Some of my most recent clients were small businesses with questions relating to hiring staff. Whilst there is a raft of information out there it can be difficult to sift through to determine exactly what is required when hiring your first or subsequent employees. If you are a busy sole trader or small business owner thinking about hiring your first employee this blog will help you understand what is required to bring them on board and have them hit the ground running.
Your people should be your greatest asset. After all they are the ones your customers will interact with, so it is really important they fit with the culture you're creating for your business. You don't want someone lacking in enthusiasm whilst being an ambassador for your business! For guidance on the recruitment process you can read our earlier blog article Employing people the right way.
There are a number of things to consider before you make the leap and start recruiting. Don't think of hiring an employee as a one-off event! In the first instance you will need to consider what type of employment is best suited to your business right now. Is it a full-time, part-time, casual employee or a contractor that you need? Each of these employment types come with various terms and conditions so you should think carefully about the type of work your employee would be performing, hours required to fulfil the requirements of the position and the longevity of the role. If you are facing a particularly busy period but can't see this continuing into the New Year, employing a fixed-term employee would make more sense than hiring a permanent employee.
There are numerous Government websites available to assist in determining the correct type of employment.
What to consider
The Fair Work Ombudsman has a great resource you can access to help guide you through the process of hiring an employee. It can be found at Guide to hiring new employees - Fair Work Ombudsman. The following is an excerpt from this document.
There are a number of conditions that apply to all employees employed in the national system and these are known as the National Employment Standards (NES). You will need to determine what Award (if any) your employee would come under and know your responsibilities under the Fair Work Act 2009. Employees not covered by a specific award are still entitled to the national minimum wage and the NES.
Rates of Pay
Rates of pay vary depending on the award your employee is employed under. They are based on the employee's duties and other things like experience and qualifications.
Record-keeping and pay slips
You must keep written time and wage records for each employee. This includes records about:
National and State laws cover equal employment opportunity and anti-discrimination in the workplace. Employees or potential employees cannot be discriminated against because of their race, colour, sex, sexual preference, age, physical or mental disability, marital status, family or carer's responsibilities, pregnancy, religion, political opinion, national extraction or social origin.
Taxation and Superannuation
Under the Pay as you go (PAYG) withholding rules, you have an obligation to collect tax from payments you make to employees and some businesses so they can meet their end-of-year tax liabilities.
Generally if you pay an employee $450 or more (before tax) in a calendar month you have to pay super guarantee (SG) on top of their wages.
The Superannuation Guarantee is currently 9.5% until 30 June 2018.
Workplace health and safety and worker's compensation
It is your responsibility to provide a healthy and safe workplace for your employees.
If you employ a worker in the NT you must arrange a workers' compensation policy through a Northern Territory approved insurer.
In Queensland you need to insure your workers through WorkCover Queensland, unless you meet certain criteria and can self-insure.
What to give your new employee
For your new employee to understand their rights and responsibilities, it is recommended they receive:
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