Why Hiring Wrong Is An Expensive Problem for You
Hiring a new employee costs an average of $4,000-$7,645. The U.S. Bureau of Labor Statistics estimates an annualized employee turnover rate of 73.88% in hotels and motels. If you operate a 13-person staff, a 73.88% turnover rate will cost you between $148,000 to $282.865 each year. There is a solution, and it’s a lot easier than you might think.
What Can You Do?
It might be time to reevaluate your recruiting, interviewing, hiring, training, engagement, and firing philosophy. Successful employers are:
saving time and money with the 3-minute superstar screening interview,
getting honest answers to the right interview questions,
keeping superstar employees by setting free unworthy employees their first week,
developing on-boarding procedures that get new employees productive quickly,
delivering effective evaluations that make employees want to stay,
engaging employees with meaningful and diverse work,
and retiring demotivating policies so your employees can excel again.
Pro Tip: Firing an employee is stressful for both employee and employer. Make the process more positive and productive by changing your attitude. Instead of firing employees, think of it as setting them free – free to find employment more suited for their skills and temperament.
In this action guide you’ll learn to set unworthy employees free their first week so your superstar employees can excel again.
Have you ever dated the wrong person? You likely dated that person longer than either of you wished. What if you had set that person free after the first five dates? You probably knew it wasn’t going to work out after the first date. Wouldn’t it have saved you money, heartache, and time? Exactly. That’s why I propose adopting a five-workday probation period for all new hospitality employees. You will save money on training, it’s the most ethical thing to do, and you can get back to work immediately finding the right employee.
How to Identify a Wrong Hire?
There are two unforgivable sins in my businesses:
1. You are rude to the guests.
2. You are unable or unwilling to clean.
These two sins are unforgivable because you cannot train for attitude and cleanliness is so important in the hospitality industry. You must decide what is important to you. Here are some of the most common reasons to set them free in 5 days, or anytime: performance, attitude, insubordination, harassment, attendance, and safety violations. No matter the cause be sure to set them free properly and respectfully.
Pro Tip: The best way to know you’ve made a hiring mistake is to ask yourself this one question, “Would I hire this person if they came in today looking for a job?” In fact, I request managers ask this question frequently regarding their entire team. If the answer is “No, I would not hire this person,” then answer the question, “Why wouldn’t I hire this person?” That will be the reason you should set them free.
In three decades of hiring employees my companies have always paid the lowest unemployment insurance rates available because they follow a consistently applied progressive discipline policy. The employee knows company policies and standards, receives an oral reprimand for violations, receives a written reprimand, and then termination. The progression can be accelerated for certain violations like criminal, discriminatory, or harassment behaviors, for example, but such accelerated discipline must be clearly identified in your employee manual. If you adopt a 5-day probation period, you can still use a progressive discipline policy and it is highly recommended. Always follow the laws for your jurisdiction.
Why Set Them Free in 5 Days?
Set them free before they damage our online reputation.
A May 2016 Cornell Hospitality Report titled, Hotel Performance Impact of Socially Engaging with Consumers, re-confirmed an earlier study that hotel revenue is directly associated with TripAdvisor ratings. Better ratings equal increased revenues. Don’t wait until you get the disparaging reviews.
Set them free before they cost you thousands in training.
Hiring a new employee costs an average of $4,000-$7,645. The U.S. Bureau of Labor Statistics estimates an annualized employee turnover rate of 73.88% in the hotel and motel industry. If you operate with a 13-person staff, a 73.88% turnover rate will cost you between $148,000 to $282.865 each year. Set them free in 5 days before you spend thousands on training an unworthy employee.
Set them free before they cause your superstars to leave.
You probably already know that employees quit because of a bad boss. It’s generally considered one of the top reasons employees leave. In the same vein, employees leave when they are required to work with rude, unproductive, or bully employees. Set the unworthy employee free in 5 days to keep your superstar employees from leaving.
Set them free before it becomes problematic to set them free.
There are many ways terminating an employee can become problematic. Unemployment insurance liability may not go into effect until a certain number of days of employment. For example, in Illinois an employer is not chargeable until the thirtieth day of employment. That means if you terminate the employee and they make an unemployment insurance claim you can deny your chargeability based on the 30-day rule. The longer the employee works the harder it can be to terminate an employee due to misplaced compassion and weak bench strength. Set them free in 5 days to avoid complications of time.
