When an "overqualified" candidate applies for an open role at your company, there are only four reasons for you not to consider this person for the available position.
1. You can't afford them.
If the person's last title was something senior like "Chief Marketing Officer" and they're applying for anything that would be considered a more junior-level role in your company, your first thought might very well be, "I can't afford this person!"
And maybe you can't.
But money isn't the only motivating factor for people, and it's rarely the most important.
What if the person is truly passionate about your industry (or better yet, your specific company) and more than willing to take a step (or two, or three) backwards in title and compensation so they can do something they love?
What if the person loves to learn, and the idea of using their established skills to join your company (perhaps in an industry in which they haven't previously worked) is especially appealing to them?
What if the candidate would be perfectly satisfied with the compensation package you can offer because the person's last title was "start-up inflated" and the base salary was low in exchange for (potentially lucrative) stock options that didn't pan out?
What if the candidate is financially secure (perhaps part of a dual-income household where the partner earns more than enough to pay the household bills), and is interested in the position for the growth opportunities it offers, not the paycheck?
You'll never know whether or not you can actually afford a candidate if you don't ask, and you can't ask if you discard their application based on your unfounded assumptions about how much money would be needed to secure someone who's "overqualified" for the role.
Instead, why not schedule a phone call with the candidate? Thank them for their obvious interest in the position, proactively express the compensation range targeted for this role, and ask if it meets their requirements... then give them an opportunity to answer your question. Arranging and having this call might take all of fifteen minutes, which is the only thing you have to lose if it turns out the talent is really outside of your reach. But think of everything you have to gain if your compensation assumptions were incorrect and you can afford to bring this "overqualified" candidate onboard... that's worth fifteen minutes, right?
2. You can't manage them.
Let's be honest: "overqualified" is often just a code word for "older" (whether you mean to actively age discriminate or not), and not every "young manager" has the leadership skills needed to manage team members with more experience. If the situation involves a more junior hiring manager, you might worry they won't have the training, temperament, or experience needed to effectively manage an "overqualified" candidate.
That may be a valid concern based on the strengths of your team and the attitude of your over-qualified candidate... but it's not a given.
Humble, self-aware candidates who want to use their experience to help a company grow shouldn't be dismissed without a conversation to understand their motivations.
Plus, many people fail to remember that hiring an overqualified candidate is an opportunity not only for them to contribute to your team, but also for them to help develop it in the form of mentoring less experienced employees. Why wouldn't you want that?
3. You can't keep them.
It's certainly possible an overqualified candidate who's applying to your company was caught up in a restructure from their last role, and they're applying to your open role because they really want (or really need) to get back to work. If this is the case, you might be worried about losing them should a better opportunity comes along.
That's a fair concern.
But consider these three points:
If the candidate is overqualified, they'll likely be able to contribute to your organization much faster than a candidate who isn't. So if a candidate gets up to speed quickly, contributes their significant experience to your organization, and then leaves after a year (or even six months)... what have you really lost? Sure, you have to go through the hiring process again, and that's not ideal, but the different perspective an overqualified candidate could have contributed to your company during their brief time there is likely to more than compensate for that.
If a candidate is overqualified, it's certainly possible the job for which they're applying won't be challenging for them... but what if they understand this, and that's part of the appeal? I know someone who's been rejected at least twice in the past year for roles he could do easily based on his experience. The reason he applied for these "easy" roles? They each offered a stable income with attractive organizations, and he was excited about being able to complete the job exceptionally well in just 35 hours a week... because that would mean extra time for him to spend on his young family, his artistic endeavours, and his (non-competitive) side-hustles.
If a candidate is overqualified for the role, and you don't have an environment where top talent is continually being given opportunities to develop and grow beyond their current role... is hiring an overqualified candidate really your biggest concern?
And again, there's really no way of knowing the motivation of an overqualified candidate if you discard their application based on your assumptions. Schedule a call!
4. You're afraid of them.
Of all the reasons to overlook an overqualified candidate, this one is the most problematic.
And also the worst.
Great leaders hire the very best people they can find. Period.
Apple founder Steve Jobs famously said, "It doesn't make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do."
Amazon founder Jeff Bezos as instructed his hiring mangers to consider three critical measures before making a hire:
Will you admire this person?
Will this person raise the average level of effectiveness of the group they're entering?
Along what dimensions might this person be a superstar?
Both Apple and Amazon strive to hire the very best talent possible for every position in order to continuously make their companies better. Does that mean sometimes managers will end up hiring candidates who are smarter and more experienced than they are? Well, I haven't worked for either organization, but I think it's a safe bet the answer to that question is "absolutely"; I imagine at both organizations the "fear of looking bad because my employee is smarter than I am" is greatly overshadowed by the "fear of hiring weak team members so I can look better by comparison."
On a related note, Apple and Amazon are worth $2.3 and $1.8 trillion dollars, respectively... do you think that might have anything to do with their talent philosophy? I do.
If you've done a good job in writing an honest and transparent job description (ideally including a compensation range, so there's no mistake about what level you're seeking), and an "overqualified" candidate takes the time to apply, what good reason would there be not to schedule a call and learn more about why they're interested?
If you've read up until this point, you already know the answer: there isn't one.
When an "overqualified" candidate applies for an open role at your company, there are only four reasons for you not to consider this person for the available position:
You can't afford them;
You can't manage them;
You can't keep them;
You're afraid of them.
None of these reasons are very good.
And all of them say more about you than they do about the candidate.