Red Flag Companies


There will always be Red Flag Companies just as there will always be Red Flag Customers and Red Flag Employees, Red Flag Relationships and so forth. ‘Red Flag’ meaning not promising.
In the working world, there isn’t much advise on what job seekers should look out for when looking for work for certain companies.  Is it the ideal fit to invest your time and effort?  After all, it’s only fair that the scrutinizing go both ways…right?

So below are some of the questions you should ask yourself as a jobseeker and research as you seek employment although some shortcomings of a company may only present themselves after gaining employment.

  1. Does the company have a high staff turnover? What are the reasons? Companies that have a high employee turn-over are a big Red Flag.  The culture of hiring and firing at will may also be due to deficiencies in management and not just the employees themselves. It is for the following reasons below that employee turn-over may be high.
  1. Is the company making progress financially or is still struggling after 5 or 10 years in the business? Why is this? Some causes of financial instability may be due to poor financial management. In many cases this means constant delays in salaries.
  1. Does the company have set systems in place like job descriptions, company policies and rules and regulation or a business process that acts as a guideline for standard way of doing things? Many a times, in order to save on cash or office space, some companies are unable or unwilling to hire the right staff that requires a certain skills set for certain positions.  In such cases, current employees may find themselves inundated with work, some of which goes beyond their job description.  Going this way can have negative effects on an employee’s ability to perform due to work overload or a low morale caused by performing under-qualified or over-qualified tasks.  This creates an unsuitable work environment ripe for a low employment retention.
  1. Does the company provide official employment contracts and offer letters upon accepting employment to compliment their verbal offer? In other cases, are the terms reasonable or subject to immediate scrutiny by a legal representative?

A case is narrated of an employee who was employed in Industrial Area as the only sales representative for a newly launched cosmetic line for a mid-size company. Upon 3 months of service, work was temporarily halted without the extension of the contract and no reason for suspension or notice was given. After a certain period of time, the sales representative was invited back to work for a further 3 months. At this point, the terms remained the same as the previous 3 months i.e, the salary remained the same, however, the responsibilities did increase.  After the management felt they wanted to retain the Sales Representatives services for longer, a fresh contract was awarded to the Sales Representative for signature.   Being the end of the month, the Sales Representative upon reading the contract, left it unsigned and opted to write a resignation letter.

The problem with the contract being, having already worked for 6 months, the contract made no recognition of previous services and was extending probation period by another 3 months as if the employment was starting afresh with no consideration for a pay increase, commission, devoid of any benefits or a suitable working condition.  This therefore presented a “Modern Day Slavery” vibe leaving this individual with no option but to cut their losses and move on.

Sales Representative jobs are in their nature physically grueling and challenging but can be made attractive with sustainable market rate salaries, perks, commissions and even good working conditions.  The fact that there was only one Sales Representative in the mid-company reporting in a location like Industrial Area where one has to depend on public transport and walk long distances to work in an area which is not easily accessible, all the more made coming to the conclusion of “firing their boss” more easy.


  1. Does the company provide healthy working conditions, psychologically (mutual respect), physically (clean social amenities) and intellectually (are you adding value to your existing skills or applying the skills you had already acquired)?

A lack of respect is one of the reasons a person may opt to leave a job where the employee runs the company like a school rather than realize the people working for him or her are capable adults.  Otherwise why hire them?  Is the employer Emotionally Intelligent or have skills on how to handle his workers in a conflict or high pressure situation or does he or she for instance, come to work to unload his personal frustrations on his employees?

Moreover as mentioned above, refresher training retreats, bonuses to even something as simple as verbal gratitude go along way to retention in employees.

  1. Kind of managerial system – is it a one man show, is there a visible managerial system in place or is the managerial system passive or active? Is the business owner passionate or responsible about running his business or only views it as a cash cow. One-man shows are rather high pressure environments because the ability of the company to pay its workers depends on the workers efforts and the employee standing by his obligation to pay salaries for their work despite his or her other pressing commitments.
  1. Does the company have good customer service and customer relations, do they promise and deliver, over deliver or do they under deliver? Is the employer notorious for causing havoc and putting employees between his clients for over promising and under-delivering then escaping his or her obligations?
  1. Does the pay equal the Job Title and Description? You only have to look at a multitude of Employment opportunities with Major Requirements and Highest Educational Qualifications but with laughable Pay? like this one,


“Business Developer Needed….Must have a Bachelors Degree,…Starting Salary KShs 15,000”

With this and many more challenges being faced in employment, changing careers or starting a business may be an option to avoid repetitive challenges associated with an explosion of Red Flag Companies and the resulting high unemployment rate due to some of these companies shutting down due to inability to sustain a workforce.

In a world where some institutions may be resistant to changing with time and advancement or employee welfare, it pays to always plan ahead and have a back-up plan. Always!

Happy Job hunting..!