'Rehiring employees will offer risk and rewards. How should companies navigate a delicate time for all concerned?'
A study recently released by a team of global researchers led by Dr Virginia Stewart of UCD College of Business found that rehired, or boomerang, employees come with a hefty price tag—just over $10,000 more in annual salary —than an equivalent counterpart who stayed at the firm.
“Our research tracked the performance of professional service employees in the US for five years and found that, despite the intuitive appeal of hiring ex-workers known as ‘boomerangs’, these employees returned with a higher salary and did not outperform similar employees who never left the firm,” said Assistant Professor Stewart.
However, it’s not all bad news for organisations.
“Interestingly, we found that rehired employees were more satisfied and committed to the organisation than similar employees who never left,” continued Dr Stewart.
The improved attitudes of ‘boomerangs’ manifested as an increase of 60 annual hours spent on beneficial projects such as recruitment, mentorship, and strategic planning, as opposed to other internal employees who spent on average 160 more hours annually on billable client hours.
The study found that rehires intended to stay with the company for reasons of deeper attachment including teamwork with others, personal connections to senior employees, the sense that their opinions were valued, and that they were recognized for their contributions.
“In our study, almost all of the boomerangs voluntarily left the organization the first time they were hired, so why on earth would they be happier and more deeply invested during their second employment spell and spending time on non-rewarded good citizenship behaviors?” asked Dr Stewart.
Their theory is that the opportunity to reset the relationship under favorable terms is what drives the deeper engagement in rehire.
Our hypothesis is that the act of rejoining gives rehires the opportunity to renegotiate a newer, better psychological contract with their employer. They re-enter with eyes open about the reality of the job and organization, and also an appreciation of the employer’s strengths which is born of external experiences.
‘Stayers’ on the other hand have likely experienced repeated job frustrations without enjoying alternative attractive jobs, experiencing the contrast effect of interim employment, or having an opportunity to push a reset button on the relationship.
So, should you rehire?
Stewart and team say yes, if the employee left voluntarily and you value commitment and engagement as much as performance.
“Boomerang employees offer unique value in the talent pool, representing external employees with internal job experience” says Stewart. “However, if you wish to rehire ex-employees your firm let go, know that you will likely need to work hard to repair and rebuild the relationship and that better performance is not a given.”
In Ireland, the COVID-19 adjusted unemployment rate for January 2021 was 25.0% for all persons, including those on the Pandemic Unemployment Payment. The involuntary and unpredictable interruption of the employment relationship could accompany intense negative emotions that inflict long term damage on the health of the employee employer relationship.
“To avoid feelings of bitterness and frustration in returning employees, employers should acknowledge the harm done, actively work to rebuild the relationship rather than assume things are as they were before, and do so with speed. Re-entry is the time to exceed expectations,” recommends Stewart.
The research, Hello again: Managing talent with boomerang employees, was recently published in the Journal of Human Resource Management and was highlighted in The Wall Street Journal. The study was an international collaboration between Dr Stewart from UCD Smurfit School, and US colleagues Assistant Professor Deirdre Snyder from Providence College, Rhode Island and Assistant Professor Catherine Shea at Carnegie Mellon University in Pennsylvania.
Moving forward, Drs Stewart and Snyder are looking for organizational partners interested in being part of a research project that will explore the impact of team accountability on performance. Organizations interested in a research partnership should contact Assistant Professor Stewart at firstname.lastname@example.org.