As your business starts to gain traction, there comes a pivotal moment when you realise that it’s time to bring more people on board. Hiring your first employees is an exciting milestone, signifying growth and the path to stability. It’s not a decision to be taken lightly. Hiring can make or break your precious business.
This article will explain the various factors you need to consider when hiring your first employees. If you are a BAS agent ready to take your practice to the next level, read on to know more about the ins and outs of the hiring side of business.
The benefits of a strong team of people
Hiring right from the start can set your organisation apart from the competition. Here are some key benefits of having a strong team:
Increased productivity and creativity
Building a team that performs synergistically increases productivity. Your team members will ideally work together towards shared goals and support one another in completing tasks. They may argue or disagree at times, but a resilient team will be able to turn their differences into creative inspiration and generate fresh solutions together.
Better decision-making
Collective wisdom allows for more informed decision-making and problem-solving. Team members can contribute different viewpoints, analyse risks and benefits and collectively assess options, resulting in well-rounded decisions.
Accountability and responsibility
In a strong team, each member understands their role and doesn’t point fingers when everything goes wrong. They accept blame as readily as they accept credit. They take ownership of their work, meet deadlines, and deliver quality results. This shared responsibility is contagious and fosters a sense of pride, motivating everyone to perform at their best.
Improved client service and satisfaction
When team members are competitive in a good way, they end up falling over themselves to meet clients’ needs faster and with greater attention to quality. They will also be smart enough to coordinate efforts and provide seamless service, leading to enhanced customer satisfaction.
What kind of employees do I want?
Though the type of employees you want to have in your organisation will depend on various factors, there are several desirable qualities that you may want to look out for.
The right employee for the right job
Of course, you will want employees with the necessary skills and expertise required to perform their job effectively. Look for candidates who fit your job description. Start by asking the right questions such as: What job do I need fulfilling? What kind of person would be best for this job? What type of skills would one need for this job?
If you’re looking for people who need to work in a team, consider their personalities before you hire them. Are they suitable for teamwork or do they freeze up when you put them in a room with others? Keep in mind that some people thrive when left to work on their own.
Adaptability and flexibility
In today’s fast-paced and ever-changing business environment, employees who can adapt quickly to new situations and embrace change are highly valuable. You won’t want to hire people who are easily discouraged and quit when situations become dire.
Strong work ethic and loyalty
Employees with a strong work ethic are reliable and committed to achieving high-quality results. They demonstrate professionalism, take initiative, and consistently meet deadlines. You also want someone who shares your vision and works to protect your company from harm, such as bad publicity or client poaching. Although it may be common practice to complain about management, your employees should generally be on your side.
Continuous learners
People who have a thirst for knowledge and a commitment to continuous learning add a much-needed spark of curiosity to an otherwise ordinary office. Hire people who demonstrate a curiosity for how the world works, who love to learn new things, and who appreciate being taught and corrected once in a while. Avoid those who are caught up in their own excessive pride or self-confidence.
Should I hire an employee or an independent contractor?
Hiring an employee and engaging an independent contractor both have their own advantages and disadvantages. Here are some pros and cons of each:
Hiring an Employee
Pros:
- Commitment and loyalty. Employees will generally have a stronger commitment to the organisation since they are part of the team. When treated fairly and given strong incentives, they tend to be more invested in the company’s success and more willing to contribute to its long-term goals.
- More effective supervision. As an employer, you have more control over the work and schedule of an employee. You can provide detailed instructions, set specific work hours, and supervise their activities to ensure tasks are completed according to your requirements.
- Opportunities for skill development. Employees can be trained and developed according to your agency’s needs. You have the opportunity to invest in their professional growth, which can enhance their skills and benefit the company in the long run.
- Integration into the company culture. Successful businesses take time to build a strong company culture. Employees become part of this culture, fostering a sense of belonging and collaboration. You’ll know that you have loyal employees when they can personally align with the business’s values.
Cons:
- Increased costs. Hiring an employee involves additional expenses such as salary, superannuation, annual leave, sick leave and payroll taxes (if applicable). Your business will also typically shoulder the equipment, tools, and assets required to complete their work, such as office space and laptops. In some cases, employees may purchase their own equipment but their employers generally reimburse them.
- Administrative responsibilities. With employees, you must handle various administrative tasks, including payroll, tax withholding, benefits administration, and compliance with employment laws and regulations.
- Limited flexibility. Once an employee is hired, there may be more challenges in adjusting their work hours or tasks to accommodate fluctuating business needs. Employees typically expect a more stable and consistent work arrangement. If the employee turns out to be underperforming, it can also be a challenge to terminate their employment.
- Legal obligations. Employing people comes with legal obligations and potential liabilities, such as workers’ compensation, protection against discrimination, and adherence to employment laws. Failure to comply with these regulations can lead to legal consequences.
Engaging an Independent Contractor
Pros:
- Cost savings. Hiring independent contractors can often be more cost-effective since you don’t have to provide employee benefits or bear the costs associated with full-time employment. Contractors will generally shoulder their own taxes and benefits.
