Ready for some extra assistance but unsure of the hiring process? Congratulations, hiring staff can be a huge milestone.
There are a few key factors to think about whether you’re hiring your first employee, your twentieth, or some seasonal help. Make sure you have everything set up legally and correctly, and then you need to identify the ideal employees.
Don’t worry; we can assist you with the fundamental procedures of recruiting an employee. (This article offers general advice. Make sure to speak with an HR specialist for guidance that is specific to your company.) Here is a list of things to do before and after hiring, along with instructions on how to do it.
Before you hire employees
1. Make sure you have an EIN (Employer Identification Number).
You must register your company with federal and state authorities before hiring personnel. Every company with employees must have an Employer Identification Number (EIN), a special nine-digit number used for tax ID reasons, according to the IRS.
A business’s EIN functions somewhat similarly to its Social Security number. You could already have one if you run your company as a corporation or partnership. If not, you can apply online to obtain an EIN.
Additionally, the registration process for obtaining a state employer identification number varies by state. For more information, go to the website of your state’s labour department. For instance, the Employment Development Department (EDD) in California offers an online service that gives an employer payroll tax account number in a matter of minutes of registration in most cases.
2. Set up records for withholding taxes.
Taxes must be taken into consideration when deciding how to hire your first employee. You need to fill out the necessary papers to pay three different forms of withholding taxes before you can begin looking for the ideal employee.
- Federal income tax withholding
Form W-4 (Employee’s Withholding Certificate), which requests information about how much federal income tax should be deducted from employees’ paychecks, must be completed by your new hire. You then send the IRS the paperwork.
- Federal Wage and Tax Statement.
Every employee must have a completed Form W-2, which includes information about their earnings and the taxes deducted for the year. By January 31st, you must distribute a copy to each employee covering the prior year. Then, before the end of February, send Copy A of the W-2 forms to the Social Security Administration.
- State taxes
Find your state here to access the necessary paperwork. Many states additionally have a state withholding form.
To support their employment tax filings, businesses should maintain their employment tax records for six years (or longer in some situations). Setting up a decent system can help you stay organised so you can monitor the health of your company over time, compile your tax returns and other financial records, keep track of deductibles, etc.
3. Define the role you’re hiring for.
How can you tell when you’ve found something if you don’t know what you’re looking for? Decide what sort of help you require before beginning the hiring process. Make a list of the most crucial things you require assistance with. Is it someone to assist with email marketing, bread baking, or inventory management?
Next, consider the duties you want the incumbent of this post to assume in the future. The type of job you need done, the seniority of the position, and your budget will all affect how much you pay your new employee.
Finally, consider the background, abilities, and level of experience that would be ideal for this position.
You’re prepared to create a job description once you’ve completed this inquiry. You can hire the best candidate if you have a detailed, meaningful job description. To design a more successful job posting and identify the best hires, run your drafts through Textio, a machine-learning engine that highlights gender-biased phrases and jargon.
4. Find your candidates.
Find out if any of your top employees know of somebody who would be a good fit for the position. Referrals save you time since they come with a letter of recommendation and spare you from having to go through a sea of resumes.
But depending solely on staff recommendations may result in a workplace that is less diverse since people like to associate with others who are similar to them. Political correctness isn’t the only consideration here. Your company will benefit from having a more diversified workforce. In fact, research demonstrate that diverse teams perform 35% better than ones that are not. Additionally, 57% of workers believe that their companies ought to be more diverse.
Cast a wider net to identify people with a variety of excellent qualifications. Advertise your position on job-related websites like Indeed, Craigslist, or LinkedIn. Identify your company as an Equal Opportunity Employer and include a statement at the bottom of the post encouraging qualified applicants of all genders, ethnicities, races, and sexual orientations, as well as those with disabilities, to apply. Instagram is a fantastic platform for publicising job openings.
To combat unconscious bias and encourage greater workplace diversity, think about blind hiring, concealing applicants’ names—and perhaps even education—and years of experience.
