Most employers believe that hiring an employee will give them
extra time to focus on generating new clients, developing product
lines and growing the business, but Robert W. Wendover, author of
Smart Hiring: The Complete Guide to Finding and
Hiring the Best Employees, says the opposite may be true.
"Having an employee actually takes time away from your
work," he says. "In addition to your regular job, you
have added a management role. There are things that need to be
done, like day-to-day supervision, answering questions and payroll,
that were never issues before."
Minssieux knew there would be extra paperwork involved in hiring
employees, so prior to bringing staff into his homebased business,
he researched his options for payroll and benefits services. Though
he pays close attention to his bottom line, Minssieux believes it
is often more cost-effective to outsource certain tasks. "We
decided to have a third party handle our payroll," he says.
"We could do it ourselves, but it is much cheaper to
outsource."
TimingCube also offers its employees benefits, which Minssieux
researched thoroughly. "I talked to my accountant and weighed
the options and decided the Simplified Employee Plan IRA was the
easiest plan to set up because there is very little
paperwork," he says. "The plan was set up through a
brokerage firm, and all I have to do is write a check."
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Minssieux knew it would be difficult to find an affordable
benefits plan with only four employees but was determined to find a
way to cover benefits for his staff. "I decided to let the
employees choose their own [individual] plans, and I pay for
them," he says. This nontraditional approach has allowed the
company to provide health insurance to its employees at a much more
affordable price.
Obeying the Law
Hiring an employee is an extremely important step, and it's
essential to make sure everything is done legally. Experts suggest
following several key steps before hiring an employee to work in a
homebased business.
"First, make sure the employee is qualified to work in the
United States," Cunningham warns. "Ask them to provide
copies of their [immigration documentation] and their Social
Security card [to verify their eligibility]."
Additionally, homebased business owners should also check with
their insurance agencies to ensure they are covered to have
employees working in their homes. "In some cases, depending on
the state and the number of employees, a homebased business owner
has to purchase workers' compensation insurance or change [his
or her] insurance policy to have employees working in [his or her]
home," Cunningham says. "Call your insurance agent to
find out what coverage you need."
Cunningham also advises employers to check local laws pertaining
to hiring employees in a homebased business. "In a lot of
cities, it is not legal to have an employee in your home," she
says. "Homebased business owners have to check with the city
before bringing someone in to work in their homes."
Cohen-Fyffe checked to ensure that there were no zoning laws
restricting her from hiring employees to work in her homebased
business-and then she talked with her neighbors to ensure they felt
comfortable with the additional traffic that her business
generated. "I felt it was common courtesy to let my neighbors
know about my business," she says. "I wanted them to feel
comfortable coming to me if they had any concerns."
The laws pertaining to minimum wage, benefits and insurance
apply to almost any type of business, including homebased
businesses. Cunningham suggests visiting your state's
Department of Labor office to get a copy of your state's
employment laws: "In reality, except for some oddities that
exist in a homebased business," says Cunningham, "you are
still hiring an employee and you still have to follow all the basic
rules."
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