Deciding to Hire Someone

How do you know when to hire your first employee? Hiring staff could be the right decision if you experience one or more of these events in your business:

• You’re turning down new clients or new projects from existing clients.
• You’ve identified a specific group of tasks that someone else could do to generate money and/or save you time.
• Your customer service is suffering.
• You’ve identified a new product or service line but don’t have enough bandwidth to launch it.
• You’d like to open a second office or shop.

Making the decision to hire staff means taking on additional financial and administrative responsibilities. You’ll need the cash flow to pay them, and you’ll need to learn how to manage the taxation and financial forms and activities that accompany becoming an employer.

Creating a Job Description

Once you’ve decided to hire an employee, it’s time to create a detailed job description. The job description tells candidates about the tasks and responsibilities that accompany the role you’re looking to fill. Once you’ve found the perfect candidate, the job description then becomes an important benchmark for performance evaluation. Does your employee satisfactorily carry out all the described responsibilities?

Use these tips to create a job description that’s clear and concise, yet detailed enough to attract the right candidates.

1. Full-Time or Part-Time?

Do you need a full-time or part-time worker? It’s important to identify full-time workers to determine whether you must offer “minimum essential [health insurance] coverage” to avoid an employer payment.

According to the U.S. Department of Labor, the Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, record-keeping, and child labor standards impacting full- and part-time workers. The FLSA doesn’t define what constitutes a full-time or part-time worker — but the IRS does.

The IRS says that a full-time employee is, for a calendar month, an employee employed on average at least 30 hours of service per week, or 130 hours of service per month.

2. Choose a Job Title

What’s the title of the role you’re creating? Choose a job title to reflect the main responsibilities of the job, such as Internal Salesperson, Customer Service Representative, or Marketing Manager.

3. Create the Job Duties Section

This section is the “meat” of your job description. It includes the job’s main responsibilities, the areas of the business the employee will work in, and the estimated percentage of time each accountability area should take. Also list the specific tasks required by the role in the job duties section.

Start the job duties section by listing three to five accountability/responsibility areas or functions. Next, brainstorm the associated specific tasks and duties for each area — list everything you want this employee to do under each area of responsibility. Then arrange the associated tasks/duties into duty statements to accompany each accountability area.

For example, let’s say you plan to hire an external salesperson. One area of accountability might be external sales calls. Duty statements for external sales calls could include:

• Researching and generating sales leads
• Initiating contact with leads
• Following up sales calls
• Meeting personal sales goals
• Tracking sales using company financial software
• Closing the sale

Finally, estimate how much time the employee should spend on each accountability area.

4. Required Skills or Qualifications

List the specific required skills for the position here. Perhaps you require specific customer service experience, or familiarity with software such as MS Office or Adobe Creative Cloud. Include any second language — or programming language — requirements here, too.

This is also the place to highlight educational requirements or professional designations required for the position.

5. Determine the Pay Rate

Although it may not be part of the published job ad, you need to set a pay rate. If you’re wondering how much to pay when hiring new employees, you’re in luck. You can review online resources such as PayScale to see the median salary/hourly wage for typical job titles according to location across the United States. Another good salary resource is Glassdoor.

The Bureau of Labor Statistics also offers pay scale information sorted by occupation, state, and metropolitan area.

How to Write a Job Ad

Creating a job ad is similar to writing a job description. The job description is an “internal” document for use within your business to help you understand what type of position you need to hire for, and what your new staff member will do.

The job ad, however, will have a public audience, and lets potential employees know what you’re looking for. It’s specific, provides a taste of your company culture, and helps your business stand out among the many other job postings qualified candidates are reviewing. Use the job description you created above (especially the Job Duties and Required Skills sections) as the foundation for your job ad.

What to Include in Your Job Ad

Think of your job advertisement as a creative, eye-catching summary of your job description. When you’re writing it, think about your ideal candidate. What should your opening sentence include to grab his or her interest?

