Eight steps to employ the right person legally
1 Obtain an EIN
The Employer Identification Number is often referred to as an Employer Tax ID. It’s necessary for reporting taxes to the Internal Revenue Service (IRS). Click here to apply for your EIN online or call 1-800-829-4933.
2 Set Up Records for Withholding Taxes
You must keep records of employment taxes for at least four years. Good records can help you monitor progress and prepare financial statements. QuickBooks is a popular software used for this purpose. A bookkeeper can also help.
3 Visit US Dept. of Labor (DOL)
Learn the basics at www.dol.gov. You’ll find Occupational Safety and Health Administration (OSHA) requirements for safety compliance and information on labor laws pertaining to minimum wage, overtime and fringe benefits.
4 Visit Your State’s DOL Website
Determine if you are required to purchase workers’ compensation, a form of insurance providing wage replacement and medical benefits to employees injured in the course of employment.
5 Determine Pay Rates
The two most common ways to pay are hourly and commission. Commission means paying employees a percentage of each job. When deciding which way to go, think about the time involved and what works best for your goals. You must pay at least minimum wage, but the exact wage should be determined based on similar jobs in your location and the amount you charge clients. Call other cleaning companies and ask questions. Check out their websites and employment ads. Also, decide when pay days will be. Nothing makes an employee bolt faster than fuzzy details about their pay.
6 Place an Ad
Make sure to detail hours, pay and contact information. Do some pre-screening. Determine whether a candidate can pass a background check and drug test, as well as if they have a car (if required).
7 Interview Applicants
List what you really care about, and interview based on that list. Common considerations are how long a candidate has been able to hold down jobs, whether or not they enjoy caring for other people, and how detail oriented they are. A great website for small business information, including tips about questions to ask job candidates is allbusiness.com.
You’ve found a wonderful candidate, followed the rules and hired your first employee. Congrats! Now your challenge is to retain them. Follow these eight steps, and you’ll get the help you need legally and from someone you’ll enjoy having on your team. Good luck, Boss!
Liz Trotter is founder of American Maid Cleaning as well as an entrepreneur and leadership trainer based in Olympia, Washington. She is also a former ARCSI board member, creator of the Culture Circus employee development system and a charter member of Cleaning For A Reason. For more information, click here.