When your small business starts to boom, your tasks will pile up and you’ll eventually be unable to handle them all. That’s the sign that you must now hire an employee.
But for first-timers, hiring an employee is a little intimidating. To avoid the struggle, some startup owners choose among people they already know, like friends, former colleagues, or even family members or relatives. But if the people in your circle are already stable in their own careers, they won’t likely give up their positions to help you out. Plus, it’s a bit absurd to expect them to.
That means you have to advertise a job post on a recruitment website and look through several applications. If you don’t have a background in Human Resources, assessing candidates might be a bit overwhelming. Surely, many candidates are equally qualified. But you can only choose one.
More than paying salaries and assigning tasks, though, knowing how to manage an employee is more important. Assuming you were once an employee, think back to how your bosses and your company’s HR treated you. What did they do apart from paying you? How did help you grow? What would you have changed?
That said, here are the steps you should take before hiring your startup’s first employee:
1. Determine What You Need the Employee For
You have to be specific in citing your expectations from your employee. If you need one because you’re struggling to file and organize your business documents, you most likely need a secretary. In that case, advertise a job post for a secretarial position. Outline the tasks you’d require them to perform. State the qualifications as well; do they need to be a high school graduate? What about the experience?
Determine the business’s end goal as well once you have hired a secretary. For example, paying all your taxes correctly. When all your business documents are properly organized, you can have a file of all receipts, invoices, etc., all of which you need for filing tax returns.
2. Figure Out the Benefits You’ll Offer
Before advertising your job post, consider the benefits you’d offer. A basic employee benefits package is composed of the following:
- Time-off for voting, serving on a jury or performing a military service
- Workers compensation
- Retirement and disability benefits (deducted from their paycheck in the form of FICA taxes)
- State and federal unemployment taxes
- Short-term disability programs
- Federal Family and Medical Leave (FMLA)
The law requires all employers to provide those benefits. But most employers include more benefits in their packages to be more competitive. Though you aren’t required to provide the following, consider them so that you can attract better talent:
- Health plans
- Retirement plans
- Dental or vision plans
- Life insurance
- Paid vacation, holiday, or sick leaves
If you’re hiring a full-time employee, they’d expect one to two weeks of paid vacation time each year. And needless to say, they’d appreciate the rest of the competitive perks, too. So if you’re ready to offer all of those, you’re ready to hire your first employee as well.
3. Compose Your Interview Questions
Depending on the job position, you may or may not ask your candidates to take a test. However, creating an exam questionnaire might be tricky if you’re not an HR professional.
So focus on your interview questions instead. Ask them about their educational background, job experience, and everything related to the information in their resume. Note that there are illegal questions to ask, such as things about their race, ethnicity, or color; gender or sex; religion, citizenship, height and weight, medical information, age, disability, and marital, family, or pregnancy status.
4. Consider the Risks
The U.S. Chamber of Commerce estimates that 75% of employees steal at least once from their companies. Out of that 75%, half steal repeatedly. Meanwhile, statistics from the American Society of Employers reveal that businesses lose 20% of every dollar to employee theft and that the U.S. retail industry loses $53.6 billion to employee theft every year.
Hence, ask applicants to include references in their resumes or application forms. The best way to confirm their favorable work ethics is to reach out to their previous employers or other figures of authority, like professors. And of course, tighten your startup’s security. Even if you’ve delegated them a task, it’s still your duty to oversee their work and to monitor your inventory.
5. Insure Your Business
Every company needs different types of protective business insurance programs. For coverage related to your employees, you’d need a Workers Compensation and an Employee Practices Liability. Workers’ compensation provides coverage for an employee’s medical expenses and/or lost wages if they got injured on the job. Employee Practices Liability, on the other hand, protects your business from false employee-related claims.
Once you’ve hired your first employee, act as their leader, mentor, and of course, their friend. Employees and bosses can form a personal relationship too, especially if it’s just the two of you in a company. That way, your employee will feel more appreciated and valued.