Rehiring: Back to the ex – is it worth it?
Reading time: 6 min
Employees come and go – and maybe again at some point. It becomes really painful for companies when they lose an employee they would have liked to keep. Once the decision has been made, it is difficult to change. Nevertheless, companies or HR staff can do something to ensure that the valued employee returns at some point, with so-called “rehiring”. In his article, our HXM expert Aman Singh Jhinjer explains what opportunities rehiring offers for companies, what measures can be taken and when it is better to stay away from it.
Content
- What is rehiring and why is it relevant?
- Opportunities and risks of rehiring
- Measures for successful rehiring and what you should bear in mind
- When should you stay away from rehiring?
- Conclusion
The effects of demographic change are more acute than ever. Whereas in the past there was still talk of an employer market, today there is no doubt that it has developed into an employee market. In times of a tightening labor market, there is an extreme demand for suitable personnel.
Creative measures must therefore be considered in order to gain a competitive advantage here. One such method could be rehiring or boomerang hiring.
1. what is rehiring and why is it relevant?
Rehiring, also known as boomerang hiring, is the rehiring of former employees who have previously left the company. The reasons for leaving the company can be very different.
According to a study by Visier Insights, which has access to data on 15 million people in employment, the desire to explore something new as well as the perception of insufficient development / career opportunities and an unfair salary were decisive factors for quitting.
However, the leavers were not necessarily happier after the change, as it is not always possible to meet the expectations of the new employer. For example, a lack of support during onboarding, non-compliance with employer benefits or conflicts within the company or team due to a so-called value mismatch are reasons to indulge in nostalgia for the old employer.
This is also shown by the Königstein Group study: 43% of the approximately 1000 respondents of all ages could imagine returning to their former employer. Nevertheless, only 5% of the study participants actually returned to their former employer. As a result, this potential is still underutilized by companies in most cases, even though rehiring has a number of advantages beyond filling vacancies.
2. opportunities and risks of rehiring
Opportunities for rehiring former employees lie primarily in past collaboration. We regularly sensitize our customers to this when the focus is on employee recruitment and retention.
Specifically, we point out to companies that they are not “buying a pig in a poke”. There is already an awareness of the skills and deficits, which results in realistic expectations. The same applies to the employee. This person is already familiar with the company, its processes and culture. This results in the following advantages:
- Faster integration of the employee(s)
- Shortened onboarding and training sessions
- Lower (recruitment) costs for the company
Faster integration into the company and into the position can prove to be very helpful, especially in the event of staff shortages. It is precisely in this case that we recommend considering so-called “boomerang employees”. This enables acute staff shortages to be eliminated efficiently and effectively. In the best-case scenario, “boomerang employees” even bring valuable institutional knowledge and experience from their interim station back to the company, which can give them a competitive advantage.
As with opportunities, risks lie in the shared past of employer and employee. There were reasons why the employee left the company. There is a possibility that earlier conflicts or dissatisfaction still exist latently, which could be triggered by the slightest impulse. In addition, according to Ruth Stock-Homburg, Professor of Marketing and Human Resources Management at the Technical University of Darmstadt, staff turnover is higher among rehires than among employees who have remained with the company.
On average, returnees receive 25% more salary, although they do not perform better than before(Arnold et al., 2020; Visier Insights, 2023). This could make the existing workforce feel disadvantaged, increasing the potential for conflict.
The impression could be created that the only way to obtain better conditions for the same service is to rehire the employee. This can lead to imitation effects among existing employees.
3. measures for successful rehiring and what you should bear in mind
The process of rehiring begins with the offboarding of the employee. The exit interview plays a central role here. In impulse workshops, we point out to companies that care must be taken to give the leaver the feeling that they regret the decision, but that they can also show understanding for it. Under no circumstances should accusations be made or a guilty conscience evoked so that the exit interview is remembered by the person concerned as a positive event. The person should leave your company with the feeling that they are welcome and can always return.
“Out of sight, out of mind” – this proverb makes it clear that good offboarding is not enough. We emphasize that it is at least equally important to maintain contact. To this end, it makes sense to include graduates in an alumni program if they wish to do so.
Further opportunities arise, for example, through channels such as LinkedIn, XING and newsletters to maintain an emotional connection, keep ex-employees up to date and make them feel like they are still part of the company. Friendships that have developed from the former working relationship with existing employees can also be used as an opportunity. However, this requires inward-looking, open communication.
To maintain contact, we recommend that our workshop participants also focus on “small” gifts, as these can be very effective despite low costs and minimal effort. This includes sending out invitations to the next summer party, the next Christmas party or similar internal company events. A postcard or Christmas card signed by the entire former team can also evoke positive emotions and nostalgia in the recipient.
However, these measures must be initiated directly with or after offboarding, because: The longer employees stay away from the company, the less likely they are to return. In its study, Visier Insights (2023) came to the conclusion that the critical time frame for rehiring is 13 months. From 16 months, the probability of a return decreases rapidly.
4 When should you stay away from rehiring?
According to Stock-Homburg, one of the strongest motivations for changing employers is and remains salary. Accordingly, returnees generally expect a new basis for negotiation. If there is no willingness on the part of the company or at least no possibility – as the budget for this is not available – we advise against a re-employment process.
If no improved salary is offered, the ex-employee is very likely to abandon the process. The promise of a higher salary despite budget constraints could lead to irritation and perceived injustice within the workforce. The same applies to the career and development opportunities on offer.
We also advise against rehiring if the entire team votes against rehiring the ex-employee(s). Conflicts would be pre-programmed and unavoidable, which could lead to further termination of the re-hired employee(s).
The open and transparent exchange between employers and former employees should not be underestimated. Before the re-employment process is initiated, we recommend that you work through the reasons for leaving the company together. It must then be checked whether the triggers for the dissatisfaction on the part of the ex-employee(s) have been eliminated or still prevail. If the latter is the case, rehiring is highly likely to be unsuccessful.
5. conclusion
Rehiring or boomerang hiring is all the rage. This is mainly due to the fact that companies are having to rethink due to labor market conditions and the general shortage of employees.
Nevertheless, the following applies: rehiring should not be used indiscriminately and thoughtlessly, as there is a potential risk of renewed fluctuation or even a deterioration in the working atmosphere in the team/company. Rehiring can actively counteract staff shortages, but hasty rehiring out of necessity can prove to be a boomerang.
Thanks to our professional expertise and experience, a rebound effect can be avoided preventively so that the benefits of rehiring outweigh the disadvantages and the reemployment of former employees can be successfully implemented.
To this end, we offer workshops on the topic of employee recruitment and retention, in which we convey relevant aspects of rehiring and present further solutions.
Would you like to win back talent in the future or not lose it to your competitors in the first place?
