session 2: finding and hiring the right talent. before we get started we’re going to move fast but...

Session 2:Finding and Hiring the Right Talent

Before We Get Started

We’re going to move fast but not too fast.

If I say something you don’t understand, please ask! QQQ is how you get our attention for questions.

Quick Review of Last Week

Creation• How to Effectively Build a Business Process using our 5 Step System that

eliminates the need for you to be involved in that Task or Set of Tasks (so you can go on vacation while your business still runs).• Including Sample Workflows that we use for our Employees so that you know how to

build processes.

• How to Map the Employee Workflow so that they fit into what you are already doing (and you don’t have to change your business based on them).• How to determine whether you hire an outsourced worker or an in house

employee.• How to know when you should offer equity (it’s rare… but there are cases

where this is the right choice).

Step 1 – Set the Goal


Set a goal for your process for CLARITY and FOCUS

Our Example GoalEarn income by creating an instantly accessible, video-based

information product that will be sold via a live webinar.

Step 2 – Give the Process a Name


Give a Name forEASY COMMUNICATION

Our Example NameWebinar Sale with Video Delivery

Step 3 – Define the Big Chunks


Define the Big Chunks to MAKE IT EASY TO UNDERSTAND THE BIG-PICTURE

Define the

Product

Create

Sales Materials

Create Product

Drive

Traffic

Sell the Product

Provide

Customer Support

Our Big Chunks Example

Step 4 – Add Details to the Big Chunks


Add Details to the Big Chunks to FURTHER DEFINE THE PROCESS INTO SUB-PROCESSES

Our Details with the Big Chunks ExampleDefine the Product

Create

Sales Materials

Create Product

Drive Traffic

Sell

the Product

Provide

Custome

r Suppor

t

Step 5 – Breakdown into Process Flows


Breakdown the Details into Process Flows to CREATE ACTIONABLE PROCEDURES FOR YOU AND YOUR TEAM TO FOLLOW

One of our Process Flow ExamplesDetermine

General Design using

Checklist

EndCreate Logo

Review - When to Add Staff to a FlowAdd Staff If:• You know clearly where they fit in your process

• This is great when you know your process and you want someone to replicate it.• This will example #1

• You know the result of something you need but not how to create it • This is great when you know what you want but not how to get it. Ex: logo, software, buy

button, etc• This will example #2

• You know how to do it, get the result but you suck at it or you hate doing it• This is a combo of the first two. For this, I suggest seeing of the other person’s process

works better than yours.• Ex: laundry, writing blog articles, SEO research, bookkeeping

• You have money to pay them

Review - How to Add Staff to a Flow

• Clearly define their start and end in the flow• Clearly define their deliverables

• checklists work great here

• Add a checkpoint for you approval when needed• This can be introduced several times in a work flow if need be.

• For example, you may want to see copy in a Word doc before someone gives you the HTML version since Word is easier to edit.

Review - Types of Staff

• High-Level Player• Creates Process

• Implementer• Does the Process

• Contractors – amount of workload determines type to hire• Freelance/One-Off

• Monthly or less work• Part-time

• Less than 35 hours a week• Full-time

• 35+ hours a week

• Employee• 35+ hours a week• They’ve proven themselves or have access to sensitive information (finance, hr, lead dev)

• Partner• Try to not do this.

What Are We Covering on Today’s Call?• Building Your Hiring Funnel

• The Places We Recommend Looking for Good People• Finding High Level Staff vs "Bit Players" is a completely different process and we'll show you how to do it

• How to Hire People that Do Things that You Don’t Understand Completely.• Designers, Coders, Developers, Finance, etc

• How to make first contact and eliminate the wrong candidates right away.• How to Interview Confidently.

• Including our Simple Interview Guide with the questions you MUST ask every candidate

• The Legalities of Hiring • 2 Steps to Hiring a Contractor• 4 Steps to Hiring an Employee• What Legal Documents you Must Have and How Long to Keep Them

• The Simple Clauses that you need to Add that NO ONE THINKS OF (aka our "Asshole Clause")• Payroll Details including Taxes and the IRS

What Are We Covering on Next Week’s Call?

