How to Hire the Right Employee for Your Small Business

May 22, 2020
4 minute read

Being your own boss is perhaps one of the most rewarding parts of running your own business. But, as you become more successful and your company becomes more profitable, you might consider hiring employees to help offset your daily business activities.

Deciding who to hire can seem daunting–this is a company that you created, after all, and you don’t want just anybody representing your brand. So, how do you hire employees for your small business?

This article will offer a step-by-step guide to narrowing down your search for the ultimate staff to join the business.

Why should you hire employees?

Before you start searching for the right employee, you need to consider why hiring an employee, or employees, is a smart move in the first place. Expanding your team is an opportunity to further grow your business, but it also means you’ll need to invest in the proper onboarding tools and training, so that your employees are set up for success in the workplace.

New employees also bring a depth of new talent to the business. For example, if you’re the founder of a brand new sanitizing company, you likely possess all of the qualities to execute the business plan, but are you trained and educated in chemicals and cleaning? Hiring a professional cleaner or sanitizer will only enhance your business, as these new employees have talent, skills, and capabilities that are unique from your own.

Things to consider prior to hiring

There are several things to keep in mind before you hire your first employee. It always costs money to make money, and in 2021, the average cost to hire an employee is very broad. Besides spending money to post the job to a job board, you should also expect to spend money on training and onboarding as well as the employee’s salary (which includes any bonuses or commission).

Consider the following before making your hiring decision:

Register for a business number: In order to legally operate in Canada, all businesses require a business number. You can obtain a business number through the Canada Revenue Agency online or by calling 1-(800) 959-5525. Once your business is registered, you can actually recruit new employees for free by using the Government of Canada’s Job Bank. Simply sign up with your payroll number to start posting jobs and attracting top talent.

Review and understand employment standards: There are various provincial and federal employment standards that vary across Canada. These employment standards include information and regulations on topics like minimum wage, statutory holidays, overtime pay, vacation days, leave of absence, and more. It’s important to familiarize yourself with these conditions, and keep a record of them so that you may refer to them often.

Decide on employment type: Will you require a part-time, full-time, contract, freelance, or temporary employee? There are many different kinds of job types in Canada, and whichever you choose will influence your role and responsibility as an employer.

How to find employees to hire 

Hiring employees for your small business is a multi-step process. 

Refer to the following steps to get started:

Create a job description: Outline the role and its required responsibilities. The job description should outline the skills and experience required for the position, including the job title, a clear description of the duties, any soft skills or education requirements, application deadline, as well as information on how to apply. Along with the employee’s responsibilities, the job description should also outline the qualifications of the person you are looking to hire. For example, does the role require a post-secondary education? Does the individual need to possess strong communication skills? Try to be as detailed as possible to attract the right talent.

Post the job online: There are a number of different platforms that allow small business owners to post their job openings. You can advertise your job for free on social media platforms like LinkedIn or Facebook for Business, or you can allocate a budget for paid postings. 

Review and hire: Once you’ve posted the job, it’s time to review applications. There are a number of criteria you can use to evaluating a candidate: Does the person’s experience match the job requirements? What qualifications do they have? How long have they been in similar roles? Are the resume and cover letter tailored to your posting? Are there grammatical errors? Create a “yes,” “no,” or “maybe” pile as you review each application. Once you’ve narrowed down your choices, you’ll need to start the interview process. This allows potential employees the ability to expand on their qualifications as they appear on paper, and it also allows you to get a better sense of their personality. Hire the individual that you feel will be the best fit for your company. This includes their qualifications, their skillset, their future goals as they align to your business model, and how well you think they’ll fit in with your existing business model and culture.

Your responsibilities as an employer

Just as employees have their designated tasks, as an employer, you have responsibilities as well. There are a number of financial obligations that not only ensure that your business is operating legally, but protect you from defamation or legal action as well.

Part of your employer responsibilities will include:

  • Verifying your employee’s Social Insurance Number (SIN) card within three days of employment.
  • Have employees fill out the required tax forms, including the federal TD1 and provincial TD1 form.
  • Set up a payroll account through the CRA. As an employer, you are required to collect, remit and report on payroll deductions for EI, Canada Pension Plan (CPP) and personal income tax.
  • Maintain tax records. Employers must keep payroll and employment records for employees for at least 36 months.

Okay, that helps. If someone is self-employed, then you (as an employer) don’t have responsibilities the way you do with an employee (even if that employee is a contractor). So I can include a little to explain that and how if you’re hiring someone who is self-employed, you’re not paying making tax deductions, EI or CPP contributions, paying stat holidays, vacation pay, etc.

As your business grows, there’ll be a need to hire staff, either temporarily or permanently. Finding the right talent is critical. So make sure to get the hiring process right.

Ready to start your business? Ownr has helped over 40,000+ entrepreneurs hit the ground running quickly—and affordably. If you have questions about how to register or incorporate your business, email us at [email protected]

This article offers general information only, is current as of the date of publication, and is not intended as legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. While the information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by RBC Ventures Inc. or its affiliates.

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