BoomerangThe practice of ‘boomeranging’ — or rehiring employees that used to work for you — is on the rise — but is it actually a good idea?

I’d say yes, it is: boomeranging an employee can end up being better for you than starting fresh.

Rehiring Saves Money

Letting someone go is expensive. Between all the exit paperwork, potential severance pay, and having to train a new employee, laying off an employee making less than $50,000 a year can cost up to one-fifth of that employee’s current salary. It’s a cost that all employers would love to avoid, but layoffs are just how business works.

The good news is that rehiring someone can cut down on those costs. Anne Berkowitch, CEO of SelectMinds, estimates that you can save up to $20,000 per rehired employee, depending on salary. Because rehired employees already know what they’re doing, rehiring cuts down on training costs and decreases the time it takes for “new” employees to be fully productive within the organization.

“The alum knows the company,” Berkowitch told Inc. “The company knows the alum, so the hiring decision is made with a lot more information than what is captured on a resume.”

Rehiring is certainly less of a risk than going with a brand new hire. New faces can be tempting, but taking a chance on a new hire when you can hire someone who has already worked for your company can cost you. How much, exactly? The U.S. Department of Labor reports that it could cost up to 30 percent of a bad hire’s first year earnings. If you’re looking to hire in the $50,000 range, a bad apple can cost you $15,000.

Making the Call

There are a lot of key points to consider when rehiring: if an employee left before, will they leave again? Did they perform well when they were here, or were they coasting and unproductive? These evaluations must be made on case-by-case basis, and it can be difficult to make the right call.

Here are a few things you may not have thought of when considering the pros and cons of rehiring someone, from Beth N. Carvin, president and CEO of Nobscot:

  • “[The potential rehire has] learned that the grass is not greener elsewhere, so they become more content than those who wonder if life is better at another company.”
  • “Rather than being a flight risk, these ‘rebound’ employees have proven to be more committed to the organization the second time around.”
  • “They come back to a network within the company that provides a welcome return and additional support on the job.”

Ultimately, the choice to rehire depends on the employee in question, but there’s little reason to fear hiring someone who has left your organization before. They’re better-trained, save you money both now and later, have most likely learned a few things while they were away, and come back with a better sense of what they’re getting into, meaning they’re less likely to leave again. So if you’re looking to gain back some of the productivity you shed during a layoff, there are few candidates better than those who have already proven themselves.



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