Building a Happy Team!• The Secret to Onboarding Your Staff using Training Plans• The 7 Rules To Keep Your People Happy• How to Keep Your Team Productive Day in and Day out• 4 Examples (that you can steal) of how we Keep Our Staff Close (even those

that work remotely)• How to Develop Rockstars (Life Path Building and Stumbling Block Removal)• Benefits and Insurance - what is required vs what is nice (you'll be surprised at

what the law says here)• When and How to Fire Someone (including the exact words you should use)

Section 1Building Your Hiring Funnel

Building Your Hiring Funnel

Phase 1Prepare

Phase 2Find Candidates

Phase 3Invitation & Test 1

Phase 4Interview

Phase 5Hire

Hiring Funnel – Phase 1 - Prepare

Phase 1 – Prepare• Do Your Process Flows from Session 1• Create a Job Description• Determine Your Budget

Phase 1Prepare



Phase 4Interview

Phase 5Hire

Create a Job Description

Job Creation ChecklistDefine Expectations and/or Success

MetricsDeliverable(s)Checkpoints/Approvals

Implementer Only: Detail EXACTLY what you want the person to do

High-Level Player Only: Give some information about the work

Building Your Hiring Funnel – Phase 1 – Prepare

Determine Your Budget

1. Review Your Finances to See What You Can Afford

2. Review What the Going Rate is using the Web• Salary.com• Review similar jobs on

Upwork/Elance3. Do What You Can to Start

and Grow Into More Expensive Talent

Building Your Hiring Funnel – Phase 1 – Prepare

Hiring Funnel – Phase 2 – Find Candidates

Phase 2 – Find Candidates1. Make Your Company a Magnet2. Friends/Family3. Referrals4. Networking5. Freelance Sites6. Go Find Them7. Job Sites

Phase 1Prepare



Phase 4Interview

Phase 5Hire

Make Your Company a Magnet

1. Create awesome products2. Be respectable3. Have fun

Do these things and you’ll have people asking to work for you

Building Your Hiring Funnel – Phase 2 – Find Candidates

Friends/Family

• Sounds great at first but usually ends in disaster• If you must, make it a contracted short-term thing where the roles, pay, and

payment schedule are incredibly clear

Just Don‘t


Referrals

1. Tell People You’re Looking2. Post on Social Media3. Make Sure You Trust the Referrer

Hiring Someone that is AlreadyRecommended is Fantastic


Networking

1. Leave Your House2. Attend Conferences3. Attend MeetUps (meetup.com)4. Join a Co-Working Space

Meeting People In Person Helps You Determine Fit

Quickly


Upwork/Elance/Freelancer/etc…

1. Lots of choices2. Fantastic if done correctly

My Favorite is UpWork


Go Find Them

1. Go to ThemeForest.com (or similar site)2. Find something you like – a theme or piece of code3. Contact them through the site and ask them if they do

freelance work4. If so, put them through the rest of the hiring funnel

This Works Because They’ve Already Delivered Work You Like and They are

(usually) Not in Corporate America


Job Sites

1. LinkedIn2. Monster3. Dice4. Craigslist5. etc.

Some of These are Paid ServicesBut They are Great for Employees


Monica’s Favorites

1. For a Complete Web Design• I find them on ThemeForest.com because I like that I can see what

they have already made2. For Logo Design• 99Designs.com because I love the competition

(I also love their already designed section)3. For Everything Else• UpWork because I think they have the best candidates and the best

system.


Hiring Funnel – Phase 3 – Invitation & Test

Phase 3 – Invitation & Test1. Turn Your Job Description into an

Invitation 2. Include Test 1 to weed out 60-70% of

candidates

Phase 1Prepare



Phase 4Interview

Phase 5Hire

Turn Your Job Description into an Invitation

Job Invitation Checklist

Define Expectations and/or Success Metrics Deliverable(s) Checkpoints/Approvals

Implementer Only: Detail EXACTLY What You Want the Person to Do

High-Level Player Only: Give some information about the work

Add Information about You and the CompanyBe AppealingInclude the First Test

Building Your Hiring Funnel – Phase 3 – Invitation & Test 1

Part-Time Household/Personal Assistant Needed

Hello,

I’m looking for a household/personal assistant to help me get things done. Here’s the preliminary list of things I can think of that I need help getting done on a regular basis:

• Running errands – returns, grocery shopping and other shopping.• Vacation services – picking up the mail, putting out the trash, etc.• Shipping/Post office – packing and taking things.• Planning/Research – help with planning events/date nights. • General Tasks – car maintenance, home organization/sorting, etc.• Light Cooking Prep – mostly chopping vegetables (onions make me cry)

About me: I work from home and am the owner of an internet-based business that sells software and information products. We employ about 15 people all over the world. I have a lot to get done and not enough time to get it done. I am a non-smoker, have no pets, and travel frequently.

About you: You should have a “let’s make it happen” attitude and a willingness to find solutions.

I’d like to start with one day a week and increase from there. The end of the week (Wed/Thurs/Fri) would be best for me.

If it sounds like a fit, I’d love to chat with you! Please reply with the best time and phone number to reach you.

Best, Monica

Test 1

Ask the Candidate to do something very simple and specific

Examples:• In this example, I asked them to reply with the

best time and phone number to reach them.• Please reply with 3 reasons you think you’ll

excel in this job.• Please correct the grammar and/or spelling in

this sentence: ‘Employee’s must wash there hands before returning to work!’ or ‘It isn't fare that people judge other people buy there grammer.’


