| Friend,
So, you've hired your first employee after much hand wringing and gnashing of teeth. Now, you're ready to put your minion to work and live a life of leisure...
Well, hang on there evil genius, because we have paperwork to do. Like, ass-tons of it. And you can thank the government and the lawyers for that.
But never fear - I'm going to run it down for you, piece by piece. Most of these forms are easy to find with a simple web search, although the exact paperwork required will vary depending on where you live.
Also, caveat time - this is what's required if you live in the good ole' U.S. of A. I can't even begin to tell you what you'll need to fill out if you live in one of those weird hippie reefer-smoking European socialist countries. (I imagine it'd start with a form for social welfare benefits for your employee, because that's actually one of the first things on the list I've compiled below - so much for capitalism, right?)
Alright, enough with razzing those of you who aren't lucky enough to have to deal with all the big government bureaucracy we have here in the States - here's a list of what you'll need to do as soon as your new employee is hired: - Make sure you have an EIN - Here in the States, you need an employer identification number from the IRS so they can track you down if you fail to pay your fair share of withholding and so on. You're going to put that number on a lot of forms, so you may as well memorize it. Also, check with your state's department of labor or labor commission, because you probably have to register with them as well.
- Get with your accountant to set up your payroll systems. You'll need to be tracking withholding and all those other goodies, so it's best if you get your accountant to lend a hand when you set it up, if only to ensure you don't miss anything (like yearly filing of a Form 940). Also, QuickBooks is probably one of the easiest ways to get this set up, so plan to invest in some software.
- Get worker's compensation insurance. Even if your state doesn't force you to get it, you'll be glad you did later.
- Have your employee fill out a W-4 (for the IRS) and an I-9 (para la migra), and get copies of all the required verification docs for those forms. Incidentally, this would also be a good time to set up an employee file, so you have a place to file all that info away.
- The Department of Labor also has some requirements regarding posters and notifications you they want you to hang in a conspicuous place. I suggest the broom closet, as those posters are sure to brighten any room.
- Get your employee to read your employee handbook, and have them sign an acknowledgement that they have done so. This should be the first thing you have them do on orientation day (yes, they're going to be on the clock - if you want to make it go quick, take them through it section by section). And if you don't yet have one, get this book - it'll help you understand what you need to include and why. And if you need to get one put together fast, you can always use a service like Rocket Lawyer or Legal Zoom to do so.
- Have your employee sign other pertinent agreements, like a non-compete agreement, a non-disclosure/confidentiality agreement, and a work at-will agreement. Your mileage may vary as far as enforcing these agreements later (depending on where your business is located), but it can only help you to have an employee sign them, should one leave and try to take your clients with them. Sometimes just the threat of a lawsuit and the associated costs is enough to deter someone from trying to screw you. So, create those forms and get them signed. Also, check out MyAttorney software for help with creating some of these forms.
Alright, that's likely enough to make your head spin, but it's all necessary to protect your business and to make sure you stay out of hot water with the various alphabet soup bureaucracies.
Tomorrow I'll be back to talk about employee training - yay!
Until next time,
Mike Massie MartialArtsBusinessDaily.com
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P.S. - You need to have written policies to cover every conceivable eventuality. Here's a short list of things that should be covered by your employee handbook: wages, timekeeping and scheduling, at-will employment, how to request time off, discrimination and sexual harassment, how to file a complaint, health and safety issues, your drug and alcohol policy, your privacy policy, employee use of company email addresses and company social media accounts or websites, and your policies on what employees post online on their personal blogs and social media accounts.
P.S.S. - I know it seems like overkill, but having policies on all this stuff will help you later if you have to document why you terminated an employee. I'll cover employee disciplinary measures in a later email, but for now just know that your employee handbook needs to cover this stuff. |
