<p>Hiring your first employee can be a very exciting time. You will finally have time to do all those little nagging administrative things you have been meaning to do you while the employee minds the shop, talks to customers, or makes the donuts. Or vice versa. However, this can be the beginning of a very challenging time in your business's development.&nbsp; If you are thinking that a new hire will entirely free you up to do other tasks, think again and consider the following prior to proceeding.</p> <p>First, hiring new employees brings with it added administrative burdens mandated by federal and state law.&nbsp; For starters, you will need to have each new employee provide you with an <a href="http://www.uscis.gov/portal/site/uscis/menuitem.5af9bb95919f35e66f614176543f6d1a/?vgnextoid=31b3ab0a43b5d010VgnVCM10000048f3d6a1RCRD&amp;amp;vgnextchannel=db029c7755cb9010VgnVCM10000045f3d6a1RCRD">Form I-9</a> indicating that they are eligible to work in the U.S.&nbsp; This form should be maintained in the new hire's personnel or payroll records.&nbsp; Next, you will need to <a href="http://www.irs.gov/businesses/small/article/0,,id=98862,00.html">withhold social security, medicare, and taxes</a> and remit them to the IRS at the appropriate time. WHen you remit depends on a number of factors, such as the amounts of money you are withholding from employee's wages.&nbsp;</p> <p>Second, you will need to comply with the Fair Labor Standards Act (FLSA) requiring the payment of minimum wages and overtime or classify the employee as exempt under one of the handful of <a href="http://www.dol.gov/elaws/esa/flsa/screen75.asp">FLSA exemptions</a>. Whether a new employee may be classified as exempt from FLSA requirements will depend on the nature of your work and the activities to be carried out by the new employee.&nbsp; The new employee may be salaried or a wage-earner but in either case will have to receive the federally and <a href="http://www.lni.wa.gov/workplacerights/wages/minimum/default.asp">state mandated minimum wag</a>e but may not need to be paid overtime if they are exempt.&nbsp;</p> <p>Third, you will want to consider having the new employee sign a confidentiality and restrictive covenant agreement along with that I-9.&nbsp; Failure to have a new employee sign a confidentiality agreement at the outset of employement may trigger the requirement for payment of additional "consideration," or some form of money or equity, if you want to obtain such an agreement later.&nbsp; While you may believe that you do not need a confidentiality agreement, think again.&nbsp; If you have customers, you have an asset that may walk out the door if your employee decides to leave and solicit those customers.</p> <p>Last you have to make sure that you have adequately trained the new employee to be successful in the new position and implemented a bi-annual performance review process. Performance management, while quite an undertaking, will assist you in guiding the new hire to excellent performance and to good relations with the boss - you. In the event things aren't working out or you need to let go of the employee because the business is not doing well, a performance management program will insure that you have all the personnel records you need to support your decision. And when a dispute does arise, which it will either with this employee or with the next one, consider obtaining a general release from the outgoing employee after consulting with your attorney. This will avoid unnecessary and costly disputes and keep your relationship amicable.</p> <p>Hiring your first employee is a big step and one you should not take lightly. There are ample opportunities to mistakenly go astray. Consider speaking with your legal counsel or business advisor before you decide to go this route.&nbsp; If an employee is not the right course of action now, they will be able to help you identify alternatives. Good luck!</p> 2009-09-28T18:16:58Z -2.03016 394 6696 true 6 40315 how-to-hire-your-first-employee 7 2009-09-29T13:55:30Z 2009-09-29T16:56:00Z

Thinking about hiring your first employee but not sure of everything that goes into it? This article provides a summary of some of the most important considerations to help you get started.

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