Part-Time Household/Personal Assistant Needed

Hello,

I’m looking for a household/personal assistant to help me get things done. Here’s the preliminary list of things I can think of that I need help getting done on a regular basis:

• Running errands – returns, grocery shopping and other shopping.• Vacation services – picking up the mail, putting out the trash, etc.• Shipping/Post office – packing and taking things.• Planning/Research – help with planning events/date nights. • General Tasks – car maintenance, home organization/sorting, etc.• Light Cooking Prep – mostly chopping vegetables (onions make me cry)

About me: I work from home and am the owner of an internet-based business that sells software and information products. We employ about 15 people all over the world. I have a lot to get done and not enough time to get it done. I am a non-smoker, have no pets, and travel frequently.

About you: You should have a “let’s make it happen” attitude and a willingness to find solutions.

I’d like to start with one day a week and increase from there. The end of the week (Wed/Thurs/Fri) would be best for me.

If it sounds like a fit, I’d love to chat with you! Please reply with the best time and phone number to reach you.

Best, Monica

Why Test 1?

• Weed out 60-70% of Candidates• They don’t pay attention to detail• They can’t follow instructions


Invitation & Test 1 – Implementer ExampleI'm building an iPhone game and need the following graphics designed. You will be responsible for knowing proper dimensions and specifications for the iPhone.

These graphics will be very cartoony in nature. They are for a toddler game.

1) 2 sets of train tracks - on that will fit horizontally across the phone and one that will fit vertically.2) 2 trains that have a large transparent component so that the color can dynamically change. The trains will have different perspectives.3) iPhone icon featuring the train in blue on a green background4) background for iPhone game that is textured like grass but clear so that the color behind it shows through.5) Success screen featuring the a big train and an open talking bubble (text will dynamically go in the bubble)6) Crash screen featuring a big crash. Something like this (http://www.istockphoto.com/stock-illustration-13580804-bursting-and-explosion-of-star.php?st=f28bbf0) but within my color palate and without the middle banner. Even though I don't want a banner, I do want the word "Crash!" on the image.

All colors should be the purple, blue, green, yellow, orange, & red from http://www.colorschemer.com/schemes/viewscheme.php?id=6316

Once I've awarded the job, I will send the spec so you can get a full grasp of the game. I am building it with a friend and we are looking to launch the game in about a month.

In your reply please let me know an estimate of how many hours you think this will take. All submissions without an estimate will be rejected.

Thanks!


Test 1

EXAC

TLY

Wha

t I W

ant

I used this to hire the graphic designer for Toddler Train Crash from UpWork. I’ve used him several times since.

About

https://www.upwork.com/leaving-odesk?ref=http://www.colorschemer.com/schemes/viewscheme.php?id=6316

Invitation & Test 1 – High-Level Player ExampleHello,

We are kicking off a new software project and need it to blow our user's minds (in a good way)! That's where you come in. I have a vision for what I want but want you to make it amazing.

The software is XXX software. Users will XYZ. There will also be customer facing sales pages, about us, pricing, etc.

I love to see clickable, online prototypes that I can show my business partner that can evolve into the software.

You'll be working directly with me and my business partner will be giving a lot of input. He's the marketing guy. I'm the tech. We've been working together for years and have a great relationship. I've been coding/testing/building web software since 1997 so you'll be working with someone that knows and understands that process. Also, I will be doing a lot of the back-end coding.

Our company is doing very well and the goal with this software is to focus our energy on this product. We are working on timelines now so this isn’t a “this has to be done tomorrow” project. We want to build something high quality and amazing. That means we are looking for someone that works really well with us. That means I will be interviewing people. I will be looking at portfolios. I’m really looking for someone that is a rockstar and we can work with for a long time.

You should apply if:• You understand User Flow – how to get the users to do what we want them to do• You’re amazing at UI Design – making it pretty and functional• You create interactive prototypes – this is the best feedback tool• Your HTML/CSS/JS skills are rock solid - to create the site and make it fully responsive and cross-browser compatible• You’ll give creative direction and ideas – we’re not looking for a robot• You can work with a team – we love to get stuff done with a smile

You should not apply if:• You’re a diva• You’re flaky• This is your first or second time doing this kind of work• You don’t have a portfolio that can be reviewed• You aren’t looking for longer term work• You don’t have time for this project

Still here? Great! If you reply, please let me know your availability for a Skype interview as well as a link to your website and/or portfolio.

