Hiring new employees can be an option to help with the growth of your small business. It’s a big scary step and since a business owner may have been the only employee for a while, it is hard to let go of what one may have worked so hard to build. Sometimes a small business owner doesn’t always have the knowledge or experience to navigate the hiring process effectively.
1. IS IT TIME TO HIRE?
It’s a huge transition and the perfect time to do a review of finances with your bookkeeper. If you are turning down business or the quality of your business has changed or the level of service has decreased, you may need ways of strengthening your business. Do you need support staff to assist with day-to-day operations? Do you need someone with a different skillset that can complement your drive and ambition? Do you just need another set of hands? Are you thinking about adding additional products or services and additional help will support your vision? Would you like to open another location and expand your services?
2. HOW MANY HOURS A WEEK DO YOU NEED?
Deciding what tasks and support you need additional will help determine how many hours a week you need help. Do you want or need a part-time person, a full-time or an independent or seasonal contractor? What is your payroll budget?
Part-time staff is usually less than 30 hours a week. Full-time staff works more than 30 hours a week but less than 40. Do you want an independent contractor or a freelance employee? Contractors or seasonal staff may work 0-40 hours a week and can be more of temporary support whether seasonal or short-term. An independent contractor may save some of the costs associated with hiring since they will be responsible for benefits and taxes. While an independent contractor is a great help if specific services are needed or short-term employment is preferred, hiring someone on as a permanent part of the staff shows a business investment in someone else’s future.
3. CREATING A WELL-DEFINED JOB DESCRIPTION
Having a well-defined role and job title is critical for a hiring experience. A job description will spell out skills, experience, and duties will be important criteria for finding the best candidate for the job. What type of person do you need to be the face or backbone of your business, what is your budget for the wages you want to pay and what tasks will they be performing? For a part-time hire, labor rates are parameters to use with hiring and there are also guidelines for positions that allow tipping. This may be a great time to partner with a business consultant to determine an employee handbook or guidelines to follow.
4. WHO WILL DO THE RECRUITING
Recruiting, hiring, and training can be time-consuming and scheduling time to take on this task may be hard to schedule. This may be a good time to outsource with a recruiter or a labor agency. Budgeting for a service should also be included in your hiring plan. As a small business owner, you may be able to streamline the process by using software and a solid filing system. If the business owner is performing all of the recruiting, hiring and training, time will need to be allocated to adequately perform these tasks without interfering with daily operations.
5. ADVERTISE OR SPREAD THE WORD
Sometimes your best hire will be someone you know. Know where you would like to post your open positions depending on the type of employee you want. A part-time employee may not use the same platform for job searching as a full-time employee. You can utilize your client base, friends and family, church members, or social media websites.
6. SELECT, SCREEN AND INTERVIEW
You may find several potential applicants from your job posting. Be selective and screen your applications to determine the candidates you would like to interview. During the screening process, you want to make notes of a few areas. Review an application for grammatical errors and continuity. Review the candidate’s skill set and relevancy to the position. An application should be filled out in its entirety. Sometimes a quick phone interview will give a great opportunity to determine personality and answer questions regarding the application. From this point, you can gauge basic skills and determine if the interview should go forward. Depending on the type of position, you may need several interviews to determine if the candidate is a good fit. Remember this candidate is a potential member of your team and you want the best fit possible not the first person available.
7. WHAT NOT TO SAY
It is important to note the topics that are off-limits during an interview and stress that you are only accepting applications currently and don’t commit to a candidate until you are making the final offer.
It is always helpful to ask for references and follow up with a phone call. With reference, you can discuss skills, qualifications, and dependability.
8. MAKE THE OFFER
Don’t wait too long to make an offer or you may find yourself starting over with a new candidate and settling for the second-best candidate. Establish a relationship with your top candidate from the beginning and share your thoughts on how they can best serve you and your business. Sometimes pay can be a tricky area to negotiate and be certain to document pay rate and other business perks you may be able to offer.
It is a good idea to present your candidate with a written offer including starting pay, benefits, payroll schedule, start date, hours worked per week, conditions of employment, and review schedules.
Your candidate may ask for time to think about the position. This is very common since the candidate may want to discuss with family or just weigh out their options as well. Set yourself a deadline and after a few days, don’t hesitate to follow up with your candidate and ask if they have additional questions. Be prepared for their answer and have another candidate on deck in case the first one declines the offer.
9. SET UP A PAYROLL SYSTEM
Now that your business is growing, and your staff is expanding, a payroll system may help. As a small business owner, you may choose to do this yourself or outsource your payroll. Many small business owners may use a bookkeeper or accountant or outsource to a service like Gusto.
You will need an Employer Identification Number (EIN) which you probably already have since you needed one to set up a business bank account. This is your employer tax ID used to pay taxes for your business and its employees. You can apply for an EIN online and get your number instantly.
10. ADDITIONAL LEGAL REQUIREMENTS
Hiring new employees can introduce new employment laws and guidelines that you must follow. You will want to make sure to get accurate information on this as it may change from place to place and industry to industry. For example, the Affordable Care Act (ACA) requires some employers to offer health insurance to staff if they work at least 30 hours per week or 130 hours per month. If you do not, you may face penalties.
Additional required benefits can include:
- Paying at least the minimum wage for your applicable area
- Offering leave benefits
- Providing disability insurance
- Buying workers’ compensation insurance
- Register for state or federal unemployment insurance.
- Display workplace rights posters
11. TRAINING AND ONBOARDING
As you begin the process of training, remember that your new employee does not have your knowledge, spirit, or dedication to the business. Even the smallest detail needs to be addressed. Be prepared to be patient and allow your employee to learn and grow.
Prior to the first day of work, communicate to your new employee the dress code, where to park, and where the entrance to the building is. Let them know who they will be training with.
Be prepared for your new hire to arrive on the first day. Have a copy of the handbook, clean the work area, have software logins ready, and be ready to present a work schedule and training expectations. If your business has safety guidelines such as in the food industry, be prepared to discuss these with your new employee and stress compliance.
As you are completing the onboarding process, share your vision and enthusiasm for the business. Let the employee know that you are a resource and are available to help. Present your employee with a training plan and be sure to follow up often to review performance and help your employee feel engaged.
Your business is your lifeblood and represents your hard work and dedication. A new employee does not have that vested interest but you can inspire them to perform to the highest standard. Your new employee will only be as good as your willingness to teach them to do the best job possible. If they work out great, reward them and give them bigger tasks, if they are not a good match, search for a replacement.
As a small business owner, you can stand out in the hiring process when you are looking for the next best team member. Providing flexibility, pay, benefits, and a great working relationship will be helpful in the hiring process. As always, remember to develop your team and have the next best leader waiting to move forward.
