Small Business Smarts: The Essential First-Hire Checklist
Part of a series | 2025 HR Trends Series
In a recent video discussion, Victoria Jordan and Laci Buzzelli from ADP explored the essential steps small business owners should take to prepare for hiring their first employee. They emphasized that preparation is crucial, even if hiring feels distant. Key recommendations include obtaining a federal and state employer identification number (EIN) to manage payroll taxes, familiarizing oneself with employment regulations such as unemployment insurance and worker's compensation, and drafting a comprehensive employee handbook detailing workplace policies, conduct expectations, and leave policies. By taking these proactive measures, business owners can focus on finding the right candidate when the time comes, ensuring a smoother hiring process and setting the stage for future growth.
Watch the video: The essential first-hire checklist for small businesses
As a small business owner, the prospect of hiring your first employee can be both exciting and daunting. Before you even start thinking about bringing someone on board, it’s crucial to take the necessary steps to ensure that you are truly ready. Recently, small business owner, Victoria Jordan, spoke with Laci Buzzelli, senior vice president and general manager for ADP Small Business Services. Buzzelli shared valuable insights on what to do before that first hire. Here's a comprehensive guide based on their conversation.
The importance of preparation
Your employees are your greatest asset. They can either propel your business forward or become a setback if not chosen wisely. Therefore, preparation is key. Even if hiring feels like a distant goal, taking the following four proactive steps now will make your transition smoother when the time comes.
1. Obtain essential identification numbers
One of the first steps in preparing for your first hire is to apply for a federal and state employer identification number (EIN). This number is crucial for managing payroll taxes and fulfilling your legal obligations as an employer. Understanding the federal, state, and local tax requirements is equally important, as you will be responsible for withholding and timely payment.
2. Familiarize yourself with employment regulations
Knowledge of unemployment insurance and workers’ compensation insurance is essential. These safeguards protect both you and your future employees. You'll also need to decide how to track employee hours and understand pay frequency requirements that may vary by industry and region. Whether weekly, bi-weekly, or semi-monthly, knowing this ahead of time will ease the onboarding process later.
3. Draft an employee handbook
Having a well-thought-out employee handbook is a significant step in preparing for your first hire. This document should outline your workplace policies and procedures, including:
· Wage and hour rules
· Employee conduct expectations
· Paid and unpaid leave policies
Additionally, if you operate in a physical space, ensure that you've prepared all necessary workplace posters and notices in compliance with federal and state regulations.
4. Regularly update and review your practices
As your business grows, regularly revisiting these materials and practices will ensure they remain relevant and compliant with any changes in laws or business operations. Is your handbook updated? Are your tax knowledge and requirements current?
Focus on hiring the right person
Having all these preparations in place will allow you to focus on the most critical aspect of hiring: finding the right candidate. When the time comes, you want to dedicate your energy towards selecting someone who not only fits your business culture but also has the skills and passion to contribute to your company’s success.
Conclusion
The road to hiring your first employee can be less stressful by preparing early. By taking these proactive steps, obtaining your EIN, understanding employment regulations, drafting an employee handbook, and regularly reviewing your practices, you'll set yourself up for success.
For more tips on prepping for your first employee, download “Hiring guide for small businesses.” Embrace this exciting phase of growth and remember that your future employee could be the key to unlocking your business's full potential.
About Victoria Jordan
Victoria Jordan is a seasoned entrepreneur and advocate for small business owners, dedicated to providing resources and insights that empower them to thrive in today’s competitive market.
Download Plan, Launch, Thrive: The Small Business Owner's Toolkit today.
Video transcript of “The essential first-hire checklist for small businesses”
Victoria Jordan:
Are you ready to hire your first employee? No. Well, then this video is for you. I recently learned that you should prepare for your first employee before you're even thinking about hiring. Welcome to the first of three episodes dedicated to hiring your first employee. Laci Buzzelli from ADP helped me put together a list of what you should do to be ready for that first hire, even if it's far in the future. How are you doing, Laci?
Laci Buzzelli:
I'm good, Vicky. Thanks for having me.
Jordan:
My pleasure. So happy to have you here. Tell me what I need to know about getting ready for my first hire.
Buzzelli:
Happy to. Vicky, I'm sure you know, but your employees are your greatest asset as a small business owner. And there's a lot to think through to ensure you're hiring a great candidate. It might feel like it's too soon, but you want to have a few things in place long before you even need that first employee. Because when you're ready, you're going to want to hire quickly. If you don't already have one, the first step would be to apply for a federal and state employer identification number, also known as an EIN. This will allow you to properly handle all of the payroll taxes. You also want to ensure that you educate yourself on federal, state, and even local taxes, as it's your responsibility to withhold those taxes and pay them timely.
At the same time, you'll want to familiarize yourself with things like unemployment insurance as well as worker's compensation. Another piece that is really important when hiring employees is deciding how you're going to track their hours. You'll want to learn the requirements for pay frequency in your industry and also the region that you live in, which could require weekly, bi-weekly, or semi-monthly pay.
A huge piece of hiring an employee that you'll want to be prepared with is to prepare an employee handbook. This will include things like your workplace policies and should include wage and hour roles, how you're going to track their time, conduct expectations of your employees, and things like paid and unpaid leave. Also, if you have a physical space, you want to ensure that you have any required workplace posters and notices that are ready to be displayed. That includes federal, state, and even sometimes local. So I know that's a lot, Vicky, but it's really important. And as I said at the beginning, your employees are your greatest asset. So you want to make sure you're prepared ahead of time.
Jordan:
Yeah. And you know, I think we've all been through a rushed or maybe not thorough onboarding process. It feels like if I get through all of this in advance, then I won't have to rush when it's actually time to hire someone, and I can focus on who that person is going to be versus trying to prepare everything else.
Buzzelli:
That's exactly right. You want to make sure that your focus when it's actually time to hire is on finding the right person that's going to fuel your small business and is the right employee for you.
Jordan:
Thank you so much, Laci. This is great information for small business owners out there. For more tips on prepping for your first employee, check out ADP.com/Hiring101.