5. Conduct interviews.
Make an effort to have at least a few staff members interview the applicants. Every employee at your company will walk into the interview with a varied set of objectives, providing you with a more accurate evaluation.
If your company is larger, you can consider doing interviews in panels where each interviewer is asked to concentrate on a certain subject during the interview. In such a circumstance, one individual may emphasise teamwork while another may look for technical talents. This strategy has the dual advantage of allowing you to evaluate a candidate’s extremely precise talents and giving your staff a sense of involvement in the selection process.
6. Run a background check.
You might need to do a background check after selecting a candidate and making an offer. Background checks, sometimes referred to as pre-employment screenings, are a crucial step in ensuring the safety of your company, your workers, and your clients. (This is how to confirm that potential workers are who they claim to be.) A background check must always be authorised by the applicant.
Be aware that there are several state-specific, complicated legislative limits and procedures pertaining to background checks. While some jurisdictions limit the kinds of criminal history queries you may make and the times during the application process at which you can ask about a criminal past, others demand that a role fulfil certain criteria before you can retrieve a credit history. (In certain states and towns, it is against the law for employers to inquire about a candidate’s criminal background.) Businesses typically use a third-party firm to perform background checks in order to meet all of these standards.
There are restrictions on how you may utilise background check data as well. Consult a legal expert for detailed advice or direction on background checks.
7. Make sure they’re eligible to work in the U.S.
You are accountable for ensuring that each of your workers has the proper authorization to work in the United States. You risk fines and perhaps legal repercussions if you recruit someone who is ineligible for the position.
Here’s how to hire people who can work in the United States in order to prevent this:
Your new employee must complete section one of the Form I-9 before or on their first day of work, which includes their contact information, Social Security number, and eligibility for employment.
By their third day of employment, they must present you with appropriate identification and employment permission. This can be one item from List A (such as a passport or Permanent Resident Card from the United States) paired with two items from List B (such as a U.S. driver’s licence from the United States) (such as a Social Security card).
Most of the time, simply completing the Form I-9 and looking through the supporting documentation is sufficient. But if you conduct business in a certain state, you might need to sign up for the E-Verify service.
Form I-9 must be kept on file for three years from the date of hiring or for one year following the employee’s termination, whichever occurs later. Employers are not required to transmit Form I-9 to the federal government.
After you hire employees
8. Report your new hires to your state employment agency.
You have to notify the labour department in your state about all new hires and rehires. Visit the SBA’s New Hire Reporting Requirements for additional details on the rules in your state.
9. Obtain workers’ compensation insurance.
The amount of workers’ compensation insurance that companies are required to carry varies by state. For workers who are hurt or ill as a result of exposure at work, the majority of states mandate that businesses purchase an insurance coverage. Make an effort to carefully examine the laws in your state and choose a policy that is appropriate for your company. A useful manual is available from the National Federation of Independent Businesses (NFIB).
10. Choose a payroll method.
You must set up a system to pay your first employee and handle payroll taxes when you hire them. Payroll can be handled by you, an accountant, or a payroll agency.
Many individuals choose for a payroll service in order to save time and steer clear of all the hassles associated with payroll (like taxes). In order to reduce these hassles, certain payroll services integrate with your insurance company and handle new-hire reporting.
However, it’s a good idea to be familiar with the fundamentals of how payroll functions even if you decide to utilise a payroll provider (or outsource payroll to an accountant). There are three parts to payroll: paying employees, paying payroll taxes (to the IRS and your state’s tax agency), and filing tax forms.
Tracking hours worked, figuring tax withholdings, and issuing checks are all included in paying employees. Depending on the size of your firm, you may need to file payroll taxes and filings every month or every three months.
SW HR Consulting has been helping companies to build their teams and values for over 10 years. Contact us to find out more about our unique hr outsourcing services and see how our expertise can benefit you.