|At Vancouver 2010 Olympics Opening Ceremony (click link)|
(1) Types of Business Organizations
(2) Business Product to sell and manufacture and service to perform
(3) How to keep business records
(4) Planning to have employees or sub-contracting
(5) Year-end Requirements
(6) Dealing with the taxman (Canada Revenue Agency)
(7) Preparing for the next fiscal period
Now, I will be writing about the fourth item, “Planning to have Employees or Sub-contracting”.
If the hiring process is done properly, all parties involved will definitely benefit from the hiring.
Depending on the business type, size, product or service that the company provides, hiring an employee might not be applicable to all businesses. However for those that need to hire, the following are important suggestions on Hiring Employees or Contractors.
|At Vancouver 2010 Olympics Ceremony (click link)|
a) Have a company’s policies and guidelines manual on hiring employees or/and contractors
b) Do regular evaluation and continued monitoring on new hires
c) Retention of good employees/contractors
d) If the business does well, take time to show your appreciation
Have a Company’s Policies and Guidelines Manual on Hiring Employees or/and Contractors
Establishing a good company’s policies and guidelines on hiring an employee or contractor will likely include: (1) questionnaire (2) cost analysis schedule (3) payroll information and (4) company’s policies manual for new hire.
The questionnaire will likely include questions like these ones:
- Does the company really need to hire?
- Will the new hire be an asset to the company?
- Does the company have policies and guidelines on hiring and terminating new people?
- How long does the company want to keep the new hire?
- Can the company offer the new hire additional incentives if they want to move up?
Furthermore, it is important to include a cost analysis schedule for each prospective employee. Cost analysis schedule will likely include other related cost during the hiring process and once hired. This schedule can show the employer the advantages and disadvantages of hiring a new employee or contractor.
This cost analysis will likely include payroll information of the employee and employer. Payroll Information will include employer’s amount of wages and taxable benefits that will be paying to the employee. Items that you normally see on a pay stub of an employee (this is more applied for at least a mid-size company) are: (1) Gross Earnings - includes: Regular Pay, Salary, Overtime, Commissions, Vacation (Paid out), and Taxable Benefits; (2) Payroll Deductions – includes: Income Tax, CCP contribution, Employment Insurance, Union dues, Medical Plan, and Registered Pension Plan Contribution.
Depending on the numbers of people in your company, payroll accounting can be time consuming, thus some companies use other payroll service company and have their payroll done for them. But if you are planning to do your own payroll accounting, having the required information makes payroll work a lot easier. First, contact the governing agency that has the most current information about doing payroll. Like in Canada, you can contact Canada Revenue Agency (CRA) for Employer’s Tables and Guides for Source Deductions (Income Tax, CPP, and EI).
There is no guarantee that both employer and employee or contractor will have a 100% success as the result of the hiring. However, by having these policies and procedures, the company will have more chances that it will turn out well, especially if both parties have done their end of the bargain, agreed during the hiring process. Though it is not mandatory, but it is advisable for both parties: employer and employee to have a written employer-employee contract. I think it is a good start of having a long lasting successful employer-employee relationship.
Once an employee is hired, a company should implement a “buddy system” with the new hire during the probation period (at least 3 months) since every workplace is different on how they do things. A manual on company’s policies and guidelines for a new hire is another way of getting to know the company and what are expected from the new hire.
|Vancouver 2010 Olympics Opening Ceremony (click link)|
Besides on having a cost analysis schedule per employee during the hiring process, it is also good to have a regular evaluation and continued monitoring system as part of the company’s internal control. Employees are considered as added assets to your company, thus doing a regular evaluation on their performance will only benefit your company.
Likewise, this is also the employees chance to communicate with the company as well. Regular evaluation is the best time to communicate, especially if the new hire is not meeting the expectation yet. You can suggest on improvements and best way of doing things with the company as a whole. Employer-employee relationship is sort of like a team. If the company does its share and so as the employee, both will be successful. The company can enjoy good profit, and at the same time the employees can keep their jobs.
Retention of Good Employees or Contractors
Each time a company hired a good employee, it is considered as an added asset to the company. Can you imagine of not having any help, and the type of your business, you need to have at least a full-time sales person, service personnel, receptionist/ administrative/ data entry personnel or a bookkeeper? As a sole owner you might be able to do all of them, but your success of doings things and expanding your business will either be limited, slow or not be so well. Thus in this case, hiring an employee or a contractor is more like an advantage to the employer. So once you find good employees, try your best to keep them.
If the Business Does Well, Take Time to Show Your Appreciation
When the business is doing well, probably it is because you have a good demand of products or services that your company provides. Of course, part of this success comes from the result of your good employees’ (if you have any) hard work. Most employees are always thinking for the best interest of the company, since they want to be employed at all times, especially with a good employer like you. As an employer you might be busy at all times, but take time to show appreciation for the hard work that your employees do. Besides of their regular wages, if it is not too much for the company, you can either give your employees an additional benefit. It can either be a small monetary bonus on Christmas, or even a small amount of gift certificate, or even an occasional company picnic party. These small little things make your employees feel like their hard work are appreciated by the company. It is the thought that counts.
However, when the company is having tough times, good employees are hard to let go. Have an open communication with your employees before letting them go. Give them some options, for instance like lowering their wages or work part-time instead of full-time, just until the business starts picking up. Some employees will rather take a $10 an hour job, less $5 of their regular hourly rate than being unemployed! They know it is just temporary, and likely it will get better, especially if they work harder, and hoping that soon the company will pick up.
|During Vancouver 2010 Olympics Ceremony (click link)|
Note: The continuation of this topic, “7 Basic Things You Need To Know During Start-up Year of Business ” will be continued on next post, “Part 5 of 7: Things to do at Year-end of Business”.
Hope you like browsing the inserted pictures. They came from the 1000s of photos I collected. Also, make sure to "click" all the "caption/wordings" at the bottom of each picture (you'll be surprised where they are linked to!:) They are not related to the topic of this post (of course). I thought it would be nice to insert them, just to give you a break while reading this post. Until then.