How to Rehire an Employee

Learn the ins and outs of how to rehire an employee and ensure you set everyone up for success.
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Employees that return to work for previous organizations are a growing trend as millennials choose to change roles much faster than their predecessors.

There are multiple reasons that an employee may choose to leave an organization, even if they believe they may return in the future. Someone may choose to leave voluntarily to further their career, for a higher salary, or to live abroad. They may be asked to leave because their seasonal contract ended or as part of a company restructure. No matter the case, more and more organizations are open to rehire an employee that previously worked with them, mainly because of the several benefits this might bring:

  • Higher Retention Rates: Rehired employees may have a higher retention rate as they’ve chosen to come back to your organization. The fact that an employee wants to return also emphasizes to current employees that they are working for a great organization.
  • Expedited Onboarding: The onboarding process will be easier and faster as the rehired employee will already be familiar with the company and its processes.
  • Alumni Network / Brand Ambassadors: By rehiring an employee, you demonstrate that your organization invests in great talent. You also increase your talent pool to include all former employees who may return with new skills and experience. 

Policies to Rehire an Employee: What’s Covered

There can also be challenges when you rehire an employee. You can mitigate these challenges by creating a rehire policy to ensure that you have consistency across the organization. This is important if you are rehiring laid-off employees on an annual cycle for seasonal work or if it’s only from time to time.  

  • Why & how did they leave? Do your research into why they left the organization in the first place. Ask their previous manager or the HR professional that supported them. This will give you some insight into the former employee’s experience at the organization. If they left on negative terms, you should proceed with caution. You can use the termination feature of an HRIS system to report why an employee left, which can be used to determine if they should be considered for rehire in the future. This can be helpful when the employees’ prior manager is no longer at the organization. 

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  • Are they eligible for rehire? Employees that left involuntarily are not usually eligible for rehire, unless those reasons were outside of their control, such as a restructure. Employees that are eligible for rehire after termination usually left voluntarily and on positive terms. 
  • Will you honor their previous time spent at the company? This is important as it often impacts the employee’s eligibility for other policies, such as additional paid time off, waiving the health benefits waiting period, and other perks provided to tenured employees. You’ll need to ensure the employee understands how your decision to honor (or not to honor) will impact them. 
  • What will you pay? You’ll need to pay them based on their new role; not based on their previous compensation.
  • Are you recruiting fairly? Follow a solid recruitment process and evaluate the rehire fairly against other candidates to prevent any claims of discrimination. 

The Process to Rehire an Employee

It’s best practice to reissue all of the letters and forms that you send to a new hire. Here are some specific forms that you should consider for the rehire process:

  • The Offer Letter: Provide your rehire with a new offer letter. It should include the latest start date and any special terms. You need to indicate whether their previous time with the company will be considered in their tenure or seniority. You can edit your offer letter template and send it to them for signature through an HRIS platform like GoCo. This makes it easy to keep all the files in one place, even for employees that left and rejoined. 
  • Job Description: You should provide a job description, even if the rehire will return to the same role. The responsibilities and requirements of the role may have changed, so it’s important to set expectations upfront. 
  • Form I-9
    • You can fill out a new Form I-9; or
    • You can fill out Section 3 on the employee’s original I-9 Form. 
    • Has it been more than three years since the rehire’s original hire date? If so, you’ll need to complete a new Form I-9.
    • Has it been less than three years since their original hire date? You’ll need to keep the Form I-9 for three years after the date of rehire or one year from their date of termination (whichever is later). You should keep all these forms in the employee’s file.  GoCo has a free tool for employers to help you collect the I-9 seamlessly. 

  • Form W-4: You need to keep an employee’s Form W-4 for four years after the date of hire. As part of the process to rehire an employee, it’s best practice to have the employee+ fill out a new Form W-4. You should keep both forms on file. It may seem cumbersome to ask your employee to fill out a new W-4, but the process is simple with an HRMS platform like GoCo. You can utilize GoCo’s free tool to collect the W-4. 
  • Onboarding Forms: Your rehire is still a new hire, so it’s essential to send them all of the onboarding documents. They have been away from the organization, so don’t assume that they will remember how to enroll in the health insurance plan or for retirement benefits. Save time with your rehire process by sending these documents through GoCo.

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The Process to Rehire an Employee: Avoid These Common Mistakes

 

  • Work Authorization: Although the employee had work authorization before, it’s important to double-check that it’s still valid. You should ensure that you have the most up-to-date documents on file. 
  • Name Changes: Did your employee change their name before they rejoined? Make sure their employee profiles are linked and their email address and other identification reflect their new name. Check to ensure all other information is up to date as well, including their home address, contact information, etc. 

The process to rehire an employee can have many benefits for your organization, and it can be simple if you know how to do it. By using an HRIS platform like GoCo, you can reduce the burden of completing all of the paperwork again so that you can focus on the rehire’s reintegration. 

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