Recently I have found myself considering hiring an employee for my solo practice. And it is EXCITING! Here's the thing about me, I thrive when I have a team around me. I'm all too aware that I do not know everything, who does? If you think you do, you don't! Over the past couple of years, I have been given the opportunity to hone in my management style and the result is this... I enjoy building a collaborative space where my team can thrive by sharing ideas and executing our common goals and vision. I cannot do that alone so it is time! But, where to start??
Even though I spend most of my time working with clients on this very topic, it has come to me as a shock that I'm reluctant to do the process for myself. I have found myself struggling with where to get started. And it was only after talking to my husband about my thoughts and frustrations that it hit me. I need to follow my own advice. What would I tell a client to do to prepare for their first employee?
So, let's get started on going from solo to a team...
Step 1: Create a Task List
The first thing to consider is, what the employee will be doing. Before we can even say this is a full-time or part-time position, we need to be realistic with what we need to be delegated and how much time this would take for someone. And this is a completely subjective idea...how much time would it take someone. Every person is different. It really boils down to what are your expectations of how much time it should take. Of course, experience, education, and knowledge come into play here as well so this helps you build in these pieces too.
So - start with a list of things you could have the person do. Next, write down how much time you would realistically expect your employee to complete the task and how often (daily, monthly, quarterly, annually). Lastly, determine if this is a full-time or part-time position. And if the position is an exempt or nonexempt position.
Consider remote work for this position. And consider if this is work a virtual assistant can help you with. Many virtual assistants are freelancers and not employees but it could be a really good stepping stone for completing administrative work. If you are considering remote work for your employee, you will want to have a carefully drafted remoted work policy for this individual to protect yourself as well as the employee.
Step 2: Determine a Budget
Solopreneurs need to know what an employee will cost the company, if it is sustainable, and what is the ROI (return on investment) of that hire. In the previous step, you considered if this person would be part or full-time, great start! This will help you narrow down a weekly paycheck.
Here are some key cost categories to consider:
Salary/Rate of Pay - Determine how much you will pay for the position. Some great tools are the BLS (Beauru of Labor Statistics) website, industry-specific publications, and you could use Indeed, Glassdoor, or Salary.com but be careful because these could be slightly over-inflated.
Taxes - What will you pay in FICA (Social Security and Medicare = 7.65%), FUTA (Federal Unemployment Taxes = 6% on the first $7,000 paid to each employee annually), SUTA (State Unemployment Taxes = state dependent - NH).
Worker's Compensation Insurance - Detemine this rate by reaching out to your trusted insurance agent. There are many agencies that will underwrite WC coverage for your small business. Beware that depending on the position, depends on the rate and code you are assigned. Here is a good resource to get started.
Fringe Benefits - Do you want to offer paid vacation or PTO? If so, what does this look like? What is the potential liability? And, know you need a detailed time off policy before getting too far ahead. Vacation or PTO needs to be noted on an employee's offer letter.
Insurances - Will you be offering any medical insurance? This could include QSE-HRA plans, medical plans, dental, vision, group term life insurance, disability insurance, and retirement (401k or Simple IRA). By speaking with a broker you can determine what is the best fit for you.
Now that you know what the position will cost. Think about how adding this cost will bring you more business. Will it? Or will it allow you to build your business the way you want to?
Is this position sustainable? What you don't want is to let someone go as soon as they start with you because you can no longer afford to pay them.
You now have a great recruiting tool too.
Step 3: Recruitment & Onboarding
Posting the position is one of the easiest parts of the process. Now that you have a list of tasks, and know the pay and benefits (if any) you can post the job on Facebook, Indeed, your website, Instagram, wherever fits well for your business. Don't forget to add the 'hidden' perks. Like the kind of culture, you are looking to promote at your company. Opportunity for growth is huge. And what a day in the life of an employee at your company looks like.
Make sure you interview thoroughly. Don't be too hasty just to make the hire. You will want to make sure they are the right candidate. Ask for references and check these references. Ask compliant questions. And it is a good sign when the employee asks you questions!
Once you found your person, it is time to make the offer. Allow the candidate to work out a 2-week notice if they are working for another employer. On the employee's first day, they need to complete their onboarding paperwork (sign the offer letter, job description, emergency contact form, W4, I-9 Employment Eligibility Form, direct deposit form, and any policies). Make sure you have the appropriate labor laws posted.
Step 4: Training & Coaching
So, now your employee is hired! But your job is not over. Be sure to train the individual in all aspects of the position. Check-in regularly. And most importantly, be available for the employee.
Self-training - This is very much an opportunity for you as well. During this time your patience will be tested, your will, your sanity, your expectations, and your ability to be the boss you've always wanted.
Step 5: Separation Process
The employee and employer relationship is a lifecycle and in that lifecycle, we must be prepared with an exit strategy. Sometimes the employee is not a good fit or is not meeting expectations. Whatever your (non-discriminatory) reason, make sure you know how to terminate correctly. Make sure you have documentation behind your reasoning in their personnel file. All employees must be paid within 72 hours of termination so have their paycheck ready. And have your 'script' prepared.
Hopefully, this read has been of some guidance to you. I know writing it has provided me with more clarity on the next step I need to take.
Some kind words of caution: don't go on this journey alone. I have seen many employers large and small fail to execute critical compliant pieces of the process and land in hot water with the DOL. Always turn to your HR manager or consultant for guidance on the process. If you do not have a consultant, reach out today!
Download your free guide to "Hiring Your First Employee" here.