story
1) This person is talking directly to clients day one, solo
2) Their code is pushed without review...
3) They are making high-level (C-level, maybe a bit lower) decisions for your business
Otherwise, yeah... a bad employee can do some harm. But, it's that employee's fault, and the other employees will realize this.
It is the business's fault if they go a year under-staffed because "they are afraid."
The second is MUCH more damaging: shows your leadership is not bold, they are misguided, and they don't know what to do to correct course if something goes unplanned (sub-performing employee).