Elevated HR Solutions: Inflated Job Titles

I have blogged in the past about job titles - I've said that they can be a great way to reward employees instead of compensation.  I've also recommended when recruiting for new employees to use job titles that will match the external market (in other words, make it so people will understand what the role is, and then change the title to suit the internal culture).  And now, I have a third comment on job titles - giving an inflated title may be a risk for employers and may be disadvantageous for the employee.

How is it a risk to the employer?

Well - admittedly - the biggest risk is during the termination - and I know what you're thinking: I don't give titles out to employees I'm going to terminate.  Sure...that's usually the thought.  But let's say something happens and you still have to make the decision to terminate.  A higher title means a higher pay-out.  One way around that is having an air-tight employment agreement, but even then, if you aren't providing better than common law you could be in trouble as the employer.  In addition to that, bigger titles also deem bigger responsibilities.  If they aren't ready for the responsibility of a Vice President, Officer or Director that could spell trouble for the employer as well.

How is it a risk for the employee?

As an employee to get a great big title, is nice for the ego.  That said, if you ever want to make the leap to a new company, an inflated title could stop you from getting a position you are actually ready for.  As a recruiter, I've often overlooked people with big titles on resumes because I don't want them to be bored.  In fact, a friend of mine was recently let go and she had a title of Senior Vice President.  There are very few SVP's out there and she would be happy with any management position. She simply changed her title on her resume to say HEAD of and she's been getting a lot more calls.  However, it could still hurt her (why is your LinkedIn Title different than what's on your resume?)

I'm all for great titles and being creative when it comes to developing titles - but be realistic at the same time.  Chiefs, Directors, and Vice Presidents aren't to be taken lightly.  If you're handing them out, make sure you've addressed it in your Employment Agreements at the very least!