Remember, you’re selling your business as a great place to work, and, at the same time, you want to attract top quality candidates.

You should also think carefully about the future opportunities that you could offer an employee who is successful in this role. According to the 2016 Pew Research Center’s The State of American Jobs, 87% of workers believe they’ll need continuous training to develop new skills to remain successful in the workplace. Including development and training opportunities can make your job more attractive to candidates.

Here’s what your job posting should include:

• A headline, including the job title
• Two to three sentences including critical information about the job; summarize the major accountabilities/areas of responsibility here
• Required experience, qualifications, and education/professional designations
• A brief sentence or two on your company; if you’ve developed an “elevator pitch” for your organization, you could use it here
• Your contact information, including how you’d like candidates to contact you to submit their resumes
• Whether you’d like the candidate to submit a cover letter and work samples, in addition to their resume

Take a look at these sample job postings for a receptionist and an office administrator to help you create your own custom posting.

Where to Post Your Ad

Advertise your job posting in places where your ideal candidate would “hang out,” which in today’s world often means online and on social media platforms. You could post a job ad for free on your company’s Facebook page or from your Twitter account. If you’re posting an entry-level position, you may want to post your job on your local college’s online job board.

Other places to post job ads online include sites such as :

• LinkedIn
• indeed.com
• monster.com
• Craigslist
• ZipRecruiter
• CareerBuilder
• SimplyHired

Do you have a local or state unemployment office nearby? Their website could be another good place to post your ad — and it will probably be free. Simply do an internet search for “where to post a job for free in [add your location here].”

How to Review Resumes

Once you post your job opening and the resumes start rolling in, you’ll need a plan to organize them into groups: “yes,” “no,” and “maybe.”

According to Fletcher Wimbush, CEO of talent assessment firm The Hire Talent, business owners have a choice of two strategies. A free or inexpensive digital Applicant Tracking System (ATS) like Osclass, BambooHR or Workable lets you rank applicants on a scale of one to five. “One or two are nos, threes are maybes, and four and fives are yeses,” says Wimbush. “The ATS then will allow you to sort and contact the fours and fives more efficiently.”

If you’re looking for a simpler solution, Wimbush suggests simply printing out or creating a digital folder to hold your “yeses” and “maybes.” “Then start from the best and work your way through to the maybes if needed.”

Once you have a list of potential candidates, how do you decide who to bring in for an interview? Wimbush suggests that you reach out to your top candidates and connect within 24 hours of receiving their resume or application to make your short list. “It’s also a good idea to follow up and reach out again every three to five days if they don’t respond just in case they missed the first attempt to be contacted – maybe it went to a junk mail folder, or they were away and not checking emails,” he says.

You may follow this up with a short email assessment test — for example, three to five questions relating to some aspect of the position you’re hiring for. According to Wimbush, this is an efficient method of getting “a strong perspective of the talent market,” allowing you to effectively compare your candidates based on information you’ve gathered in a short time frame, so you can move along to the interview process.

Wimbush says he short lists two to five candidates to bring in for more in-depth, in-person interviews, usually lasting one to two hours each. This gets followed by a job shadow day or work sample project to finalize the selection process.

Red Flags to Watch for When Reviewing a Resume

Most job candidates put their best professional foot forward when it comes to their resume. They’ve had time to create it, polish it, and many have gotten professional help to edit it. So this is likely the most professional reflection you’ll get of the candidate. That’s why it’s important to check for red flags like:

• Non-professional email address
• Random personal information, like a horoscope sign or birthday
• Non-professional language or slang
• Spelling and grammatical errors

These could indicate potential communication problems down the road, both between you and the employee, and the employee and the public.

Also take a look at the job history section. Are there any noticeable gaps in employment? And just how long have they stayed in their previous positions?

“People who do not stay in jobs for more than three years and preferably five years are problematic,” says Wimbush. “Most jobs take at least one year to acclimate to, so anything in the one to three year range makes it difficult to demonstrate or sustain top performance.”

