5 Tips To Hiring Your First Employee

You’re past the big hurdle: getting your business legal, operational, ready to go. Some might say, though, as opinion, that this next step is probably a larger hurdle — getting to hire your first employee to be on the payroll.

It’s an interesting time in your corporate professional life — a time bomb that can blow up in your face or simply sit there like a dud for you to laugh at. You’d be laughing at it as a sign that you’ll always be one step ahead of the game, practicing prestige and reputation for anyone who walks through your door to either do business with you or work for you.

The question is this: when do you need to start hiring and how do you do it?

Are You Struggling to Keep Up With Your Operations?

If you find yourself pulling your hair out when it comes to accounting, invoicing, customer service calls, sales, everything — chances are you need to hire your first employee, someone who can maybe intern for those duties you’re starting to not have the time or energy to devote.

You specifically will see detailed cues, telling you that you need another person other than yourself on the payroll. Take for instance the possibility that you might lose business by not answering calls fast enough. If business is booming, ultimately you might lose some sales by the simple fact that you can’t address them fast enough. You, therefore, hire an administrative assistant to basically answer the phone.

Cost Versus Reward — Determine the Balance

Consult with a qualified business attorney on this, and you should be squared away. The National Federation of Independent Business (NFIB), in fact, details the necessity to review cost versus reward. In other words, how much would it cost for you to shoulder an employee on the payroll, and how much business gain would you receive for the extra operational efficiency, capacity or reputation? If the reward is greater, you may be looking at a good venture to hire your first employer. If the cost is still too much, though, hold off on it.

Consider the Hiring Process Very Carefully

You might think that the procedure is nothing more than posting an ad in the paper and taking walk-ins. Not so. The law has, in fact, provided multiple tiers of legal specifications for properly following protocol when conducting a hiring process. The SBA (Small Business Association), of course, outlines a pretty clear checklist of what you need to do when dealing with the hiring process:

  • The Employer Identification Number (You Need This)
  • Tax Withholdings are Paramount
  • Employee Eligibility Verification (Immigration Law Is Crucial!)
  • State Directory Registration
  • Posting of Required Notices

This is just a few of the more important aspects of the hiring process. Research more. You’ll thank yourself later when facing an interview on the other side of the table.

Prepare Yourself for a Changing Work Environment

It’s almost like having a child. Take a marriage, for example. Before, it was just you and your spouse. It generally wasn’t as ‘complex’ as one would think. When a kid, however, enters the mix, suddenly we’re looking at major uncharted territory.

As an owner of your company, that’s not all too dissimilar. You’re not just an owner; you’re now a boss since you have an employee working under you. Be prepared to delegate and direct. Definitely be sure to set some time aside for training purposes. You’re not alone anymore.

Of Course, Keep a Close Eye on Any Legal Issues With Employment Law

You’re basically held under close scrutiny. Don’t get careless. This is especially the case when hiring your first employee. You have to painstakingly review all these factors to ensure you’re jumping through all the legal hoops:

  • Consent for Background Checks — Believe it or not, but a candidate can cry foul on this one, getting you in major legal trouble.
  • Setting Up the Tax Status — It goes without saying. You’re a business owner. Pay your taxes. If you don’t, you face consequences.
  • Nail Down Employment Status to the Wall — That means accurately verifying, classifying, recording, copying, saving, keeping and breathing every piece of information about your employee(s).
  • Watch the Questions You Ask During the Interview — The law is very particular. You can’t ask questions about age, sexual orientation, race or just about anything else that has literally nothing to do with the job at hand. Any of those questions can be considered discrimination.
  • Do You Need Disability Insurance? — That’s a valid question to ask yourself, actually.
  • What About Benefits? — Recognize the most recent laws about, for instance, the Affordable Care Act, and you’ll have a pretty good idea about what you may need to do about benefits for your first employee (and future associates as well).

You might have difficulty answering some of these questions, though. That’s when you consult with a skilled lawyer or legal professional. Get the help you need.

It’s the Livelihood of Your Business

Every step is crucial. Take the necessary precautions, checks, reviews and assistance you can get. Initially, this was your marriage. Now you have a responsibility — your first employee. Make that employee work well for him or her and yourself. The rest will be history.

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Matt is the co-founder and CEO at UpCounsel, the easiest way for businesses to get amazing legal services. You can get more of his business tips on Twitter @UpCounsel.

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