Congratulations! You’re building a business and need additional help to expand your successful enterprise. Now it’s time to hire your first employee.
Here you will find the four things you should consider before hiring your first employee. These tips will further prepare you and your business for success.
1. Review Your Finances
Knowing that you need more help in your business and being able to afford such help are two different situations. Before you go out and hire a new employee, it’s important to evaluate whether you can cover all the expenses that a new employee entails.
Among the important aspects to consider is whether you can afford the taxes associated with hiring a new employee. Additionally, it’s important to consider if you will be contributing to your employee’s health insurance or 401K plans.
Some estimates put the cost of hiring a new employee at $4,000, just for the upfront costs. The Bureau of Labor Statistics further estimates that the additional benefits provided for an employee who makes $50,000/year would be $14,950/year.
2. Have Your Paperwork in Order
Now that you’ve assessed whether or not you can afford the extra help, what kind of paperwork do you need to fill out and submit? As an established business, you should already have your EIN (Employer Identification Number).
This number will be essential when you set up your employee’s information. The information you will be setting up for your new hire will include tax-related paperwork, including their federal income tax withholding, federal wage and tax statement (including the employee’s W-2), and state taxes.
Additional paperwork that helps ensure a smooth transition with your potential employee is information and approval for a background check and a Form I-9 (which ascertains whether they can work in the United States).
When you have moved forward with your new hire, it’s also important to report your new employee to the Small Business istration (SBA).
3. How to Protect Your Business
Now that you’ve hired a new employee, it’s vital that both parties are protected. The most important way that you can do this is by purchasing workers’ compensation insurance. Workers’ compensation is no-fault liability insurance that helps protect the employer from unforeseen injury to their employee and any accompanying costs associated with the injury.
Subsequently, this insurance also helps to protect the employee and provides them with help and coverage if/when an accident or injury does occur.
4. How to Find a Qualified Candidate
Now that you know the essentials of what you will need to do before hiring a new employee and how to protect yourself and your business once you do, it’s time to start looking. Living in the digital age, there is no limit to your ability to find a qualified candidate online.
That being said, sometimes looking closer to home and getting a referral can be just as valuable. Depending on what kind of business you have, perhaps the avid customer would love a chance to work in the amazing environment you are creating.
Whatever your choice, there’s an abundance of qualified candidates in the marketplace. As you build your business, that the atmosphere and environment you are creating will be influenced by who you hire.
Look for someone who embodies your business’s values. When you do this, you are sure to find a dedicated individual who meets your needs and helps you continue to grow.