How to Hire Your First Employee & Not Regret It

Congratulations! After putting in a lot of time and hard work, you now have your very own business. However, the real challenge has only started. Now, you need to gather the people you need to help you conduct this business.

There may be a lot of job seekers out there who would want to be a part of your organization. However, not all of them would be able to help your business grow. The earliest stage of your business is extremely delicate, so you need the right people to help you thrive.

As a new business owner, there are plenty of factors to consider when hiring your first employees. Your hiring capacity is at the foremost of that. Can you afford to hire an in-house staff, or is outsourcing the wiser choice? No need to worry too much about it, because we have these tried-and-tested tips for you.

The legal preparation

Before you start looking for candidates, you need to fulfill certain legal obligations as an employer. There are legal rules that now apply to you, and you need to make sure that you follow all of them. From tax forms to insurance requirements, you need to set these in order before hiring employees legally.

Here is an overview of the legal preparations you must accomplish:

For the US:

1. Employer identification number (EIN): an EIN is used for tax returns, payroll taxes, and other tax-related or financial documents. You need an EIN to be recognized legally as an employer.
2. Labor department registration: you need to go to your local labor department and register as an employer.
3. Get a worker’s compensation insurance: a worker’s comp coverage is needed to protect workers in case they suffer work-related injuries. However, some areas do not require small businesses to get this insurance.
4. Set up a payroll system: you need a payroll system to withhold taxes for your employees. This includes social security and healthcare coverage.
5. Occupational safety: you need to make sure that your workplace adopts the necessary safety measures.

For Australia:

1. Offer proper wages: make sure that you can offer the proper current award or wage.
2. Guarantee anti-discrimination and equal opportunity: before hiring an employee, your workplace should meet the anti-discrimination and equal opportunity requirements. These are mandated by the Australian Human Rights Commission.
3. Learn your tax obligations: this varies for every business type. Make sure that you understand and adhere to the taxation laws for your business.
4. Get the necessary insurance: you need to get worker’s compensation insurance and business insurance.
5. Work health and safety: implement the necessary measures to provide occupational health and safety in the workplace.

For Countries part of the European Union:

1. Health and safety: you need to ensure that the workplace complies with health and safety standards.
2. Equal opportunities: employers need to guarantee equal treatment, and that all employees are protected against discrimination.
3. Transparent working conditions: make sure that employees are clear about the essential aspects of their work. As such, you need to provide employees with contracts that clearly state their tasks, obligations, working hours, and applicable start and end dates.
4. Working hours: you should comply with the EU’s Working Time Directive. This includes paid leaves, rest days, and not exceeding the maximum working hours per week.

Legal requirements for employers may vary per area. So, you need to research this or ask local authorities.

Set up employee documents

Before hiring anyone, you need to create an employee handbook. The handbook should detail your employee and workplace policies.

You also need to create a file containing the job-related information of your future employees. This would include employee contracts, job applications, performance evaluations, and forms for employee benefits. The file should be stored in a secure and confidential location, accessible only to you and other key staff members.

Develop an efficient hiring process

Of course, you need to have a proper hiring process before you can hire your first employee. It helps you have a clear onboarding flow and lets your candidates know what to expect. Here are some steps to follow when developing your hiring process:

1. Identify the role(s) you need
2. Create the job description(s)
3. Advertise or publicize the position
4. Reach out to ideal candidates
5. Review the applications
6. Schedule an initial screening or phone interview
7. Schedule on-site interviews
8. Assess the applicants using a standardized test
9. Perform a background check and, if applicable, a reference check
10. Identify your top choice
11. Extend an initial job offer
12. Upon acceptance of the job offer, have the applicant file the necessary paperwork
13. Start your onboarding and training process

As a new employer, you may find this a daunting task. There are plenty of processes to learn and requirements to meet before you can develop an efficient hiring process. However, there’s plenty of help you can find. For starters, you can check out this checklist for hiring employees we made for you.

Business process outsourcing can be one of the greatest help you can get. It is just like using the services of an independent contractor. Your outsourcing partner can provide hiring managers to handle your hiring process or virtual assistants who can take care of non-essential tasks, while you focus on your core activities.

Finding and choosing the best candidates

Meeting the legal requirements, setting up the necessary documents, and developing a hiring process are merely preparations. Once you have all of those down pat, it is time to select your very first employee. 

When selecting among a pool of candidates, the strongest advice is to not fully rely on your instincts. It does not matter how menial the job is, or how soon you need to fill the role.

You can avoid a lot of trouble by conducting a strong background check. Check whether an applicant has a criminal past, and test for illegal substances. You may also conduct psychological assessments to screen for unwanted behavior.

You also need to consider the applicant’s potential, and not only their track record. Look for an employee whose values, passions, and interests are aligned with yours. If an applicant has the skills and passions you are looking for, you can easily unlock their potential.

During the interview, applicants also need to demonstrate their aptitude and skills. Ask them to demonstrate how they would handle specific situations related to the job. This can help you ensure that they have a sufficient grasp of their future tasks.

The earliest stages can make or break your business. So, you need a team that you can trust, and can certainly contribute to your growth. It can be overwhelming and tedious to be a first-time employer, but hiring your first employee can be greatly rewarding for yourself, and your business.