20
Apr
2021

Everything to Know About Hiring Your First Employee

Making the first hire is a big step for small businesses. Besides the sense of responsibility for someone, this is a strong signal that your business is headed in the right direction. The fact that someone turned down other vacant positions to help your business realize its goals and objectives also means a lot. Unfortunately, this big step comes with a fair share of excitement and uncertainty.

New employers often find the hiring process challenging and unsure if they made the right hire. Besides, bringing someone on board comes with a new string of liabilities, expenses, and legal obligations. That said, consider the following tips before hiring your first employee.

  1. Don’t Always Follow Your Intuition

Regardless of whether your new hire will be on the front desk, filing documents, or configuring IT systems, underqualified, criminals and emotionally disturbed persons are everywhere. So to say, more than 40% of resumes and job applications have inflated and unreal facts. This is justified by the increasing number of negligent hiring litigations. Terror-related acts, identity theft, and corporate scandals have also increased, making it unsafe to trust your guts.

That said, conducting thorough background checks is important before making any hire. Important things to check include prior employment claims, drug tests, driving history, credit history, and criminal records. While most of this data is available publicly, personal records such as education, medical, and military information are confidential and require applicants to consent for the search.

Similarly, when prying for the applicants’ criminal past, criminal convictions, arrest records, civil suits, and other judgments shouldn’t be part of employment background information after seven years. Some states have stringent reporting rules that apply as well. For instance, bankruptcies are eliminated after ten years.

  1. Some Interview Questions Are Off the Limits

Be it in-person or written application, asking some questions is unlawful. Inquiring about the candidates’ age, marital status, sexual orientation, and race amounts to discrimination. You should only ask questions about emotional or mental handicaps if the candidate applies for special accommodation. During the interview, be mindful of the following questions guided by the federal law;

  • Title VII of the Civil Rights Act of 1964, which highlights various forms of workplace discrimination and harassment
  • Americans with Disabilities Act of 1990
  • The Family Medical Leave Act of 1993
  • The Age Discrimination in Employment Act of 1967
  1. Always Check the References

Before giving potential candidates formal job offers, ensure that you verify their stated references. In most situations, candidates may provide professional references and others to endorse their characters. It is important to consult with professional references to learn more about their professional abilities. However, keep your inquiries objective.

For instance, when inquiring about their previous job positions, ask questions related directly to their duties and performance. Note that discriminations may also occur during these situations. For instance, for personal reference, establish how they know the person, general characters, and work ethic.

  1. Set the Minimum Wage and Employee Classification

Federal laws provide a clear guideline on how businesses should set salaries and classify their employees. The law also provides the minimum employment age for various sectors. Depending on your business finance and hiring needs, determine if you should hire applicants to be part-time or full-time.

The U.S Department of Labor classifies part-time employees as those working less than 20 hours weekly while full-time workers report more than 30 hours. Note that different states have varying minimum wages and benefits part-time employees are entitled to. Therefore, check your states’ corresponding guidelines from the department of labor.

You should also classify employees properly for tax reasons. In this, categorize your employees as common-law employees, independent contractors, statutory employees, and statutory nonemployees. Wrong classifications can lead to hefty fines and criminal charges.

  1. Prepare Your Legal Documents

Most small businesses focus on delivering quality products and services, forgetting the legal aspects of business operations. While they may operate incognito for some time, this is not a good approach to business as legal issues may sink your hard-earned business. Of much importance is preparing employment contracts, employee handbooks, and other essential legal documents. Working with employment lawyers can ease this seemingly challenging aspect of employee hiring.

Additionally, you should update several legal records to complete the hiring process. The Department of Labor outlines that employers should document the following employee records;

  • Full name and social security number
  • Date of birth for employees aged below 19 years
  • Mailing address and the ZIP code
  • Employee working schedule
  • Payment intervals – could be weekly or monthly
  • Hourly pay rates
  • Total daily and weekly earnings for every workweek
  • Additions and deductions from employee earning

Bottom Line

While the pointers mentioned above don’t represent everything you should know before becoming someone’s boss, they highlight the main hiring best practices. Other issues include providing insurance coverage, sorting immigration issues, designing the onboarding process, and providing a safe workplace environment.

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