How to Hire Your First Employee: 10 Steps to Follow

It’s challenging to decide when it’s time to stop multitasking and start hiring for your business.

On one side, it’s pretty lucrative to have someone assist you and bring in specialized skills in required domains. But then, there are several questions you need to address first. 

Who should I hire? What exactly should they do? How much should I even pay? And wait, does this fit my budget at all?

It’s a lot. But hey, if your business is growing, you’ll have to face it sooner or later. No escaping this one.

To make things easier, we’ve put together something that’ll help you in real time. We’ve curated a step-by-step guide to help you hire your first employee.

In this blog, we’ll cover:

• • The time you should consider hiring someone.
  • What to sort out before you start hiring?
  • The 10 steps to hire your first employee
  • What happens after the hire?
  • And finally, how Remunance can help you breathe a little easier through it all

Alright, ready? Let’s get into it.

Is It the Right Time to Hiring Your First Employees?

Before figuring out how to hire your first employee, you should know when to hire employees. You should be aware when your company needs its first hire. 

You should not jump into hiring too early or wait for too long to take that step. Let’s find out when is the right time is for hiring your first employees.

You’re Overwhelmed by Managing Everything Alone

Your first indicator is if you’re working late and missing weekends and still can’t keep up. Caffeine cannot keep you in a panic.

It’s time to get someone in when your to-do list appears the same at night as it did in the morning. 

You’re Incapable of Taking New Projects

If you’re saying no to new clients or projects because you don’t have enough hours to complete your existing projects, your business has outgrown its one-person limit. And, that’s a good thing. 

It means your business is growing. But hiring someone at this point becomes crucial. Then, you can get both quality and opportunity.

The Wait Time for Customers Has Increased

If you have a long queue of customers waiting for your response and are worried about their slow deliveries, it’s time to know that you’re just maxed out. 

A new hire can help you get back to giving customers the attention that made them stick around in the first place.

You Have a Steady Income Now

If you have a stable and decent revenue coming in and you’re not sweating bills every month, that’s your green light. 

You’re in a good spot to afford someone’s salary without worrying about how to pay rent next week.

You Need Niche Skills and Subject Matter Experts Now

At some point, Google and YouTube tutorials won’t help you with the quality results you want anymore. 

If you need proper design, marketing, HR, and admin, or tech help, it’s time to hire someone who is an expert in their field.

You’re Ready to Have Your Own Team

Hiring your first employee means shifting from you doing all the work to guiding someone on how to do it. Yes. It’s a huge change. You need to process this carefully.  

Take your time, know what your business demands, what will be the future of your workforce and how will you contribute to it. 

Only after considering these factors, try to know about how to hire your first employee. The timing and budget should definitely match with your hiring demands.   

10 Steps for Hiring Your First Employees  

The steps for how to hire your first employee involve deciding on the hiring demands, describing the role you’re hiring for clearly, arranging smooth interviews, etc.

Each of these processes needs precision and careful research. Let’s discuss the steps to hire an employee one by one in this section.

Identify your Company’s Hiring Needs

Don’t start with deciding on the budget. Start with the problem. Are you missing deadlines? Are you turning down work? Do you need a skill the team doesn’t have?

Gradually, start estimating the ongoing cost. Consider everything from salary, taxes to benefits, and tools. This step is crucial when you learn how to hire first employee effectively.

Start Aligning the Legal Activities and Budget Planning

Then comes finalizing your budget. This will include components like salary, payroll taxes, benefits, and hiring costs.

After finalizing your budget, get an EIN for taxes. Register with the state for new-hire reporting. Then, buy workers’ compensation insurance if the state you’re hiring in requires it.

These legal steps are non-negotiable when you’re learning about how to hire employees for a small business.

Write a Clear Job Description

Elaborate on every detail in the job description, but keep it specific. Include:

• • Job title and one-line summary.
  • Key duties in bullet points.
  • Must-have skills and nice-to-have skills.
  • Experience or education needed.
  • Compensation, perks, and career development activities.

A well-written job description makes resume shortlisting easy and helps get hold of the suitable candidates.

Advertise your Hiring Process on the Right Platforms

• • Post on LinkedIn and niche job boards.
  • Use Indeed and your careers page.
  • Advertise across various social media channels.
  • Take employee referrals seriously.

These steps are the building blocks of knowing how to hire employees for a small business.

