The Cost of a Bad Hire

Hiring someone in general is a hefty expense, averaging around $240,000. That’s why it’s so damaging when a company hires someone who just isn’t a good fit for their company. Bad hires can be costly—data from a 2016 CareerBuilder survey found that an unsavory hire can cost a company on average $17,000. To top it off, around 75 percent of employers have said that they hired the wrong person.

Employment agency insurance will help to protect a business in the event of a hiring claim, but it won’t protect an agency from all of the costs associated with a bad hire. With numbers like that, it’s important to know exactly what to do in the event of a bad hire and how to prevent bad hires in the future. 

Lack of Patience, Skills, Resources

One of the biggest problems is taking the time and finding the talent for the workplace. While most employers background check the employees coming into their place of employment, more than 28 percent do not. Among those who have had a bad hire, CareerBuilder found that 37 percent of employers found their employees lied about their qualifications.

Another CareerBuilder survey found that workers often lack the skills to effectively interview and hire people properly, with hiring quickly a necessity to fill a void. With all of those factors mixed together, it’s clear that there’s a lack of patience, talent and resources that often end up with a bad hire. As an employment agency, this is where your services can help an overworked company to find the right person.


A bad interview process will ultimately lead to a bad hire. That’s why it’s so important to nip all bad habits in the butt while you can. Having a standardized way to interview others will help your hiring managers with the tools needed to formulate good questions and evaluate candidates. Behavioral interviews and peer-to-peer interviews can help better assess if a candidate is a good fit for your company.


Having an effective branding strategy will help ensure that you have the best candidate possible for your business, making your employment agency insurance worth it. Nearly one in 10 respondents to a CareerBuilder survey said the person they hired did not work out because the company failed to properly convey its culture to the candidate. When companies focus too much on the skills of the candidate, they can often overlook signs that the candidate aligns with the company’s core values.

First Impressions

A strong onboarding process is a long-lasting process, leaving a positive effect on the employee. It’s a sure way to weed out a bad hire. If you give an employee the resources that they need, they will succeed in your company.

About World Wide Specialty Programs

For the last 50 years, World Wide Specialty Programs has dedicated itself to providing the optimal products and solutions for the staffing industry. As the only insurance firm to be an ASA commercial liability partner, we are committed to that partnership and committed to using our knowledge of the industry to provide staffing firms with the best possible coverage. For more information about Staffing Professional Liability Insurance or any other coverage, we have available to protect your staffing business, give us a call at (800) 245-9653 to speak with one of our representatives.