When you are on the lookout for staff to expand your business, it is not as simple as putting an ad in the local paper and accepting the first person who shows up. Too many potential employees do their dash right at the outset when they give the impression to their would be boss that they are indifferent and arrogant and feel they somehow deserve to be given the job. Employers need employees in order to be able to expand their businesses but the person who finally gets the nod has to satisfy the employer that he or she is capable of adding value to the business and in doing so increase the businesses bottom line profits.
All employees must be cost effective
No employer will even attempt to increase his or her workforce if it will add to the cost of running the business, unless that cost can be recouped with interest from the efforts to be put in by the new employee. The problem you have as an employee is how can you know which person is to prove better than another. Some people are born with a natural charisma but are bone lazy whereas another might be more withdrawn but able to work unsupervised all day. One thing a boss doesn't want is to have to spend an unnecessary amount of time teaching what has to be done. He or she is therefore looking for a quick learners who have the confidence to use their own initiative when found necessary.
The most important employee traits to look for are self confidence and initiative
The two traits of self confidence and initiative is what you should be looking for in an employee once you are satisfied that the applicant has the necessary qualifications and, experience and this is not as easy as many might think it is. It has been the practice of employers for many years now to outsource the search for employees to a recruiting business. The art or recruiting the right staff for the right business has become highly developed with many aids having been introduced to uncover the applicants personality, character and suitability for a certain position.
This is especially true for government departments and large corporations but small businesses, in the main, still rely on placing advertisements in newspapers, on websites, or listing at the local employment office. However you intend going about finding the right staff to man your particular expansion program there are at least three questions you should ask yourself about first, these being:
- Would you be better served by employing the person on a contract basis, or even hire from a temporary staffing agency? Especially in the immediate future while you evaluate whether the expansion plan is working as well as you anticipated. By doing this you can keep employment costs to a minimum.
- What is the number of extra staff you feel you will need to meet your expansion program without putting unnecessary strain on those already in your employment? It often happens in business that the business owner is so focused on the businesses growing that he or she overlooks the added strain they are putting on their already permanent staff members. You, as a business owner, must ensure that your intense focus on a successful expansion does not overload a workforce already feeling the strain. If you do this you will run the risk of alienating loyal hard working staff members who have worked hard to get the business to where it already is. These staff members may form the opinion they are being 'used' by yourself for your own personal ambitions, not as you see it as a means of making all their jobs more secure. If this type of feeling develops in your workforce you could experience a drop off in productivity and even start losing some of your key personnel. Whatever you decide to do about expanding your business you must take your existing staff along with you all the way by explaining what is taking place and why you are doing it.
- Where do you need help most in your expansion program? It will be of no use to you whatsoever if you employ additional staff simply to make up the numbers. Each extra person you employ must have a distinct role to play, a role that can be measured in productivity terms and evaluated as to its worth. The specific person you employ to fill that role must be qualified to fill it and able to make a noticeable difference. It might be a good idea if the position was filled by a casual employee in the first instance and made a permanent position once your decision has been validated.
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Your two employment choices – contract or permanent employment
Employing additional staff is no easy process as there are many government regulation to attend to. A lot of this additional paperwork will depend on whether your expansion program has included additional permanent staff, or if you have opted to employ contractors. These two ways of employing staff can be treated as two distinctly different ways of handling your official obligations.
Contractors are especially attractive if you need additional skilled labour for a certain period. If this is how you are managing your expansion using this type of help you will need to know the following information regarding their business practices:
- Contractors will invoice you, or your business, for the work they carry out on your behalf. This means you will not have to make up wages and deduct any income tax for the services they provide.
- Contractors handle their own business and expenses. Any contractor you engage with must have an Australian Business Number (ABN) and carry their own insurances.
- Once the contractor has finished the work you gave them to complete for you, your involvement with them ends. There is no annual leave or holiday pay adjustments to be made. All you need do is to pay the final invoice.
- Contractors will not necessarily be working for just you alone. They may be undertaking contract work for many other organisations at the same time. It is quite common for them to sub-contract their work out to others.
- If your contractor employs any other person to carry out the work you want done it will be his or her responsibility to ensure that person is properly paid and covered by superannuation. It is the contractor who is responsible for paying the employee his or her superannuation guarantee and any other benefits.
- Small contractors won't necessarily charge you any GST costs. There is a minimum amount of money a contractor has to earn before he or she has to register for the Goods and Services Tax (GST). Your accountant can enlighten you to what this minimum amount currently is.
Alternatively, employing permanent employees will require the following adjustments in your business:
- Permanent employees mean you have far greater obligations to comply with. You will need to register with the Australian Taxation Office (ATO) so you can withhold PAYG (Pay As You Go) tax from the employee’s salary.
- Make sure the person you employ has a Tax File Number. They will then need to fill out a Standard Choice and Tax File Number Declaration Form.
- It is then your obligation to hold back the amount of tax the employee needs to pay based on the salary paid. You forward this amount to the ATO when you complete your Business Activity Statement (BAS).
- You will have to ask your new permanent employee to nominate a preferred superannuation fund. If he or she declines to nominate any specific fund you will have to set up a default fund to pay their contributions into. You will also have to pay a legislated for amount into the superannuation fund every quarter. You must keep proper records of all contributions made by both yourself and the employee.