Screening and Shortlisting Candidates

Use the job description as your filter. Toss obvious mismatches. Do a 15–30 minute phone or video screen. Check communication and real availability. 

Use a simple score sheet so you can compare candidates fairly. These are the practical steps to hire an employee that cut down wasted interviews.

Plan for Integrated Interviews

Set the same level of scrutiny for every finalist. Have a mix of technical and STAR-style behavioral skills in your interview questions. Take notes. Have a fair comparison process. Keep room for candidate questions and feedback.

Conduct Proper Background Verification

• • Check for reliable references.
  • Connect with former HRs or managers.
  • Check with them about their ethical conduct.
  • Make work-related inquiries.

However, you should carry out all these processes by following all the mandatory privacy and local labor laws.

Draft a Proper Offer Letter

After verbally confirming their candidature, send an officially drafted offer letter to the selected candidates. Mention:

• • Job title and start date.
  • Salary and pay schedule.
  • Benefits and probation terms.
  • A deadline to accept or decline.

Be open to negotiation if the candidate is worth it. Finally, ask them to send a signed copy of the offer letter as a sign of acceptance.

Prepare for Day One

Set up the laptop, accounts, and software. Create an email and access. Book a workspace or remote setup. Share the first-day agenda. Tell the team the start date and the new hire’s role. Make the first day smooth.

Onboard Your First Hire with a Proper Structure

The onboarding of your first hire should be both structurally and emotionally correct. Plan training and checklists. Share your mission, values, and policies on the orientation day. 

Assign a buddy or mentor. Set clear goals for week one. Schedule check-ins at 30, 60, and 90 days. Good onboarding improves retention and performance.

So these are some tried and tested methods to have a very effective first hire.

Let’s now move on to the next section, where we’ll discuss the things you should do after the hiring process.

What Are the Major Statutory Employee Benefits in India?

In India, employees get extra support apart from their basic salaries. Companies offer benefits like retirement savings, health cover, paid leave, and even bonuses. 

These benefits keep employees financially safe. Let’s look at each one of them closely.

Retirement and Social Security

This is about building a safety net for the future. The idea is to save while you work and use it later.

• • Provident Fund (EPF): Both employees and employers contribute money every month. It grows into a retirement fund.
  • Pension (EPS): A part of that contribution goes into a pension plan. It helps after retirement or in case of disability.
  • Gratuity: It is a token of appreciation from your employer for your years of service.

Health and Disability

Health problems or accidents can occur at any time. That’s why statutory benefits are important.

• ESI Scheme: Covers medical care for employees and their families.
• Cash Support: Provides assistance to employees on maternity leave, sick leave, or dealing with a disability.
• Workplace Accidents: If employees are injured at work, the law ensures they or their family receive fair compensation.

Compensation and Leave

Employees also get some breathing space and fair pay in between everyday, mundane work life. They are as follows.

• Maternity Leave: New mothers get up to 26 weeks of paid time off.
• Child Care: Bigger companies have to provide crèche facilities.
• Paid Leave: Annual leave, sick leave, and casual leave are all covered by law.
• Minimum Wages: Employers can’t pay below the fixed legal rate.
• Bonuses: Many companies pay extra during festivals as part of employee benefits or perks.

The above list summarizes the statutory benefits available to employees in India. Let’s move on to the supplemental employee benefits in India now.  

What to Do After Hiring Your First Employees?  

After you’re confident about how to hire your first employee, it’s time to learn what steps you should take after hiring your first employee. 

It includes setting up the payroll process and having a proper training schedule for them. Let’s discuss the pointers in detail.

