There’s a huge legal change in the UK in terms of recruiting salespeople.
There are a number of changes in the law as of NOW, but the big one for business owners and senior directors to be aware of is the change in the unfair dismissal rules.
Employees who already have at least six months’ service on 1 January 2027 will gain immediate protection under the new rules.
It used to be that employers had up to two years before they had to worry about unfair dismissal claims. That is now being cut all the way down to SIX MONTHS.
What does this mean in practical terms?
Let’s look at a typical small business with just a handful of sales-related folk. So often they’ve realised that the superstar they thought they had hired for a song and had pinned all their revenue hopes on has turned out to be a charlatan. The salesperson is great. Great at being nice, friendly, persuasive, informed. But also great at promising deals that never happen. I have often heard how salespeople don’t cover their costs.
That is a ridiculous state of affairs. The salesperson hasn’t yet, through increased profit, paid for themselves. The company would have been better off not having had the salesperson at all. Natural growth and the unsolicited referrals would have taken them further than having hire the salesperson.
However, let’s be fair for a moment. It takes a while for the salesperson to get used to the clients, market, and the new offering they are now selling. That could be two or three months. And then sales cycles are often seen as being six, even nine months. In other words, it’s not fair to judge the salesperson’s effectiveness until about a year.
Under the old rules, that wasn’t too much of a problem. If the salesperson clearly isn’t paying their way after 12 months or so, there’s a good chance they need to be eased out of the business. I do mean “eased out.” Business owners typically hate having to fire their nice salespeople and just hope they’ll go away soon as the salesperson realises they aren’t earning any commission. However, if the salesperson didn’t get the hint, then, with a deep breath, the senior team would fire the salesperson and they would be no concern about the ex-employee making a fuss. No excuse was needed. The salesperson just had to leave, preferably immediately.
Under the new rules, all that has changed.
If the employer doesn’t fire the salesperson within six months, then the employee has every right to demand an explanation. Considering the (fictious?) pipeline they have been building up and the long sales cycle, how can the bosses be firing them? There must be a reason other than they can’t do the job. Suddenly the company has an unfair dismissal claim on their hands. Which means a lot of small businesses are going to hang on to terrible salespeople even longer. They will not want to get into the argument.
What are the dangers of having a poor salesperson?
Not only are they likely to be costing more than they bring in, but they are also probably damaging potential business. Prospective clients who should have done business will be frightened off and never come back. Reputation in a close-knit niche can be irrevocably ruined. To be blunt a poor salesperson can shut their boss’s business.
The ways to avoid this horrific scenario under the new rules can only be either don’t hire salespeople (which might well be the right answer under any rules) or “hire slow, fire fast”.
If you know what to look out for, you can tell if the salesperson is any good withing a few weeks. You won’t be looking out for results at that stage, but you can judge behaviour and attitude.
This leads on to a whole raft of issues. You should be tracking and keeping them accountable to their agreed behaviour targets in any case. This new regime just makes that way more important. If you have documented evidence of missed behaviour targets you will be far less likely to have an argument with your ex-employee if you do stray over the six months barrier. And you will know way in advance of six months whether they will work out.
However, this assumes senior management know what those behaviour targets should be and they know how to hold their people accountable to them. It also assumes that the salesperson’s boss knows how to coach them and does so regularly.
Under the topic of “hire slow” it makes zero sense not to have them do a psychometric assessment. They are inexpensive in comparison with the expensive mayhem if they’re not good enough.
Under “fire fast”, be aware that this salesperson might have interviewed well, might have a glowing assessment and past record, but until they are sitting in your office nobody will know if they can definitely perform. What was the reason for their stellar figures before? What is the market, the offering, the work environment, the geography, the team members around them, a boss who knew how to get the best out of them? It might be the salesperson is good. Just not good in your team, right now. It’s nobody’s fault they have landed with you, everybody did everything in the hiring in good faith. However, it is your fault, for good or ill, if you hang on to them.
In summary
- Think twice about hiring salespeople.
- Have a cast-iron hiring procedure, including psychometric assessment.
- Have clear behaviour targets.
- Keep them accountable to those targets, particularly in the first few weeks.
- Coach them
- Don’t hang on to a poor salesperson; have the courage to fire them within 6 months.
If you want to get good at doing all these things, contact your local Sandler trainer. We help our clients hire and develop the right salespeople.