The true cost of a bad hire

The recruitment fee is the least of your worries
When a hire doesn't work out, most businesses focus on the recruitment fee. It's the most visible number - the one on the invoice, the one that stings when you're writing it off.
But the fee is actually the smallest part of what a bad hire costs you.
According to research from the Recruitment & Employment Confederation, a poor hire at a salary of £42,000 can cost a business more than £132,000.
That's not a typo. Three times the salary, gone - and most of it in costs you'll never see itemised on a single document.
So where does it actually go?
The salary you paid while it wasn't working
This is the most obvious one, and still underestimated. From the moment you start to suspect a hire isn't working - and to the moment you do something about it - weeks pass. Often months. You're paying a full salary for someone who is, at best, under-performing and, at worst, actively causing damage.
Most businesses take longer than they should to act, for entirely human reasons. You want to give someone a fair chance. You don't want to have the conversation. You keep hoping it'll turn around. By the time the decision is made, you've often paid six months of salary for work that wasn't being done.
The recruitment fee you paid the first time
If you hired through a traditional agency, you paid 20 - 25% of salary up front. For most mid-level marketing roles, that's between £10,000 and £18,000 - paid in full, often before your new hire had cleared their first week, let alone their probation.
When it doesn't work out, that money doesn't come back. The rebate window will have passed, the small print will have been enforced, and the agency will have moved on to their next placement.
You're not just starting again. You're starting again and you're already thousands of pounds down.
The cost of the people around them
This one rarely makes it onto any spreadsheet, but it's real.
A bad hire doesn't exist in isolation. They affect the people around them - colleagues who pick up the slack, managers who spend disproportionate time on supervision and difficult conversations, teams whose momentum stalls because someone isn't pulling their weight or, worse, is actively creating friction.
Leadership IQ found that 89% of hiring failures come down to attitude, not ability. The person could do the job - they just weren't the right fit. And poor cultural fit doesn't quietly under-perform in a corner. It radiates.
The productivity drag on a team around a bad hire is almost impossible to quantify, which is probably why most businesses never try. But the impact is felt long after the person has left.
The cost of starting again
Once the decision is made, you're back to square one. Another brief. Another search. Another round of screening, interviewing, and waiting. Another few months before your new hire is fully up to speed - Glassdoor estimates it takes around 12 weeks for a new employee to reach full productivity.
If the role was critical - and most senior marketing hires are - that's another quarter of your business running without the person it needed. And if the first search was rushed, or poorly briefed, or left entirely to an agency with no real skin in the game, the conditions that produced the bad hire in the first place haven't changed.
Why it keeps happening
Research consistently shows that most hiring failures aren't skill failures - they're fit failures. The candidate could do the job on paper. They just weren't right for the team, the culture, or the specific demands of the role at that moment.
That kind of failure is almost always traceable back to the brief. Not enough time spent understanding what the business actually needed. A job spec recycled from the last time the role was filled. An interview process that assessed capability but not character.
It's also traceable to incentive structure. A traditional agency gets paid when the hire is made, not when the hire works out. Their commercial interest ends at the point where yours is just beginning.
A different way to think about the risk
At Time to Hire, we split our fee deliberately. Half on appointment - because we've done the work to find and secure the right person. Half at 12 months - because that's when you actually know.
It means we share the risk that every business carries when they hire someone new. If it doesn't work out, you don't pay the second half. No difficult conversations, no chasing rebates, no small print.
But more than that, it means we have every reason to get the brief right, screen properly, and find someone who'll still be delivering a year from now. Not just someone who looks good in an interview.
The recruitment fee is the part of a bad hire that shows up on an invoice. The rest of it is far more expensive - and far more avoidable.