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The Hiring Process

Emily Lewis
August 20, 2014

The Hiring Process

Lessons learned from a small business owner on hiring for the first time, as well as hiring and HR nuances for remote employees.

Presented at the 2014 Digital Business Summit.

Emily Lewis

August 20, 2014

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  1. Some rights reserved The Hiring Process: First Time Hiring &

    Remote Employees Emily Lewis for Digital Biz Summit AUG 20, 2014
  2. Owner, Lead Developer abrightumbrella.com Author, Microformats Made Simple microformatsmadesimple.com Co-author,

    HTML5 Cookbook shop.oreilly.com/product/0636920016038.do Managing Editor, Web Standards Sherpa webstandardssherpa.com Co-host, CTRL+CLICK CAST ctrlclickcast.com
  3. Seek Expert Help • HR consultant • Accountant • Lawyer

    • Notary public • Use your professional network
  4. Why Hire? • 1099 contractor isn’t possible • Business growth

    • Business investment • Professional collaboration
  5. State Employment Laws • For remote hires, employer must follow

    the laws of the state in which the employee lives • Contract or at-will employment • Minimum wage • Workers’ compensation
  6. Pre-Hiring Preparation • Create job title and description • Annual

    salary or hourly rate • Part-time or full-time • Create job application • Must specify type of employment • Be aware of what you can and cannot ask • Do not substitute with a resume
  7. Required Paperwork • After a job offer is accepted, new

    hires must complete • Job application • Employee eligibility verification (I9) • Employee withholding allowance (W4) • Conflict of interest statement • Emergency contact form • Summary of consumer rights • Release for background checks
  8. Required Paperwork • Comply with US and state labor and

    tax laws • Protects the employer’s business interests • Protects the employee’s rights
  9. Nice-to-Have Paperwork • Confidentiality agreement • Internet policy • Telephone

    and email policy • Travel policy, including per diems and reimbursements • Company-specific policies, such as work ownership and release of information to media
  10. I9 Verification • Federal form that verifies an employee’s eligibility

    to work in the US • Section one completed on or before the first day of work (the start date) • Section two must be completed within three days of the employee's start date
  11. I9 Verification • Verification requires in-person, physical examination of original

    documents • Verification by employer or an authorized representative • Presents a challenge for remote hires
  12. I9 Verification - Remote Hires • Notary public qualifies as

    an authorized representative • Verification is not a notarization; no notary seal • Notary title with signature should be “Authorized Representative” • Employer must maintain original document
  13. Document Storage Laws • Personnel file documents must be stored

    separately from all other new hire or employment documents • Personnel file documents are any containing protected personal information (PPI) • SSN • Date of birth • Credit card numbers • Home address • Home phone
  14. Document Storage Laws • Most documents can be stored electronically,

    provided the storage solution is • Reliable • Secure • Accurate • Accessible (can be reproduced in hard copy)
  15. Document Storage Laws • I9 is the exception; cannot be

    stored electronically • Recommended to store separately from everything else • Any hard-copy documents must be maintained in locked storage
  16. Document Retention • Different employment documents must be retained after

    termination for varying periods of time • When the retention period has passed, the documents must be destroyed
  17. Document Retention • Original job description and job application for

    one year from the date of termination • Payroll records for three years from the date of termination • Employment documents with protected information for three years from the date of termination • Tax records for four years from the date tax is due or paid • Just the tip of the iceberg
  18. Payroll • My accounting firm handles all payroll. I provided

    initial details: • Pay frequency (e.g. weekly, bi-monthly, monthly) • Hourly rate • Check or direct deposit • Estimate of quarterly gross payroll • Whether I would be paying payroll taxes online • The state my employee resides in
  19. Economic Nexus • Washington state has an economic nexus with

    businesses in certain classifications • Having an employee living and working in Washington qualifies as an economic nexus • This means additional business licensing and more taxes • Every state is different
  20. Economic Nexus • Registered my business as a Foreign LLC

    with Washington’s Department of Revenue • Certificate of Good Standing • Applied for a business license in Washington • Once processed, company operates like any other employer in Washington
  21. State Reporting • Within 20 days of a hire, must

    report new hires to Washington’s Social and Health Services Department • Accounts for online reporting and tax payments • Employment Security Department • Department of Labor & Industries • Washington Department of Revenue
  22. State Taxes • Employment taxes are only paid to the

    state where employee resides • Every state is different • State unemployment tax (SUTA) • Workers’ compensation insurance
  23. State Taxes • Depending on the state’s economic nexus rules,

    there may be non-employment taxes due • Business and occupation taxes on apportionable income • Use tax for goods and services used in Washington • Even if no tax is due, filing is required
  24. Federal Taxes • FICA (form 941) - employer's portion of

    social security and Medicare tax withholding • Employees also pay this tax • Due quarterly • FUTA (form 940) - federal unemployment tax based on payroll • No employee contribution • Quarterly or annually depending on tax liability
  25. Federal Taxes • EFTPS account for online payments • Filing

    not available online; hard-copy, snail mail • For both state and federal, my accounting firm prepares the reports and gives me a checklist for payments
  26. Hiring Is a Serious Business Decision • More taxes •

    More fees • More stress • More responsibility
  27. Totally Worth It • More focused, efficient workflows • More

    and better internal documentation • More strategic about clients, projects and opportunities • More strategic about engagement • New identity • Complete brand system • Intern • Bigger projects • All without a single interruption to our clients
  28. Hiring a Remote Employee • Part 1: Human Resources &

    New Hire Process • Part 2: Eligibility Verification & Document Retention • Part 3: Payroll & State Business Registration • Part 4: Employment-Related Taxes abrightumbrella.com/hiring