Look at the job titles and employers. Is there a progression in responsibility and job level? Or have there been several comparable jobs within a short period, with no progression? These could indicate job performance issues.

How to Conduct a Job Interview

If you’re a small business owner who’s never conducted a job interview before, you could be just as nervous as the candidate you’re about to see! You can reduce your nervousness by being well prepared.

1. Explain to the candidate what will follow during your interview. Tell them you’ll give an overview of your company, ask them some questions that require specific examples, allow them time to ask questions themselves, and then wrap up by advising them of the next steps.
2. Always give the candidates the true time frames for next steps. Although you may feel you want to hire the ideal candidate the next day, the reality is it may take many weeks.
3. Avoid the temptation to talk too much! Remember that you want them to do most of the talking — and you need to listen.

Sample Questions

Use these sample questions as a general framework for your interview, before adding interview questions specific to the role and your company.

1. What interests you in working for this company?

The candidate’s answer to this question lets you know if they have looked into your business, or
the specific role — in other words, how well prepared they are for the interview.

2. Tell me about a time when you dealt with a challenging customer, and what did you do to resolve the issue?

See if they give a real example or a generality. This tests their ability to deal with “that” irate customer — an important skill — especially if you’re hiring for a customer service role. This is also a good question to get an idea of how innovative (or not) an individual may be when under pressure.

3. Give me an example of where you assisted in an area outside your normal role.

Pay attention to the following when listening to the answers to this question:

• Do they readily give examples of wanting
  greater involvement?
• Do they feel that they only have to do one
  specific role?
• Are they willing to work as a team player?

Occasionally, small businesses may need an employee to jump in and help with tasks outside their own job description, so flexibility is important.

4. What was your biggest learning experience to date and why?

A job candidate’s answer to this question could reveal all sorts of interesting information. First, this will tell you if they are open to
learning new things. It could also demonstrate their willingness to accept
responsibility for mistakes, and show their comfort level with discussing
challenging issues,

5. What do you feel you can accomplish in your first 90 days?

This answer will tell you if they are somewhat organized in their planning, and if they feel they can hit the ground running, or if they’ll require more training and a longer learning curve. And, if they’re interested in first learning what the problems are before suggesting solutions, that’s a great sign, indicating logical thinking.

6. What questions do you have for me?

The things that interest a candidate indicate his or her priorities. Are they more interested in how much vacation time they’ll have, or their responsibilities in the job? Are they curious about your business’s history, current issues, and expansion plans?

Their questions will tell you if they have truly
investigated your place of business, how interested they are in being part of your organization, or whether their bigger focus is on themselves. Finally, you’ll get an idea of whether they’re able to take advantage of such an
open-ended question and think critically and creatively.

What You Cannot Ask (Legally)

Before interviewing a candidate, it’s important to know that there are some things you just can’t ask. According to the U.S. Equal Employment Opportunity Commission (EEOC), you should avoid asking questions related to a candidate’s:

• Age
• Race, ethnicity, or color
• Gender or sex
• Country of national origin or birthplace
• Religion
• Disability
• Marital or family status or pregnancy

Also avoid asking questions that could be perceived as looking for the information in a roundabout way. So don’t ask questions such as “Do you have after-school activities that interfere with your ability to work late?” or “Will this role interfere with your spouse’s work?”

Determining Which Candidate to Hire

After you’ve reviewed all the resumes and interviewed your final candidates, it’s time to choose whom to hire to work in your small business.

Think back to the interview and any other interactions (such as email or phone conversations) you have had with each candidate.

• Was she comfortable with you, and did she show an interest in your business?
• Did he struggle to think of specific examples or answers in the interview?
• Did she talk too much, or too little? Did he display professionalism at all times?

Sometimes business owners face the challenge of choosing between two close candidates with similar work experience and education. To help you choose, decide which candidate best fits your business’s culture and shares your values. Think about which candidate you felt most comfortable with, and who was able to most clearly articulate their past work accomplishments.