- Flexibility and scalability. Contractors offer flexibility in terms of project-based engagements and can be hired on an as-needed basis. You can easily scale your workforce up or down depending on the demands of the project or business.
- Specialised expertise. Independent contractors are sought out for their expertise in a particular area. They bring specialised knowledge and experience to the table, which may include knowledge they’ve gathered while working for your competitors.
- Reduced administrative responsibilities. Engaging independent contractors typically involves fewer administrative obligations compared to hiring employees. Contractors are responsible for their own taxes, insurance, and other business-related matters.
Cons:
- Lack of control. As independent contractors work autonomously, you have limited control over their work methods and schedule. Contractors may have multiple clients and prioritise tasks accordingly, which may mean that you’ll be waiting on their availability.
- Potential misclassification risks. Misclassifying a worker as an independent contractor when they should be classified as an employee can lead to significant legal and financial repercussions.
- Limited commitment. Contractors may not have the same level of commitment or loyalty as employees since they are typically hired for short-term projects or specific tasks.
- Representation and branding ambiguities. Unlike your employees, you have very little control over how contractors behave themselves. For instance, you may be very specific about how your employees dress or whether or not they can smoke while in uniform, but you often can’t expect your contractors to follow exactly the same standards that your employees do.
What to consider when hiring
Nature of position
Depending on the job, you may hire a:
- Casual employee
- Part-time employee
- Permanent employee
Casual employees
Casual employees typically have irregular working hours that can vary week to week based on business needs or staff availability. Casual workers receive higher hourly rates compared to part-time employees.
To ensure fair compensation for casual employees, many are entitled to a 25 percent loading on top of their base rate of pay instead of receiving permanent entitlements.
Casual employees do not receive the same benefits as part-time employees, such as:
- public holiday leave
- sick leave
- annual leave
- paid carer’s leave
- notice upon termination
- redundancy pay
- guaranteed hours of work
Casual workers, however, are eligible for two days of unpaid carer’s leave per year and two days of unpaid compassionate leave per occasion. They are also entitled to paid family and domestic violence leave according to recent changes in legislation. Additionally, depending on the specific state’s legislation, casual employees may be eligible for long service leave.
Permanent Part-Time Employees
Part-time employment closely resembles full-time employment, except that part-time employees work fewer hours. Part-time workers can contribute up to 38 hours per week and enjoy similar benefits to full-time staff, such as:
- sick leave
- public holiday leave
- annual leave
- parental leave, and
- redundancy pay
Part-time workers share similar rights with full-time staff regarding notice of termination. Typically, part-time staff work a set number of hours per week on a regular schedule, providing stability and structure while allowing for some flexibility.
Permanent Full-Time Employees
Permanent full-time employees work regular and ongoing hours. Generally, full-time employees work 38 hours per week or more, have a regular schedule, and enjoy entitlements such as annual leave, sick leave, and carer’s leave on a pro-rata basis. Unlike casual employees, full-time workers have an expectation of ongoing employment, and notice is required to end their employment.
In general, permanent full-time workers benefit from job security, steady hours, and the ability to plan their future with more certainty.
Choosing Between Casual and Part-Time Employment
Selecting between casual and part-time employment depends on various factors, including business structure, industry, seasonal demands, and long-term requirements. Industries like hospitality, events, and retail often rely on casual workers to meet seasonal demand. Start-ups or new businesses might initially opt for casual employment to allow flexibility as the business evolves. Once a better understanding of business requirements is established, employing more part-time employees can enhance staff turnover, productivity, and future certainty.
While hiring casual or part-time employees may seem more economical, they come with some potential hidden costs, including:
- Additional training and onboarding fees.
- Recurring costs for recruitment.
- Costs related to lack of efficiency and poor team collaboration.
- Potential legal and compliance issues if an employee is misclassified as a part-time or casual when they should be a permanent employee.
Cultural fit and personality type
Hiring for cultural fit and personality type has long been a consideration in the recruitment process. It revolves around finding individuals whose values, beliefs, and behaviours align well with the organisation’s culture, with the aim of maintaining its integrity.
Defining your company culture.
This is the first step in hiring for cultural fit. It involves articulating the values, norms, and practices that define your organisation. Clearly convey your company culture in all your hiring materials, including job postings, to attract candidates who align with your core values.
Gather insights using personality tests.
Personality tests have become a valuable tool in the recruitment and hiring process, providing details about candidates that may not be apparent from their resumes or interviews. One advantage of using personality tests is that they reveal a candidate’s natural skills and talents beyond their qualifications.
Understanding these traits helps companies assess a candidate’s potential in real-life situations and identify traits that align with the company’s culture.
Consider diversity, equity, and inclusion (DEI).
Creating an inclusive company culture that promotes diversity and inclusion is beneficial for both the firm and its employees. Discrimination in the workplace is unlawful, even for applicants undergoing the recruitment process. Developing an inclusive recruitment strategy ensures equal opportunities for all candidates.
Knowledge and experience
Hard skills are essential in critical fields like accounting and finance. Though enthusiasm and a willingness to learn can really uplift a new recruit in management’s eyes, knowledge and experience are hard to replace.
