The decision to hire your first employee should not be taken lightly. This six-step process will help you make smart decisions about how and when to staff your business:
Step One: Evaluate Your Needs
Take a look at your business to determine which tasks are overwhelming you. Are simple, administrative tasks keeping you from pursuing money-making activities? Do you need a specialist to help you with something that’s outside of your realm of expertise?
Once you determine your needs, develop a written job description. If you only have one employee, he/she may have to pinch-hit in several different areas. Make sure that the job description accurately reflects your expectations.
Step Two: Evaluate Your Capacity
Hiring an employee will increase your responsibilities and place new demands on your time. It takes hard work and commitment to give a good employee the guidance, support and encouragement they need to be successful. It is even more difficult to discipline and fire a troublesome employee. Are you ready?
Employees need more than just paychecks—they’ll need training, guidance, equipment, tools, and space to work. Can your business afford to provide everything your employee will need to be effective? Is there adequate space for a new employee to work? If you work at home, do local zoning ordinances prohibit employees in your home?
Step Three: Weigh Your Options
- Adding person power to your business doesn’t have to mean hiring a full-time employee. Consider the following alternatives:
Ease into an employment relationship by hiring someone on a part-time basis. This way, you’ll be able to determine how much help you really need and how much payroll expense you can afford.
- Hire someone on a temporary basis through a staffing agency. This arrangement will enable you to “try out” a potential employee before you commit.
- Use the services of an independent contractor on a per project basis. This type of arrangement is ideal if your business consists of big projects with downtime in-between.
- If meeting the needs of a customer requires activities outside of your area of expertise, consider subcontracting that portion of the work to another business.
- College internships can be a rewarding way to meet your staffing needs. An intern will work for your business in return for college credit and a small stipend.
Step Four: Check Into Legalities and Liabilities
An ounce of prevention really is worth a pound of cure. Before you begin the hiring process, do your homework:
- Familiarize yourself with employment laws.
- Employment discrimination is serious business. Find out what you can and cannot ask potential candidates. Steer clear of questions about age, race, religion, family status, sexual orientation, native language, citizenship status, or place of birth.
- When you bring on an employee, your tax obligations become more involved. Discuss this decision with a certified public accountant.
- Determine what increased liabilities you will be exposed to and arrange for appropriate insurance coverage. If you plan to have employees working in your home, beware that your homeowner’s policy may not offer protection.
Step Five: Spread the Word
There are a number of tools to help you find the right person for the job: networking, classified ads, hanging out a “help wanted” sign, employment agencies, college career counselors, vocational rehabilitation, and even executive search firms—to name a few.
The tool(s) you choose should complement the type of position you are seeking to fill. For example, if you’re looking for someone to fill a clerical or retail sales position, hanging out a “help wanted” sign and placing an ad in the local paper will probably be effective. If you’re looking for someone with specialized expertise, however, consider a well-placed ad in a trade publication or calling an employment agency.
Step Six: Do Your Homework
Before you make a hiring decision, always meet with a candidate in person to conduct an interview. Develop a list of questions to be addressed in each interview, and always interview more than one candidate. Ask for references and follow through by investigating those references. Remember, you don’t have to select someone from your initial pool of applicants. If none of the candidates fit the bill, keep looking.