member. Consider all of the aspects of your onboarding process and whether or not you can fit a new employee into your church budget.
Our team has a comprehensive guide to onboarding ebook that will help you think through the necessary steps to onboarding. Download the onboarding ebook here.
What is your church or organization's policy on severance? How many months are paid out if the hire doesn’t work out? This is another big cost acquired on the back end of making the wrong hire.
7. Legal Fees
This isn’t a scenario that happens often, but from time to time there’s a need for legal council with new hires. Maybe it’s just to draft a release letter or advice on an existing contract. But in some situations, it’s a much more complex situation that needs special attention. Either way, this is a scenario that is expensive and adds to the cost of a bad hire.
Consider the amount of momentum lost in a ministry when there’s a bad staff transition. It affects trust, attendance, and commitment to the church and vision. A bad hire causes emotional and sometimes even spiritual collateral damage. It’s hard to quantify the monetary loss here, but the emotional toll this can take on a church is substantial.
Lastly, a potential loss in church-wide giving cannot be overlooked. We’ve worked with many churches over the years that are suffering from a loss in giving due to a bad hire and bad exit. Though a church often has a strong core of givers, there is a high potential for giving to be affected when a bad hire is made.
Most people have been part of making a bad hire at one time or another. This is why Vanderbloemen so passionate about finding the right person. If you’re interested in calculating the cost of a bad hire for your church, try out our bad hire calculator.