Hiring guides for the small business owner

MAT-SU -- As work piles up in the office or warehouse and tourist season approaches, you may consider hiring additional staff. But do you really need more help? Often organization and time management are all that is needed to operate more efficiently.

If you decide a new employee is needed, look first at the operating budget. Is there extra operating cash available? If not, can other expenses be cut to provide the needed funds? And don't forget to consider payroll taxes and other costs associated with an employee. Also clarify if the new employee will bring in additional revenue -- in other words, is the employee going to pay for himself or herself.

Determine exactly what you want the person to do for the business. There are three main steps in the process of finding out what you need in an employee. First, do a job analysis by gathering information and making decisions about the work to be done. Next, determine the qualifications necessary to do the job well, and finally, create a job description that spells out the duties and responsibilities. This process will assist in the interview and hiring process as well as help determine the rate of pay applicable to the job. This is the best way to make sure that you get the right person for the right job.

Beware of the IRS 20-Factor Analysis, if you are debating whether to hire a 'contract' worker or an employee. IRS auditors pay close attention to this issue. If you choose to hire a 'contractor' instead of an employee in an effort to reduce tax liability, you could pay for it later. The IRS Web site can provide access to the 20-Factor Analysis.

Once the word is out that you have an opening, expect to get phone calls, drop-in visits, and resumes in the mail. Create an initial screening checklist to determine if a person has the required qualifications. Decide how to respond to each person. It is a good practice to acknowledge everyone who applies, even if they are not suited to the job. Determine what information is required from each applicant. Will you have a formal application or will a resume suffice? Do you need to give any tests to determine level of competency?

Select a manageable number of applicants and begin the interview process. Formulate interview questions that pertain directly to the job description and ask open-ended questions that require more than a 'yes' or 'no' answer. Ask the same questions of each applicant. Take notes so that you can compare candidates. This is crucial. Don't trust your memory to recall the details of an interview. Make sure that notes could not be construed as discriminatory. For example, assume a male applicant arrives for the interview in a coat and tie, and a female comes in torn jeans and a T-shirt. The reason for rejecting the poorly dressed applicant should read because "the applicant appeared for the interview in torn jeans and a T-shirt," not "the applicant did not have the proper appearance," since this could be interpreted to mean that she was rejected because of her gender.

When an offer is made to the chosen candidate, make sure that the following information is clearly shared: title of the position offered, location and working hours, salary/hourly wage, benefits, start date, papers or information needed the first day -- such as a social security card, and set a date by which you would like a 'yes' or 'no' answer to your offer.

Once the new hire is on board, start a personnel file for the individual. At least a Form W-4 (for payroll withholding and tax purposes) and a Form I-9 (Immigration and Naturalization Service) are required. It is a good idea to also keep the application or resume including name, social security number, and home address. Also keep in mind any additional federal and state employment laws. Go to the Alaska Department of Labor Web site for detailed information or call the local Department of Labor office for assistance.

Take the time to train the new hire in the new position. There is nothing more frustrating for a new employee than to be unable to answer customer questions. Create a training plan and allow time to work with the new person or partner them with an experienced employee. This will benefit not only the employee but the business as well.

While a formal hiring process may seem cumbersome, it offers the best chance for finding an employee who fits the business. This can reduce turnover and lower the cost of beginning the process all over again.