This is tricky because there is no perfect time to hire someone, but you do want to start the process before you are ready for them because it can take weeks or even months to find the right person. I usually start 3 months before I want them to be on board, and 6 months before I want them to be able to perform reasonably independently.
There is also a cost to hiring help, so knowing that this is coming might give you time to book a consultation with your accountant, reflect on results to date, and make sure you can afford to get help before you make the commitment.
The first thing I encourage you to think about is what you actually do, each day, week, month and year. Some ideas on how to get clarity on this:
Now think about what you love doing because you’ll want to retain those tasks and responsibilities, otherwise you might end up in a ‘job’ within your own business that you don’t actually enjoy.
Get real on what things only you can do. Often we underestimate staff, and assume we are the only ones who could possibly do things. I get it - I love to be in control, and you are not totally wrong in assuming no one else will do it how you do it exactly. Sometimes we call this diversity though, and it can be a huge advantage - it invites new ideas, encourages more broad thinking, allows for better representation in decision making and enriches the workplace culture.
Finally, prioritise this list. You might feel totally overwhelmed and want to just get someone to do it all for you, but that is probably not realistic. What are the things that you need the most help with regularly, or as a high priority. Get help on these first, and then consider expanding the person’s hours, role, or perhaps hiring additional people over time.
You now have a list of things they can help you with, it is time to write this into a proper job description. This should outline what the role is, key responsibilities, position/title, who they report to, and all that fun stuff.
You might like to also consider, either just for yourself or to put in a job ad, the skills or characteristics or experience they should bring to the table. Who is it you are looking for? I encourage you to be open-minded and consider your own biases.
It is important to check that what you are imagining for this role (pay, hours, entitlements, leave etc.) is in line with relevant laws. The best way to do this is to give FairWork a call or check out their website. They can help you to check what the minimum wage rate is for the role you have in mind, and you can then make a decision on what to pay your staff (this minimum or something above it!), and you can keep working conditions in mind and understand better your obligations as the employer.
Most small business owners I know actually hire friends or family, or find a connection through people they know, or even groups online. Others do advertise on platforms or reach out to recruitment agencies.
Once you have a few candidates, it is time to interview them. This can be anxiety inducing for both you, the future employer, and the candidate, future employee. It is important to consider the time of day, location, making sure everyone feels comfortable, and that you have ample time to check their vibe and ask all the important questions to figure out who is best for the job. There are no right or wrong questions, but if you need some inspiration check these out. You should also ask some questions more specific to the role and to your business.
Woohoo! You found your person. I really wish I could just interview romantic partners too and find my person but apparently, and unfortunately, it doesn’t work that way.
How do you let them know? You could call them or email them or arrange a follow up meeting and tell them in person. Once the official announcement part is done, it is important to get an employment contract written up and signed. I suggest you speak with a lawyer to draw one up. It doesn’t need to be too complicated, but it is an important document worth investing in.
When I hire staff I also like to send them a ‘welcome to The Real Thiel’ gift. Mike, in the Philippines, was my first hire and since family and community is such an important part of his culture and having big celebratory dinners is part of my family traditions, I gave Mike a voucher to take his own family out. I couldn’t be there to celebrate with them but I think a little gift or welcome pack, or even just a special lunch on the first day, can make the employee feel at home right away.
I think it is important to also let the other candidates know that they didn’t get the role. I remember how annoying it was as a young person going for jobs and just never hearing back. It feels rude and also means they might be waiting for you or feeling anxious for longer than necessary. Put them out of their misery!
It can be hard to let someone know they weren’t successful in securing the role. Perhaps use this little email as a base to write your own, or simply give them a call.
Thank you for meeting with me about the [job title] position at [business name]. It was a pleasure to learn more about you. Unfortunately, I'm emailing to let you know that you didn't get the job. I appreciate the time you took to apply and to meet with me, and wish you the best of luck with your job search.
Then you can begin the onboarding process.
This is where the accountant comes in!
When you hire someone, you should go through these key steps to make sure you are compliant and ready to pay them:
Once you have this information, book a time or engage your accountant to help set up the payroll system in your accounting software. We highly recommend (in fact we insist it if you are our client) that you use software once you have payroll demands. It is just far too inaccurate and inconvenient to do manually, especially with single touch payroll which the ATO now requires.
We are developing a special blog on some key tips when setting up employees in Xero. Watch this space!
Here are a few other things you might like to consider:
Make sure you have things for them to do on their first day! The worst thing is when you start a job and have nothing to do and no one to talk to, and all you want to do is learn or help out.
Remember, it is their first day, week, month. Be kind. I suggest that either you provide some training manuals to them on their first day that outline how to use the key systems or what your core processes are. Or, perhaps this becomes their first task! You could show them how to do things, and then their job is to create their own manuals which can be passed on for generations to come.
Don’t forget this one, otherwise they won't stick around too long!
This might be a job for you, or your bookkeeper or your accountant, and it should happen on time, every time, through your chosen accounting software program. If you are using Xero then check out their guides or reach out to us for a training sesh.
For further understanding, there are 3 elements to someone’s pay:
NET PAY (what the employee physically receives) = Earnings minus Tax withheld
You as the employer need to put the Super and the Tax withheld amounts aside so that you have the funds available to pay to the superfund and to the ATO respectively. At the very least you have to pay these each quarter, but we recommend that you do it monthly just to keep on top of it (and so you are not tempted to borrow those funds for other purposes). It is a serious no no to not make those super and tax payments.
I certainly found that while hiring people does help free up your time in one way, it also creates new tasks and responsibilities for you - you are now a manager! Part of this role is supervising, reviewing, and performance management.
Perhaps you have worked for someone else before? It is frustrating to be judged on things out of your control, and it is hard to meet expectations you didn't even know existed. So, be sure to set KPIs (key performance indicators) that are relevant to your employees role and that are within their control, and importantly that reflect values you are trying to instil. Set clear expectations up front (when hired) and whenever work is assigned. If you are feeling like you are doing this already and the employee is ‘just not getting it’ then maybe your communication style could be tweaked. I found some great tools in Dare to Lead (Brene Brown).
I meet with my staff individually each quarter for a pulse check. We send through the blank pulse check agenda ahead of time so they can add notes and we can review and come prepared.
Then we meet for an hour or so and discuss:
People management is constant, and it can be a lot of work at times, but think of your employee like an athlete and you are their coach. The more you put in, train them and guide them, the better their performance will be.
Remember, you can’t just say that someone is a contractor and then not pay their super or pay them a reasonable amount. The ATO has rules on this and a handy tool to help you figure out the real nature of the arrangement. It can be tricky so reach out to us if you get stuck.
At the end of each financial year it is important to double check everything in your accounting software and then to report the payroll information to the ATO so that it will then feed through to your employee’s tax return in the ‘pre fill’. Here’s how to do it:
Only once that is ALL OK do you do these next steps:
Please make sure to continue paying Super each month (or each quarter at the latest).
Please make sure you process pay runs and then make payments to staff, and be sure to pay staff the NET PAY.
Please reconcile bank transactions:
- payments of wages: select the Wages Payable category
- payments of super: select the Super Payable category
Growing your team and your business is an exciting and daunting adventure. We wish you all the very best because when you find the right team everything can flourish.
P.s. here are some other handy links with more info and ideas: https://business.gov.au/people/employees/hiring-employees