What steps do I need to take when hiring an employee?

CosmoLex Team

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Because hiring an employee can be an intimidating and complicated process, it is best to break the process into smaller, more manageable steps as follows:

hiring

  • Analyze your firm’s needs for an employee[1]:
    1. Do you need a part-time or full time assistance?
    2. Would you be able to fill your needs with an independent contractor instead?
    3. Can you afford to pay for an employee or independent contractor?
    4. If the work does not need to be done at your firm’s physical location, you may want to consider using an independent contractor since that means that you aren’t responsible for payroll taxes, benefits, or incentives like you might be for an employee.
  • Determine the pay rate, benefits and incentives[1][2]:
    1. Will you pay an hourly rate or a salary?
    2. What will the hourly rate or salary be?
    3. Will you offer benefits such as paid vacation, sick time, general paid time off, health insurance, or retirement?
  • Create An Employee Handbook[3];
    1. Determine the employment rules for your law firm including items such as:
      1. What hours will the employee be expected to work?
      2. What is the process for calling in sick?
      3. How does the employee request vacation, sick or paid time off?
      4. When will your employee be eligible for any benefits and incentives offered by the firm?
    2. Write these rules down and have your employees sign an agreement to follow the rules as a condition of employment.
  • Recruit your employee[1];
    1. Determine the most important skills you are looking for in an employee or contractor;
    2. Figure out the position’s responsibilities and create a job description and title;
    3. Reach out to friends and family to see if they know anyone who might be a good fit for the job;
    4. Draft an advertisement;
    5. Decide where to place the ad, e.g. on Facebook, Linked In, Craigslist, or Indeed, etc.
    6. Review resumes and cover letters and select candidates to interview;
    7. Determine what questions you will ask the employee in the interview;
    8. Ask for, and check references;
    9. Select you employee or contractor and send a written offer of employment; and
    10. Consider using a recruiting company to help you with the process.
  • If you decide to hire an employee rather than a contractor, know your federal and state payroll administration requirements[1][2][3]
    1. Sign up with the IRS for an Employer Identification Number if you don’t have one;
    2. Have your employees complete and sign all forms required by the IRS;
    3. Sign up with state and local agencies and report your new hire;
    4. Determine how you will calculate the federal and state withholding and the employer payroll taxes for your employee’s paychecks;
    5. For each payroll, withhold all federal and state employment tax amounts, track the withheld amounts, and submit them to the proper state and federal agencies as required;
    6. Consider using a payroll service such as Gusto, Intuit Payroll, ADP, Paychex, etc. to manage your payroll for you (these services will issue the paychecks, withhold all taxes, calculate and collect the employer’s payroll tax obligation from your firm, and issue and file all federal and state payroll tax returns on your firm’s behalf);
    7. Hang all employment posters in your physical location as required by federal and state law.

References

1. How to stay compliant when bringing on new employees
2. Hire and manage employees
3. Hiring Your First Employee: 13 Things You Must Do