The Legal Side of Hiring

Good afternoon everyone! I hope this work week has been good to you and not too crazy since returning from a nice holiday break.

So it's 2022 and you're ready to start hiring new team members. There are several traits to consider when choosing the right candidate for a job position within your company. Hardworking, honest, punctual, trustworthy, creative, works well with others, you know the checklist. But what about the legal side of hiring? This article from uschamber.com breaks it down for us.

Apply for an EIN
First things first, before hiring employees you need a payroll system, and to have a payroll system you must have a federal EIN. This is a number, unique to your business, that's used for tax identification purposes. You can apply for an EIN on the IRS website and you'll just need to provide documentation such as a social security number and the basic information regarding the company, including corporation status.

Register with your state’s unemployment insurance office
I'm glad there's info like this so easily available, because all of the details can sometimes be a little confusing. According to the article, "The U.S. Department of Labor states that, generally, businesses must pay both federal and state unemployment taxes if they employ at least one person for 20 weeks in a calendar year, or if their employees’ wages account for over $1,500 per quarter. Your business will first register with the state office in charge of unemployment insurance, then record the quarterly wages of your employees and pay quarterly unemployment taxes online." QuickBooks can help with this too!

Verify your candidates' eligibility to work
When hiring new employees there are several forms for them to fill out. One of these is the U.S. Citizenship and Immigration Services’ I-9 form. This form is specifically used for verifying an individual's ability to work for your company. "Your prospective hire will fill in their identifying information, such as social security number and citizenship status, and they must provide copies of acceptable documents that prove their identity."

Report new employees to your state’s registry
As mentioned above, there are several forms for new hires to complete. Another one is to record their personal information such as full legal name and social security number. This info is then relayed to your state's registry and then on to the National Directory of New Hires "where the state will be able to find and withhold income from those who are behind on child support payments."

Check out the full article linked above for even more helpful tips to keep in mind when it comes time to hire new team members. What's something you wish you knew about hiring new employees? Your first hand experiences and stories are always appreciated!