Start by clearly defining the knowledge and experience requirements for the role.
This involves identifying the specific qualifications, certifications, technical skills, industry experience, and domain expertise that are essential for success in the position. By outlining these criteria, you can better evaluate candidates and make informed hiring decisions.
Review resumes and application materials.
Carefully assess a candidate’s educational background, previous work experience, and any relevant certifications or training programs they have completed. Look for indications of how their knowledge and experience align with the requirements of the role. Pay attention to the depth and breadth of their experience, as well as the specific projects or achievements they highlight.
Conduct interviews and assessments.
During interviews, ask targeted questions to gauge a candidate’s depth of knowledge and practical application of their skills. This could involve posing hypothetical scenarios or asking them to provide examples of how they have utilised their knowledge and experience in previous roles.
Seek references and recommendations.
To avoid hiring someone who just looks good on paper, request references from candidates and reach out to previous employers or colleagues to gain insights into their previous job performance.
Potential for growth
Look for individuals who demonstrate a willingness to learn, adapt, and take on new challenges. Assess their ability to acquire new skills, handle increasing responsibilities, accept constructive criticism, and contribute to the organisation’s long-term goals.
Keep an eye out for individuals who demonstrate alignment with your company’s vision and goals and have the potential to contribute to its success over the long term.
Your personal assessments
Follow your intuition and gut instincts when evaluating candidates. While it’s important to consider objective criteria, sometimes your instincts can help you decide whether or not you’d feel comfortable working with a person.
After all, you will need to juggle different personality traits and their individual quirks all while handling the stress of your jobs.
As the leader, you need to choose wisely regarding which people you invite into your work life.
Legal considerations
Employment contracts
An employment contract serves as a written agreement between employers and employees, explicitly outlining the terms and conditions of their professional relationship. It removes any ambiguity and sets clear expectations for both parties.
Basic terms and conditions
Clearly outline essential details, such as the employer’s identity, the commencement date, agreed hours of work, work location, reporting structure, remuneration, and notice of termination.
Contracts and Legal Minimum Entitlements
An employment contract cannot offer terms that fall below the legal minimum entitlements defined by the National Employment Standards (NES), modern awards, enterprise agreements, or other applicable registered agreements.
Every employee is protected by the NES, irrespective of whether they have a written contract. It is essential to ensure that a contract does not disadvantage employees in comparison to their minimum legal entitlements.
Pay Secrecy in Employment Contracts
Employment contracts should not include terms that enforce pay secrecy. Recent changes to the law prohibit pay secrecy, as transparency regarding remuneration promotes fairness and equality in the workplace.
Both employers and employees should have open discussions about wages to foster a culture of transparency and trust.
Additional clauses for employer benefit
No one wants to expect the worst, but you may err on the side of caution and include clauses that protect your interests as the employer.
These may cover areas such as confidentiality, intellectual property rights, and post-employment restraints.
Non-compete clauses and restraint clauses
Non-compete clauses and restraint of trade clauses are provisions commonly found in employment contracts that restrict an employee’s ability to engage in certain activities or trade with other parties after leaving their employment.
These clauses aim to protect the employer’s legitimate business interests, such as confidential information, customer connections, and goodwill. However, the enforceability of restraint clauses depends on several factors and must be carefully reviewed before signing an employment contract.
The validity of a restraint of trade clause is determined by a common law test. To be enforceable, the company must demonstrate that it protects a legitimate business interest and that the scope of the restraint is reasonable and necessary to safeguard that interest.
Non-compete clauses, also known as non-competition clauses, go further by prohibiting employees from engaging in activities that directly compete with their ex-employer. This provision can be included in an employment contract to prevent an employee from opening a competing business for a specific period of time after leaving their current employer. It is designed to protect the business from potential harm caused by an employee using confidential information.
A non-compete clause can cover the period during and after employment. It can prevent employees from taking positions that would incentivise them to disclose confidential information or take advantage of customer relationships. It can also prevent employees from soliciting or recruiting clients or customers of their former employer.
Employment policies and procedures
A workplace policy is a statement that outlines how human resource management issues will be addressed within an organisation. It sets expectations for employee behaviour and performance, reinforcing and clarifying standard operating procedures. Policies consist of a statement of purpose and one or more broad guidelines to achieve that purpose.
Types of workplace policies:
- Code of conduct
- Client confidentiality policy
- Recruitment policy
- Health and safety policy
- Non-smoking policy
- Drug and alcohol policy
- Anti-discrimination and harassment policy
Workplace procedures go hand in hand with policies. They are step-by-step instructions or guidelines that outline how specific tasks or processes should be performed within a firm. These procedures provide detailed instructions on how to carry out routine or specific activities in the workplace. They provide clear guidance on how to perform tasks, handle specific situations, or follow certain processes within the organisation.
A well-made company procedure will painstakingly outline the necessary steps, actions, and requirements to achieve desired outcomes.You may feel that workplace procedures are just additional paperwork to read or file. But in all seriousness, workplace procedures help ensure that tasks are carried out consistently across the company, following established standards and protocols. They also ensure compliance with relevant laws, regulations, and internal policies.