Is It Legal & Ethical to Set Them Free in 5-Days?
Consult legal counsel in your jurisdiction to determine if this is legal, but in most cases, as long as you are not violating discrimination laws, it is legal. Is it ethical? Let’s recognize that not all jobs are for all people. Hospitality jobs are especially rigorous. The hours, the guests, and the work are all demanding. It takes a special person. Also, if the job is not a fit, neither the employee nor the employer is happy. Why should you or the employee prolong the dissatisfaction longer than five days? What is the point of waiting the 30, 60, or 90 days of the traditional probation periods? You know they don’t fit. They know they don’t fit. It is a kindness to set them free to seek satisfying employment elsewhere.
Pro Tip: Implement a progressive discipline process for employee behavior issues and to inform the employee there is a performance problem and an opportunity for improvement. Typical steps include:
1. Verbal Counseling: Counsel the employee of a behavior issue and the company policy violated with a warning that continued inappropriate behavior may result in termination. This step is delivered verbally but you must document this discussion in the employee’s written record – date, time, and what was discussed. Some policies, like theft and safety violations, might trigger immediate termination if stated in the employee policy manual.
2. Written Reprimand: Discuss a twice repeated offense and document in a written form. Employee gets a copy.
3. Termination Reprimand: Deliver a final written reprimand for a thrice repeated offense. Employee gets a copy.
Why Do Managers Hang on to Dead Weight?
There are two main reasons. First, they don’t have any bench strength – no one waiting to fill that position. The solution is to be in a constant state of hiring. When a superstar walks in your door you better hire them – available position or not. Put their start date two weeks into the future. You’ll have an opening by then, I promise. Second, the manager feels it’s an act of compassion to give the new recruit a million chances. How’s that working for you? Set the trainee free in five days and take control of your position vacancies instead of frantically trying to fill holes left when they quit without notice.
Finally, you maximize your staff’s productivity by setting free an incompetent employee the first week. First, your trainer can either get back to normal duties or start training a worthy candidate. The quicker you bring on the next candidate, the faster you can have a productive employee on the crew. Second, your top performers won’t have to work with an incompetent employee for the next 90 days before you decide to terminate their employment, or they find another job and leave. Top performers will be dissatisfied working with slackers. You’ll lose them over time if you don’t give them competent people to assist with the workload.
This sounds crazy on the surface – fire your new employee in five days if they are not a fit. It’s going to increase your turnover rate – unless you don’t include these false starts in your data. You could call these first five days a paid working interview if you have heartburn with high turnover rates. Let’s face the facts, employees are not sticking around no matter what you do. You will see a dramatic decline in real turnover. The new employees that survive the first five days will stay longer and your top performers will be ecstatic that you are giving them productive co-workers who have their back. Set them free in five days and everyone will be glad you did.
Finally, you’ll drastically reduce the number of slackers and people with too many personal obligations in your workforce. This will save you time, money, and headache later. Use this 5-day probationary period in conjunction with the 3-minute screening interview, productive on-boarding, effective evaluations, meaningful & diverse work, and common-sense policies to hire and retain superstar employees. If this sounds daunting, book a free consult with Don to transform your workforce into productive, cohesive, team-players who stay for the long haul, and contribute to innovation and excellence on the job.
WHAT’S NEXT?
Next, book your FREE consultation. You’ll get:
A One-hour one-on-one discovery conversation with Don to uncover your pressing issues.
An opportunity to share other urgent and expensive problems you have. If Don doesn’t know the answer, he’ll put you in touch with a resource that does.
As an employee turnover reduction expert Don will give you an Action Plan following your conversation so you can:
Reevaluate your employee hiring, training, and retention process.
Quickly implement the strategies that work best for you.
Finally SAVE tons of money and time while making your superstar employees productive again.
Don Kermath is the Human Resources, Communications, and Connections expert that empowers hospitality leaders to transform their workforce into productive, cohesive, team-players who stay for the long haul and contribute to innovation and excellence on the job. After meeting with Don and exploring how you are currently trying to improve your organization, you may discover that his highly-customized programs make sense for you (and could really benefit your bottom line). Email Don at Don@DonKermath.com for your own Why You Should Fire Employees in Five Days Action Guide or visit www.DonKermath.com for more information.