The "Nitty Gritty" of Hiring (and nurturing) An Employee

28 Jul 2020 2:40 PM | Start. Law (Administrator)

You’ve found the perfect candidate for your growing business. But your work’s not done yet. Here’s how to put the red tape in your rearview mirror and concentrate on building success with your new team member.

  • If you didn’t do this when you incorporated, apply for an Employer Identification Number (EIN) (IRS Form SS-4). You’ll need this for tax forms.

  • Register with your state’s department of labor. As an employer, you’ll have to pay into the state unemployment fund.  (Don’t worry, it’s not a big expense.) 

  • Get Workers Comp Insurance (required in most states and wise in all), even if you have only desk jobs

  • Have your employee fill out IRS Form W-4, Withholding Allowance Certificate.

  • Set up payroll: you’ll need to withhold federal, state, and perhaps local taxes based on the W-4 and also make regular Social Security and Medicare payments to the IRS.

  • Fill out Form I-9, Employment Eligibility Verification, and keep it on file for 3 years. You need this form for ALL employees.  

  • Report each new employee to your state’s new hire reporting agency. (States use this to locate parents for child support payments.)

  • Post any required notices in your office.  You can find Federal notices here 

  • File IRS Form 940 for any year in which you either 1) paid wages of $1,500 or more in any quarter or 2) had an employee work for you for 20 or more weeks of the year.  (The weeks need not be consecutive.) 

  • Make sure you comply with the requirements of the Occupational Safety and Health Act (OSHA).

  • Set up any benefits you will offer: health, retirement, vacations, disability, etc.

  • Create an Employee Handbook.  Your business is not too small!  Having company policies in writing avoids awkward conversations. Templates are available online, and you can add to your handbook as your company grows.

If you want to outsource most of this try Gusto.com You answer a few questions, they create the forms and file them.  Their customer support is excellent too. 

If you need legal advice on this or other matters, schedule a free 20-minute chat with us.

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