Don’t forget to follow up with their references. While most people include reference names of people who’ll say good things about them, you can ask their references about areas in which the candidate may need to improve. Their answers may surprise you, and help you make your decision.

Note: According to the EEOC, the rules about which questions you can’t ask an applicant also refer to any communications regarding that applicant, including reference checks, and when communicating with an applicant’s former employer, family, or friends.

What to Include in Your Offer Letter

Now that you’ve selected the candidate who best fits your organization, it’s time to offer him or her the position. Nowadays, most job offers are first made informally, often by phone but you should follow up with an offer letter that serves as a formal and more detailed record of your offer.

Job offer letters help protect you and your new employee should any disagreements arise in the future over the terms of their employment. Watch the wording you choose — you don’t want the offer letter to mimic a contract, as this could result in legal headaches should your working relationship not work out. Pay particular attention to what you include (and exclude) from the letter.

Note: Get a legal expert to review your offer letter before presenting it to the job candidate to make sure it covers what it needs to and doesn’t use any language that could land you in court should a dispute arise down the road.

Keep these things in mind when creating an offer letter.

1. Legal Requirements

Before crafting an offer letter to a potential employee, keep in mind that it should fulfill the state legal requirements for your location. Visit your state department of labor website to find the requirements for your area.

2. Job Title and Basic Info

The opening of the offer letter should include the basic information about the position you’re offering. This includes:

• Job title
• Start date
• Orientation/training dates (if applicable)
• Full-time or part-time status
• Shift (if applicable)

Avoid using any words or phrases that could suggest any guarantee of future employment. The Society for Human Resources Management suggests avoiding terms like “job security,” “we’re a family company,” or “in the future.”

3. Salary and Any Bonus/Commission

Your offer letter should include details on the compensation and pay period for your employee. Set out compensation hourly, weekly, or per-period so your prospective employee won’t expect to get the whole year’s compensation if employment ends before year-end.

Also mention to whom your employee will report — even if it’s you because you are currently the only one working in your business. Finally, include a brief sentence about evaluation periods, such as “your performance will be evaluated after three months’ employment, and on an annual basis thereafter.”

4. Benefits and Paid Leave

Include a brief summary of the benefits included with the position, plus the eligibility requirements and time frames for the following:

• Health insurance
• Life insurance
• Short- and long-term disability
• 401(k) or other retirement plan
• Flexible spending account (if applicable)
• Educational assistance

Also describe any paid leave you offer in addition to those legally required (see Legal Issues Specific to Hiring, below). Include sick days and personal days, paid time off/vacation days, and holidays.

5. Conditions of Employment

In a paragraph, include any employment conditions a candidate should meet. This could refer to things like passing drug tests, satisfactory responses to background checks, willingness to sign confidentiality agreements about your business and products, completion of a Form I-9 to verify U.S. employment authorization, and compliance with immigration law, if applicable.

Has the candidate worked for a competitor, or a similar business? If so, include a sentence here stating that a condition of employment includes the employee’s not being bound by non-compete or other agreements with previous employers. When he or she signs the offer letter, they’re confirming that they’re free of previous employer agreements.

6. At-Will Employment

In the U.S., offer letters for new employees should include what’s known as an “at-will statement.” This helps identify the employer-employee relationship as not being a contract, which would obligate the employer and the employee to contract terms for a specific length of time.

An at-will statement lets employers terminate employees when they choose, with or without cause, and it also allows an employee to resign from the position at any time.

7. Time to Respond/”Respond by” Date

Make sure you include a “please respond by” date so your potential new employee knows when the job offer expires.

Learn the Basics of Insurance, Taxes, Payroll, and Legal Issues Specific to Hiring

As a small business owner who is also an employer, you’ll need to understand some payroll, insurance, tax and legal basics to protect you and employees — and to stay on the right side of the law. Here are a few things to know when you’re new to hiring employees.

