“Time spent on hiring is time well spent.” – Robert Half
The economic conditions in the country are getting better, unemployment is going down and more companies, big and small, are hiring. Some small business are growing and they can hardly keep up with the pace and some of these small business owners believe they are ready to hire and they want to do it as soon as possible. However, as small business owner you may need to think this through. Getting your first employee may not be as easy as you think.
- Have you analyzed your business trends? Is this a temporary peak? Is this more of a permanent growth? Can you rearrange schedules, deliveries, so you can still maintain an efficient and cost effective operation? Check your last couple of years of sales records. Can you afford to pay someone’s salary? What is your workforce need? Do you need a part time position? Full time? Where do you need help? Can this be solved with technology? All these questions may help you to decide whether or not you are ready to hire a person.
- Do you need an employee? Can this need be done with a contractor? Deciding whether or not you need an employee or not is not easy. Remember the differences between and employee and independent contractor. Keep it clean! These are the basics: with the employee you have the right to direct and control the manner and means by which the work is performed; you instruct or supervise the person while he or she is working, you can fire or the employee can quit at any time; the work being performed part of your regular business; and you furnish the tools, equipment, or supplies used to perform the work.
- Hiring your first employee may not be cheap; you need to remember all the basic compliance elements that come with this action. You need to have insurances, such as workers’ compensation, State Disability Insurance (SDI/CASDI), Unemployment Insurance, Health Insurance (based on the Affordable Care Act or ACA); starting July 1st, 2015 in California you will need to provide your employees with paid sick leave. Also, you would need to determine if you are going to provide vacation or not. You need to take all these issues in consideration. Do your math!
Hiring your first employee is a very exciting moment! It shows you that your company is growing and you need help; do not forget all the responsibilities that go along with this major step in your company. It is better wait a little longer and do your homework rather than do something half haphazardly and have to let you your first employee due to lack of planning. Small business owner, you are doing a great job! Keep it up!
