Hiring your first employee can be a really scary step to take. Not only is it a lot of responsibility to earn enough to pay someone other than yourself, but there are a bunch of things we worry about getting wrong. How do we know the employment rules? What if it doesn’t work out? What if they steal my stuff? (And so on and so forth.) Basically, being the Bosslady can be a little daunting, but most of us reach the point where we simply can’t do it all ourselves and need to hire someone to help out. I recently met Belinda Avery, who has a day job as an HR professional but by night she’s a cake decorator who owns Cakes by Belinda. Who better to ask to help me educate you guys about hiring employees? She’s worked in corporate HR for 20 years and has managed teams across the Asia Pacific region – so she knows her stuff! Thanks so much Belinda for contributing to the blog. If you’ve got a specific HR question you want Belinda to answer, please get in touch via the blog and I’ll ask her to answer.
So let’s start at HR for Cakers 101. Most of you have probably been use to running a ‘one-man-band’ and have epitomised the term multitasking, doing everything from baking, cleaning, admin, marketing, whist juggling a family, friends and all whilst trying to have a life! As your business grows and you can no longer juggle all the tasks on your own you’ve finally decided to bring someone on board to join you. I could write a completely separate blog about recruiting & selecting (so watch this space). Apologies for generalizing here but I’m pretty sure a lot of you wouldn’t know about the things you need to have in place from a compliance perspective to reduce your risk when bringing a new person onto the books. Let’s be honest, employing someone can be pretty damn scary, not only do you have the pressure of having to pay their weekly salary but you have the added stress and risk of something going wrong and unfortunately things do go wrong (there’s another blog).
So I thought the best advice I could give you, and I’m not an employment lawyer, is to cover your backside when it comes to reducing your potential exposure. So I thought I would outline the 3 essential documents you should issue a new employer when they start working for you. They are:
1. A Contract of Employment
2. A Handbook of Policies
3. A Position Description
Why? Let me explain.
Contract of Employment
This is a legal binding document that outlines the employment relationship between you and your employee. Whether they are your sister-in-law, your next door neighbour or a new College graduate you must outline the conditions under which you are employing them. Some things which should be included in an employment contract are: position title, start date, hours worked, place of work, salary, superannuation/retirement funds, payment details (how you pay them and when), notice period, probation periods, leave or vacation entitlements (personal & annual), copyright rights and so on.
You might think that this is way too formal for you, when you’ve only got someone helping you out for a few hours a week but believe me, if anything goes belly up with your favourite new recruit (and things do) the very first thing an employment lawyer will ask you for is a copy of their employment contract. If you don’t have one, you are opening yourself up for legal exposure.
Handbook of Policies
A handbook of policies is simply a document that outlines the processes of your business and how YOU want things to be done. It is not a legally binding document, however a handbook of policies gives you the opportunity to set your own rules and standards on how your employees should conduct themselves from things like clothing (what to wear & what not to wear), leave (when you can take it & when you can’t), customer service (how to communicate with customers), applying for leave, professionalism, personal presentation and so on. (Michelle’s note: this is the place where “your business, your rules!” totally comes into it’s own.)
Ideally your new employee should read your Handbook prior to starting work with you. It can save you time (and money) in having to go through every minor detail of your business. When you need to ‘pull someone into line’ you can use your handbook to back up your reasoning. For example, if someone comes to work in a pair of flip flops you can refer them to your handbook which outlines not only what to wear but more importantly why. It’s not just because you are being picky or you don’t like beach wear, it’s because you have a formal policy that explains the conduct you expect and why (eg for safety reasons) . This is another document that those scary lawyers will ask for if you get in a pickle with an employee.
The Position Description
This is your fall back document. This is where you outline in detail the tasks you are expecting your employee to do on a daily basis. It also outlines the skills, experience, knowledge & qualifications you are looking for in someone to be able to do the job. I could talk forever about PDs (how sad) however, in this context the PD will be your back up when someone is not performing to the standards you expect. It helps you take the emotion out of a difficult conversation (there’s another blog) when you can explain that a particular task is not being done ‘as outlined in the Position Description’. This forms the basis of a performance management process if you are in a position where you might need to manage someone out of your business. (Michelle’s Note: I did performance reviews in order to get MORE out of my employees. It was a great way to work out that they had reached the point of needing to be promoted.)
You may think that this is overkill for a small business however, labour is most likely going to be your biggest single cost and so it’s important you are risk averse to protect you from things such as unfair dismissal claims and costly legal stoushes with disgruntled employees. (Michelle’s note: This article is not trying to scare you. Most of the time, employees are wonderful and there are no issues – but making sure these kinds of documents are part of your systems and procedures is like buying insurance for your business. You really don’t think you’ll ever use it, but you don’t want to be caught without it.)