When a decision is being made to hire a new employee, I see 4 potential outcomes based on two factors. The first is obviously whether or not to hire the person, and the other is whether or not the person should be hired. A simple diagram of this situation is this:
This discussion however, was all made on the basis of a single person making the decision or equivalently, an entire team being in agreement on the decision. If that is not the case, then it is possible for some people to explore more of the right hand side of the box. I can recall one case where I recommended against hiring an individual, the manager did it anyway and it turned out to be the correct move. Through that, I was able to explore some of the upper right hand corner, although it was just me and not my manager. While it is good, that's one of those situations that can really haunt you, that you would have let someone good get away. I never have claimed to have great insight on hiring, and that case certainly proved it.
[*] It's been my experience that large corporations have a very difficult time getting rid of these people, which is why I called that box a "really bad decision". Even if the person is ultimately let go or leaves on their own, it still is wasted time and effort for all involved.