Business to Business: Hiring Your First Employee
Hiring your first employee is a major milestone when you're a small business owner, but finding the most qualified employee can be far more challenging than posting a job opening, interviewing a few candidates, and extending an offer. Because finding the right candidate for your company's unique goals, staffing needs, and culture is so critical to your success, it's important to control as many variables as you can in the hiring process.
Below, Paychex clients have shared their insights on hiring your first employee that are based on their own professional experiences.
Define exactly what the role entails before you post the job. You're hiring your first employee because you need help, but it’s recommended to develop a clear plan for exactly what the role and its duties will entail before you post the job. To identify the details that will shape your job description, spend time answering questions such as:
- What specific duties and essential functions will the role entail?
- What skillset, education, or experience will the person need to succeed in the role and add value to your business?
- Where will the person work, and during what hours?
- What tools, software, or technology resources will the employee be provided to do the job?
- Is travel required?
- Is there the opportunity to advance?
- What will the total compensation package be?
The more granular your job description, the better you can maintain parameters around the types of skills or experiences you'll consider as a minimum requirement, so you can quickly weed out employees who lack the necessary skills. The more detailed you are in your description, the more likely it is that you can attract applicants who are qualified, eager, and excited to help your small business succeed.
Once you've gathered all relevant information, Eric Podevels, CFO at Slate Medical LLC, recommends comparing the job description you've created with your business plan to ensure that your goals, objectives, and budget all align with the role. "Research — what is the business plan, potential customers, profit margins, etc. before making the commitment to hire an employee," says Podevels.
If you can't afford to hire at the upper range of a position's average salary, remember that non-financial benefits may be valued just as highly to job candidates.
Identify the salary and benefits you can afford to offer. If you post a job without a clear idea of the salary and benefits you can offer, you could risk being wooed by a candidate who may be exactly the type of person you want, but can't afford. Once you've crafted the job description, and identified the essential functions, skills, and minimum experience required, you'll have a framework to conduct competitive research about salary ranges for the position, based on regional and national salary data.
Though you ultimately determine the salary and benefits you'll offer a candidate in the formal job offer, Jennifer Gardner, corporate controller at The Copley Consulting Group, Inc., notes that the adage "you get what you pay for" can apply when hiring your first employee. "Sometimes you may need to pay a higher salary for the most qualified candidate, and it is worth it! The cost of hiring an unqualified employee for the role, then having to let them go and replace them – or keeping them on at the cost of efficiency, quality, etc. — is far worse than the cost of paying to hire the most qualified applicant to begin with," says Gardner.
If you can't afford to hire at the upper range of a position's average salary, remember that non-financial benefits like a flexible work schedule or remote work arrangements, extra vacation time, and even the opportunity to perform creative, fulfilling work may be valued just as highly to job candidates.
Don't take the candidate's word at face value. Hopefully, all the candidates you interview will be honest about their experiences and employment history — but several of the clients we’ve spoken to stressed the importance of conducting a thorough background check before extending an offer. "Take the time to carefully check their references. Too often people can sell themselves in the interview, but had you taken the time to check their references or ask further questions outside of the interview, you may have found out a whole different story," says Debbie Keyser, financial administrator at Chariots for Hope, Inc. Just make sure that you comply with applicable federal, state, and local laws and regulations regarding background screening.
Hiring your first employee is an exciting milestone for your business. It’s important to take the time in finding the most qualified candidate who can help take your vision to the next level.
Looking for more? Start-Up Guide: Hiring Your First Employee describes the key tasks necessary to hire and pay your employees.