The Worst Team Nightmare Come True
With the right people on board, your team can be one of your greatest advantages in business. And it’s super important to get mentoring around team hiring, development and management. Mistakes in this area can be incredibly costly. If you’re not careful, the wrong team member may become a giant liability to your business.
I learned this the hard way in 2012. I hired a friend without having the clarity or screening process to assess if she was the right fit for my team. I assumed she was an expert in customer service (because she said she was) and thought she could help me improve this department as my company skyrocketed beyond 7-figures.
After hiring this friend, I quickly realized she had many challenges with productivity and focus. She was constantly overwhelmed and unable to do her job efficiently. She did provide caring customer service and seemed willing to improve, so I kept giving her the benefit of the doubt. Because she was my friend, I was reluctant to “rock the boat” with her and overlooked too many errors in her performance.
This is the danger of hiring friends - it can be difficult to show up powerfully as their leaders. I tried to help her get organized. I even hired a coach to work with her. Her behavior patterns didn’t change. Her attitude went south. Months went by, and I kept hoping she would change for the better. It’s fine to want to nurture growth in your team members, as long as they have positive behavior patterns and show up with a consistently great attitude.
That means they take responsibility, they own their mistakes without blaming anyone or anything else, they don’t repeat mistakes, they’re honest and accountable, and they take the initiative to learn and improve their performance. You should NOT feel like you’re constantly coaching and babysitting your team.
They shouldn’t be a drain on your energy because if they are - they’re either not in the right role or they’re not a fit for your company.
You need to channel your coaching and mentoring energy for your clients - your team needs to support your energy and free you to have a greater capacity to serve. If someone on your team is dragging you down, hijacking your time, or hurting your business performance, you need to make tough decisions immediately.
Don’t wait months hoping things will magically turn around. What I did is a classic example of wishful thinking that soured my relationship with that team member. People with deep-rooted attitude problems, who are prone to blaming others and avoiding responsibility, are likely going to start making YOU wrong for their poor performance. You are playing a very risky game by keeping these people on your team.
Letting them go after months of problems can be even more difficult (and costly). When I finally let this woman go, she made a big stink and acted like I had wronged her. She expected a big payout even though she was part-time and wasn’t technically an employee (she was an independent contractor who had other companies as clients in addition to mine). I got a letter from her attorney demanding $25,000 for no reason. I balked at this and refused to pay, as I didn’t owe her anything. Unfortunately, I didn’t understand my vulnerability as an employer in California. The system here is incredibly biased in favor of employees.
The legal distinction between independent contractor and employee is very fuzzy and open to interpretation. Many entrepreneurs aren’t aware of this and unknowingly hire independent contractors who should be classified as employees. So this woman filed a complaint against me with the labor commission stating she should have been an employee. She made false claims to overtime pay (which she never worked) and never provided any accurate evidence. My biggest mistake was contesting her complaint. It was a losing battle because no matter how good my defense, no matter how erroneous her claims, the government was biased towards her.
This woman’s attorney LEFT her halfway through the case and even though was representing herself poorly, she still won. After a yearlong legal battle that cost me over $50,000 in attorney fees, I got ordered to pay my former team member $50,000 – TWICE as much as she was originally asking for. It was my worst experience as a business owner. It felt so unfair. Luckily, I had the money to pay her and was able to move on and create far more success. I took it as a learning experience. I will never make the same mistakes again!
Here are my top 5 takeaways…
1. Get legal advice to make sure your team members are appropriately classified as employees or independent contractors. Don’t ignore this – it could bite you in the butt big time if you get it wrong.
2. Be extremely cautious when hiring close personal friends – in most cases I recommend avoiding this. It’s easier to be an effective leader when you aren’t trying to protect a friendship with a team member.
3. When you see consistent attitude and behavior problems with a team member that don’t turn around quickly, it’s time to let them go swiftly. Those types of challenges are not fixable by you.
4. Don’t be afraid to fire people because you’re concerned about the transition. The longer a bad-fit person is on your team, the more likely they are to cause even bigger problems. Make the decision without delay. Trust that you’ll get through the transition and the right replacement will come in.
5. If you’re in a sticky spot with a former team member who’s demanding a payout, consider negotiating with them instead of refusing outright. Even if they’re undeserving, fighting a legal battle with them could be FAR more costly – in terms of time, money and peace of mind. You are much better off trying to find a compromise with them and give them enough money to send them away peacefully.
Hopefully my learning can help you avoid this painful experience. And remember, as long as you’re empowered to grow with the right people, your team can be your greatest advantage. I offer private mentoring around team development and leveraged business building strategies to help you grow with greater impact, profits and freedom. See more here.
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