How to Know When the Time Is Right for Hiring Your First Employee

Hiring your first employee is the biggest decision you will have made up to that point with regard to the future of your business. Up until that point, it is all about you, your hopes, your dreams, your income, your family, your future. You can either fail or succeed. But for the most part, you are the only one affected by your decisions.

Taking on your first employee changes the whole complexion of your business. It changes your business in a similar way that having a child changes your marriage. Once you start taking on employees, your business gains considerably more gravitas. Your business is now a grownup, with grownup responsibilities.

Also like having your first child, timing is crucial. Bring on an employee before you are prepared is almost always disastrous. That is why it is crucial to know not just who to hire, but when to hire them. Here are a few questions to consider before making this momentous decision:

Do You Have the Systems in Place to Manage Employees?

Hiring a person is easy. It’s all the stuff you have to do afterward that complicates the issue. Your employee shows up for work the first day bright-eyed and bushy-tailed. Now what? Here are a few of the things that come next before even getting to the hard part:

• Get all of the regulatory documentation filled out and processed
• Orientation
• Workspace assignment
• training
• Accommodating special needs
• More training…

Once your new employee is up and running, you have the Herculean task of tracking and managing their productivity to ensure that as an investment, they are a net gain rather than a net loss.

That’s where professional HCM software comes into play. Human capital management is more than just a buzzword. It is everything to do with managing your human assets from the work they perform, to the space they occupy while performing it. As your company continues to grow, HCM becomes a necessary inevitability.

Do You Have Sufficient Financial Stability?

When you rent something from month to month, you don’t have to worry so much about financial stability. If things don’t work out, all you have to do is return the rented item at the end of the month with no further commitment. When you lease, you do not get the option to just walk away from the deal whenever you please. You are contractually obligated to continue to pay through a specific term.

Hiring vs. temping is a little like leasing as opposed to renting, except far mor consequential. Depending on the state you are in, it might not be possible to just casually let an employee go for no good reason. Your no longer being able to afford it is not a good reason.

It is important that you carefully consider your financial priorities before hiring your first employee. There are ways of bringing in help without taking the step of employment. If you don’t have sufficient capital to sustain the employees you hire for a reasonable amont of time, you’re not ready.

Are You Prepared for Regulatory compliance?

The Department of Labor offers a summary of the major laws relating to having employees. They include, but are not limited to:

• Wages and hours
• Health and safety
• Workers’ compensation
• Benefits
• Unions
• Family medical leave
• ADA

Being out of regulatory compliance can get you shut down just as surely as an outbreak of food poisoning can get a restaurant shut down that very hour. Will your workers have to report to a particular location to do their work? Is that place wheelchair accessible? Can you supply magnification or screen reading software for blind and visually impaired workers? What happens if someone gets injured on the job?

What happens when the one employee you hired gets pregnant and needs time off? What will you do when a male employee asks for paternity leave? Even large enterprise struggles with these issues. If you are not prepared for regulatory compliance, have sufficient financial stability, or the systems in place to manage every aspect of employees, then you are not ready for that responsibility.