1. Payroll Issues

Put in place a payroll system that will help ensure employees are paid accurately. Options for small business owners include payroll systems like Intuit Payroll, OnPay, Gusto, PayChex, or Patriot Payroll.

Your payroll system can calculate and withhold social security taxes, employee taxes and workers compensation. Use it to file your payroll taxes each quarter, then automatically send in any quarterly state and federal payroll taxes owed. Some payroll systems have additional features and may also integrate with your benefits program or accounting system.They also generate reports to help you manage your business and staffing needs more efficiently.

2. Insurance

Workers’ compensation insurance and family and medical leave as required by your state. Workers’ compensation insurance protects employees and employers by providing benefits to employees who suffer work-related injury or illnesses, and even provides the family of a deceased worker a financial benefit; the requirements vary significantly by state.

Employers may choose to provide health care insurance and retirement benefits. You can learn more in the SBA’s guide, Hire and manage employees.

Depending on your state, you may have to pay unemployment insurance. Search your state government website for more details.

If your business is in any of the following states, be aware that there are state-mandated disability insurance requirements:

• California
• Hawaii
• New Jersey
• New York
• Rhode Island
• Puerto Rico

Depending on your industry and location, consider protecting your business with a fidelity bond. These bonds help protect businesses from losses due to employee fraud and theft.

3. Taxes

When you become an employer, you must withhold, deposit, report, and pay employment taxes. You’ll identify which forms your employees must complete and return to you, which ones to keep on file, and which ones to return to the IRS or the Social Security Administration. Here’s what you need to know.

1. If you don’t already have an employer identification number (EIN), also known as a Federal Tax Identification Number, apply for one online. You’ll need this to submit tax information on your employees.
2. Next, identify that your employee is what’s known as a common-law employee. According to the IRS, this means that you, as the business owner, “control the services that will be done and how it will be done.” Other tax classes of workers include statutory employees, non-statutory employees, and independent contractors. Knowing the tax employment status of your worker helps you identify how to treat the payments you make to the worker when it comes to taxes.
3. Set up tax records for each employee. Visit the IRS Employment Tax Recordkeeping page for an up-to-date list of what’s required. At the very least, expect to set up records for Federal Income Tax, Social Security, Medicare, and Federal Unemployment (FUTA) Tax for each employee.
4. Learn how to withhold and deposit Federal Income Tax, Social Security, Medicare, and Federal Unemployment (FUTA) tax for each employee by visiting the IRS Understanding Employment Taxes page.
5. Visit your state government website for state tax forms required for each employee, and learn what you’ll need to complete for each.

4. Legal Issues

In addition to insurance, taxes, and payroll issues, as an employer, there are several legal issues to become aware of. The SBA provides an overview of employment and labor laws to which your business will be subject, now that you have employees.

Verify your employee’s eligibility to work in the United States by having your employee complete Form I-9, Employment Eligibility Verification.

Register with your state’s New Hire Reporting Program. Federal and state laws require employers to report all new hires within 20 days of hire or even sooner, depending on your state.

If you choose to run a criminal or credit background check on your new hire, make sure you tell the individual you plan to run the check and comply with the legal requirements to run a background check on your new hire. For example, employers across the country must get an individual’s permission in writing prior to running a credit check, while the laws around checking criminal records vary from state to state.

Conclusion

When the time comes, hiring employees is one of the most important things you will do as a small business owner. The ongoing success of your business depends on assembling the right team — helping ensure that you have the right skills, personalities, and relationships in place to serve your growing customer base.

While the various steps may seem daunting, don’t get discouraged by the amount of work involved in hiring new employees. After all, the fact that you need help is a great sign — it means that your business is expanding.

Use this guide as a framework to methodically plan your hiring process. You’ll save time, reduce your stress, and soon be welcoming a new member to your business team.

— thehartford.com

Original Article Here