Your business is bustling, the phone is ringing, and orders are flying. Congratulations on getting your company this far! But if you find yourself “living” at your business to keep up with its demands and are sacrificing your health and happiness to keep your business afloat, it’s time to hire some help.
But before you post a job listing online or dust off your interviewing skills, you’ll need to sit down and assess whether your business is in the position to hire a regular employee.
This week, we cover the signs that your business is ready to hire and the basic components your company needs in place for a smooth onboarding process.
Let’s get started.
Evaluate Your Financials
The first step in assessing your hiring readiness is to evaluate your financial state. Do you have the budget to support a new hire? This includes not just their salary but also additional costs like benefits, taxes, and potential insurance.
Carefully consider whether your current financials can accommodate the responsibilities that come with having an employee. Be sure to meet with your bookkeeper to review your monthly cash flow and assess how these costs will fit in with your expense budget. (If you don’t have a bookkeeper, your first step is to hire one and get your financial books in order.)
If budget constraints are a concern or your revenue varies month to month, explore options for financing the hiring process. If you’re looking to hire, it almost surely means you’re at your capacity for how much work you can handle on your own, which means you have no way to increase your company’s revenue without help.
Borrowing the funds you need to hire can get you the help you need to take on more business and make more revenue in the long term. Plus, borrowing ensures that you're not compromising the financial stability of your business while you expand.
Get Your Paperwork In Order
Any time you hire an employee, you’ll need to complete some paperwork on your end. Have your prospective employee fill out a W2 for tax withholding and an I-9 statement to verify their eligibility to work in the U.S. This step is crucial for compliance with immigration laws. Keep these forms on hand and organize a recordkeeping system for employee tax withholdings.
Keeping meticulous records is not just good practice; it's a legal requirement that will save you headaches during tax season. Remember that bookkeeper we talked about? This is another place where they can help you keep your financial records organized and ready to go when it’s time to make tax payments.
In addition to tax paperwork, consider what benefits, if any, you’ll offer to your employees and have this information prepared to share with them during the hiring process or shortly after.
If you haven’t already, fine-tune your company’s workplace policies in the form of an employee handbook that you can give to your new hire on their first day. Hours, vacation, dress code, and behavior expectations are all things you should document and provide to your employees. This is not only important to set employee expectations but also protects you from employee disputes in the future.
Put Insurance Protections In Place
Hiring can bring the help you desperately need, but having another person working in your business inherently comes with some added risk. Make sure you have business umbrella coverage in place or update your insurance carrier to let them know you’re hiring in-house staff.
You’ll also need to sign up for workers' compensation insurance, a mandatory requirement that protects both your business and your employees in case of on-the-job accidents or injuries.
Lastly, don’t forget to display state and federal labor law notices at your work site to inform your employees of their rights and responsibilities. These posters and bulletins can be easily ordered from online retailers or downloaded for free from the state’s workforce website and the federal OSHA website.
Here to Help You Hire and Grow
Hiring your first employee is a significant milestone for your small business. To ensure a seamless hiring process and to make sure your business is set up to thrive with the changes and growth that an employee will bring, sit down with me, your trusted LIFTed Business Advisor.
I offer legal guidance before, during, and after the hiring process, ensuring that your business is not only ready to hire but also positioned for long-term success across every area of your business, including your Legal, Insurance, Financial, and Tax needs.
Book a complimentary call today to get started.
This article is a service of a Personal Family Lawyer®. We offer a complete spectrum of legal services for businesses and can help you make the wisest choices with your business throughout life and in the event of your death. We also offer a LIFT Business Breakthrough Session™, which includes a review of all the legal, financial, and tax systems you need for your business. Call us today to schedule.
The content is sourced from Personal Family Lawyer® for use by Personal Family Lawyer® firms, a source believed to be providing accurate information. This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal, or investment advice. If you are seeking legal advice specific to your needs, such advice services must be obtained on your own separate from this educational material.
We offer a complete spectrum of legal services for business owners and can help you make the wisest choices on how to deal with your business throughout life and in the event of your death. We also offer you a LIFT Your Life And Business Planning Session, which includes a review of all the legal, insurance, financial, and tax systems you need for your business. Schedule online today.