Most people do their jobs well, but there are some who can’t or won’t do their jobs adequately. The most obvious consequence of keeping bad employees is that paying them is a waste. But there are follow on effects that are much more serious. In the private sector, these problems tend to take care of themselves, but not so in the public sector.
There are many problems that come from allowing bad employees to stay in an organization:
1. They cost money but don’t produce their share of output.
2. They take up the time of other employees.
3. Some talented employees will become disgusted with having to work with incompetent employees and will leave.
4. Over time some bad employees will move up in management where they can cause more damage with poor leadership and bad hiring decisions.
5. An organization that goes too long without culling bad employees will eventually lose its ability to distinguish between weak and strong performers.
Of all these problems, only the first one (not producing enough output) has much of a hope of ever being measured. But the other four problems have a significant multiplying effect that is very difficult to measure.
Most companies in the private sector do a reasonable job of culling bad employees. The ones that fail at this important task increase their risk of failing entirely. So, one way or another, the problem of bad employees tends to be kept under control. It’s not that the private sector employees are all star performer, but the proportion of poor employees tends to stay under control.
It’s worth noting that a person is rarely inherently a bad employee. It matters a great deal what job they’re expected to do. There are some jobs I’m terrible at, and others I’m good at. The process of culling poor employees is in some sense a force that shuffles people out of jobs not suitable for them and into jobs they’re better at.
This reshuffling of people to different jobs sometimes happens within an organization and sometimes it involves getting fired and looking for a new job. It’s tempting to eliminate firing altogether and say that companies should always find a better fit for each employee. However, without the threat of getting fired, some employees will see no reason to ever really try. Some bad employees can’t do their jobs, but others just won’t do their jobs without the threat of being fired for poor performance.
In the public sector, firing employees is much less common than it is in the private sector. This leads to some very simple logic. Some hiring decisions are mistakes. If you don’t get rid of poor employees, they accumulate. This leads to the five problems listed earlier.
According to Statistic Canada, in 2011 there were 3.6 million public sector employees paid a total of $194 billion. If we conservatively estimate that 10% of these wages are wasted on bad employees, that’s $19 billion per year wasted. Of course, bad employees pay taxes, so let’s call the net waste $12 billion per year.
According to CRA, in 2012 the 9.5 million Canadians earning less than $20,000 per year paid a total of $1 billion in federal and provincial income taxes. So, cutting public sector waste would allow us to stop taxing people with incomes under $20,000 and we’d still have $11 billion left over. Just think of how much we could shorten wait times for medical scans and procedures.
Some readers will take this article as an attack on public employees and the services they perform for Canadians. This is not an attack on Canada’s public service. Our public service is vital. We need safe food and medical care just to pick two important functions. We need the millions of public servants who do their jobs well. What we don’t need is to pay the ones who can’t or won’t do their jobs. Many strong public servants would be thrilled to see their useless coworkers leave.
Don’t be fooled into treating public sector employees as a uniform group. There are good teachers and bad teachers. The good teachers are worth every penny we pay them and the bad teachers do damage to our pocketbooks and our children’s future. It’s not realistic to expect to eliminate all bad employees, but it would be great to deal with the most obvious cases of poor performance.