• • Finish off with all the paperwork first. The mandatory documents, like offer letter, NDA, tax forms (W-4 and I-9), should be taken care of as soon as you have your first hire.
  • Set up your payroll process next. Build a system that pays your employees timely and accurately. Automate deposits and tax deductions so you’re not stuck doing math every month.
  • Get your EIN. If this is your first time hiring, you’ll need an Employer Identification Number from the IRS. It’s free and takes five minutes.
  • Check with your benefits and insurance provider. This is a very crucial thing to maintain employee motivation and productivity. Workers’ compensation, health insurance, retirement plan; everything should be considered from day one. You should be thorough with how to offer the best benefits to your remote team.
  • Prepare an employee handbook. It should be crisp but include all the intrinsic details like attendance, leaves, behavior, time-off policy, etc.
  • Stay organized. Create one folder per employee. It can be digital or physical. But don’t store all employee documents in a single common folder.
  • On the very first day of their onboarding, welcome them properly. Don’t just finish with the formalities and disappear. Try building a personal connection with them. It’ll help a lot while working together in the future.
  • Go over their role again. What they’ll do, what you expect, what’s urgent, and what the workflow will be.
  • Try to hand out some attractive goodies as a welcome kit. A coffee mug, notebook, and headphones, with a simple “Welcome aboard!” note, go a long way. Sounds small, but people remember it.
  • Plan for some fun activity for them where they can introduce themselves properly. It helps to break the ice easily.
  • Set short-term goals. Plan for 30, 60, 90 days. What should they achieve? What should be the progress of their work, everything.
  • Talk about your company culture at length. Not the fancy mission-statement kind. The real stuff, like how your team works, what’s okay, what’s not.
  • Train them about the tools, processes, systems, everything. Don’t assume they’ll figure it out by watching others.
  • Check with them often for the first few days. Practice quick daily catch-ups for the first week. This is just to make sure they’re not lost or overwhelmed.
  • Have one-on-one talks and weekly chats. Ask what’s working, what’s not. People open up more when it’s casual.
  • Take the initiative for team bonding. It doesn’t have to be fancy. Simple coffee breaks, small outings, and inside jokes also count.
  • Then finally comes the 90-day review. Now that they’re acquainted with their role and the company, sit down, talk progress, and clarify future goals.

At the end of the day, learning how to hire employees for a small business doesn’t stop at hiring someone. It goes much beyond that. 

It goes to the point where you and your first hire are both comfortable with each other and have a good work momentum.    

Ready to hire? Here’s how Remunace can help you 

Ready to hire your first employee? Or still wondering where to even begin? Having confusion about your first hire is very common.

We get it. It’s a huge responsibility. Finding the right talent and retaining them at the same time is not an easy job. But who said you’ve to manage it all alone?

Find yourself the right partner who’ll guide and assist you throughout the process.

At Remunance, we experience the same roller coaster of recruiting and managing a team as you. Why? Because our team is present at all 360 degrees with you.

Here’s how we’ll walk with you in your journey:

• • Help you figure out how to hire your first employee without any assumptions.
  • Manage all the mandatory stuff like interview process, documentation, onboarding, payroll, etc.
  • Help you connect and bond with your team on a daily basis.
  • Back you up with local experts who know exactly how India works, business-wise and people-wise.
  • Bring experience from 16 countries and 100+ clients who’ve already been there, done that.

So, you focus on productivity, we’ll handle the hiring and admin part. Sounds fair?  

How to Manage Employee Benefits in India? 

To manage employee benefits in India, you have to follow a few important steps. First, take care of the statutory benefits for employees, and then think about what extra employee benefits and perks will attract and retain top talent.

Cover the Statutory Benefits First

• • Compliance with Indian employment laws is mandatory.
  • Get registered with EPFO and ESIC.
  • Pay contributions on time. That’s the foundation of statutory benefits.

Feedback from Employees

• • Don’t guess. Ask your employees.
  • Run a quick survey or even just talk to them.
  • Different age groups care about different things. A 25-year-old may want learning perks; a parent may care about childcare.

Add Perks on Top

• • Once you’ve got compliance sorted, add more.
  • Health cover, flexible work hours, wellness programs; these go a long way.
  • Good perks make people feel valued, not just employed.

Use Tools or Outsource

• • Benefits can get tough if you’re doing it manually.
  • HR software helps with enrollment and tracking.
  • Smaller companies often outsource to experts. It’s cheaper than building a whole team in-house. Some also partner with an employer of record to take care of employee benefits in India.

Preach them properly

• • If employees don’t understand their benefits, they won’t care about them.
  • Use onboarding, handbooks, quick workshops, and even short mailers.
  • Always show the bigger picture where employee benefits are more lucrative than the actual compensation.

Keep Updating on Your Perks

• • Employment laws change. Consequently, your employee benefits need to change, too.
  • Keep checking if your package still outperforms your competitors.
  • Compare with what others in your industry are offering. Stay competitive.

Hence, to manage benefits, you always have to keep yourself updated about different types of employee benefits in India and how they’re evolving.