Going from self-employed to business owner is quite the challenge, and hiring the right employee is paramount.

As an entrepreneur, I have two requirements for employees.

1. They make me look good.

2. They make me money.

These may sound arrogant or even somewhat abrupt.  But honestly, the only reason to have your own business is to make money.  It’s hard to make money if your company looks and runs unprofessionally.

This is why, after asking about their qualifications, I always ask potential employees on how they can make my company look good, and make a greater profit at the same time.

Hiring your first employee

When hiring employees we must take into account both monetary and human factors.

Legally each country, state, county or region has different rules about the processing of payroll, insurance & wage requirements, industry regulations and laws regarding employer/employee relationships.

Due to the highly litigious nature of the U.S., I recommend paying for an initial consultation in 3 areas, and then deciding which you need.

1. Payroll processor:

Payroll may sound easy but the laws and regulations that govern this are not. Hiring someone to process your payroll is cheap when compared to the hours of frustration you’ll spend doing it by yourself.

2. Accountant or Tax Professional:

Most self-employed people have made their own way using various business accounting programs like QuickBooks, or Peachtree, but things will change quickly when you take on new people.

So do yourself a favor come tax season, or before your first audit, and get professional advice. Then decide if you are able to go it on your own, or may need to hire an accountant.

3. Attorney serving your industry:

You may have been able to wing-it or skirt the law working alone, but with employees it’s not so easy.

Make a list of all the questions regarding potential liability and lawsuits that might come your way, and pose these to an informed lawyer or legal firm. If you work using contracts, work proposals or bids, make sure your paperwork ducks are all lined up.

Having an attorney help you in the beginning is a must. If you don’t, you might find yourself facing a group of lawyers working against you, due to poorly written contracts or employee error.

As new business owners, there are a lot of hurdles. And hiring our first employee shouldn’t be one of them. For more Payroll advice and hiring new employees visit our Small Business Sixth Step, and for more on human resources visit our new 4 Steps for Better Human Resource Planning.

Here is another great reference Hiring Your First Employee? Make a New Hire Checklist