Over the years of working with and counseling small business owners, the team at Hudson Legal has recognized a somewhat warped mindset toward hiring employees. Many brilliant and successful entrepreneurs view the expenses involved in hiring an employee as just that — expenses for “outsourcing” duties and responsibilities they simply don’t have the time to do. We understand the impulse to preserve capital, but a well-trained employee will bring in high ROI and more than recoup his or her pay. Employees are assets to your company.
To help calibrate your mindset, think of hiring an employee as an investment strategy. The more due diligence you perform up front, the better chance your investment will be successful. Once you identify the position you need, the characteristics needed to perform well in the position, and the process for selecting the right person, you should generally spend at least 30 days training your new hire. The exact time needed depends on the nature of your business and the position you filled, but the costs of not providing your new hire with adequate training will dwarf training expenses.
Your Employee Has Business Costs, Too
If you managed to hire an intelligent and passionate employee, you can be sure that he or she had other (good) options before accepting your offer. Just as you had to weigh the costs and benefits of hiring an employee, your employee had to determine the costs of doing business with you, also. To that end, you need to have the right legal protections in place. That includes having an employee handbook, a hiring-firing policy, a non-disclosure agreement, and a robust record-keeping system.
Employee or Independent Contractor?
One area of employment law that has been getting more attention in the past few years is the topic of worker classification. Workers who are classified as employees enjoy certain benefits in exchange for a certain loss of autonomy. To cut costs, some companies treat workers as independent contractors when they should be designated as employees and receive the full range of benefits usually afforded to employees. Additionally, you should make sure that your salaried workers meet the FLSA tests and other criteria.
Without these legal firewalls in place, you could be opening up your company to costly disputes or lawsuits. The fines alone from an employment infraction could seriously damage your operations.
Why, Then, Go Through the Trouble of Hiring an Employee?
Because, simply, you can’t afford not to hire someone if you want your business to survive and thrive. Is there a significant amount of up-front work you need to do before making a hire? Yes. Will all that work be worth it? Without a doubt. To reiterate, the right employee is never simply an expense. The right employee is an asset and an investment.
Before you grow your team, talk to Hudson Legal to discuss how we can provide value for your company and be your true advisors. Your hard work deserves someone who works just as hard to protect it. Give our team a call at (678) 825-4525; we look forward to speaking with you about your company’s future!
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