Thanks!Monica

Building Your Hiring Funnel – Phase 3 – Invitation & Test 1Ex

pect

ation

s

Test 1

Abou

t Us

About the Work

I used this to hire our front-end developer from UpWork. He’s now working on Payl.io

Hiring Funnel – Phase 4 – Interview

Phase 4 – Interview1. Choose 2-3 Candidates2. Hire Implementers

• Their job is the test3. Interview High-Level Players

• Including their test and questions4. Interview Tips & Red Flags

Phase 1Prepare



Phase 4Interview

Phase 5Hire

The First Interview

Choose the Top 2-3 Candidates to Interview• Base this on these criteria:• How you found them

(place slightly higher emphasis on referrals and people you’ve met)• Their resume/profile/portfolio• Their response to your invitation• Your gut instincts

Building Your Hiring Funnel – Phase 4 – Interview(s)

The First Interview

HIRE 2-3 Candidates for a specific deliverable and cost• Examples:

• 3 articles for $15• 1 infographic for $75-100 (depending on how detailed)• 1 proofread for $20• 2 hours of web research for $20

Their results on the small task will tell you if you want to move forward and continue working with the Implementer.

For Implementers


Hiring Implementers for the First Interview Will Save You Time, Energy, and Money

The First Interview

Set up a 20-30 minute phone interview• Ask them these 4 questions:

• Tell me about yourself• You’re looking for a professional answer that makes you feel good about their history.

• Tell about a time where you’ve done work like I need before• You’re looking to see if they have a process for this work. If they aren’t specific, ask for specifics.

• What am I not asking you that I should be?• Since you don’t know what you don’t know, ask them! They should have an answer that makes you feel good – not

stupid.• What questions do you have for me?

• If they don’t ask you any, pass on them because they aren’t interested in YOUR project, they are just looking for work.

Move forward if they made you feel comfortable and like you want to work with them.

For High-Level Players


The Second Interview - a Test

Set Up a Test• This test should be specific to what you want hire them to do

• Examples:• For our finance position, we gave the person a download of Nanacast sales from a previous month and

asked them to organize it as best they could. This showed us how they think about organization. • For a developer, ask them to define a checkout process for you in a flowchart.• For a designer, ask them to review a website or design of your choice and give 3 specific ways they

would improve it

You’re looking to see if the person can think the way you want them to think.

Move forward if they pass the test (yes, this is subjective).



The Third Interview

Set up a second 20-30 minute phone interview • Ask them at least these 4 questions:

• What motivates you?• You’re learning to see if they fit your culture/style

• What is there about this opportunity that most excites you? • They should be excited about the job for specific reasons related to the opportunity (and not money)

• What are some concerns you have about this opportunity?• A good high-level player will always have a few concerns. They shouldn’t be deal breakers.

• How do you define done?• I love this question because I want to know if they are a perfectionist.

• How do you approach the work that needs to be done for my company?• Again, looking for their process



Interview Red Flags

STOP the Interview Process If Any of These Occur:• The candidate is late• The candidate is rude or disrespectful • The candidate is unprepared• The candidate’s responses are always vague• The candidate makes you feel dumb

• Even when you’re hiring for things you don’t fully understand, a candidate should never make you feel stupid

• You get a bad feeling• You just don’t like them


Interview Legal Matters

Don’t ask questions that require an applicant to reveal any information protected by law. This includes:• Age• Race• Color• National origin• Religion• Marital status• Sexual orientation


Interview Tips

• Make sure you ask questions that require more than just a “yes” or “no” answer• LISTEN• Don’t be thinking of your next question. Listen to what they say and ask follow

up questions.

• If possible, have a man and a woman interview the candidate• People react differently to different people

• At the end of every interview, let the candidate know when they can expect to hear from you again• It’s easier to reject and be rejected by email


Hiring Funnel – Phase 5 – Hire

Phase 5 – Hire1. Extend the Offer

Phase 1Prepare



Phase 4Interview

Phase 5Hire

Formally Extend the Offer

• If hiring through a website, click the hire button • If not hiring through a website, put together an offer packet that

includes:• Offer Letter• Contract• Tax Documents• Employee Handbook• Etc(we’ll cover all those next)

Building Your Hiring Funnel – Phase 5 – Hire

Congrats!

• You’ve got staff!

Building Your Hiring Funnel – Phase 5 – Hire

Quick Review of Building Your Hiring Funnel


Phase 1Prepare



Phase 4Interview

Phase 5Hire


Phase 2 – Find Candidates1. Make Your Company a Magnet2. Friends/Family3. Referrals4. Networking5. Freelance Sites6. Go Find Them7. Job Sites

Phase 1Prepare



Phase 4Interview

Phase 5Hire




candidates

Phase 1Prepare



Phase 4Interview

Phase 5Hire





Phase 1Prepare



Phase 4Interview

Phase 5Hire


Phase 5 – Hire Them1. Extend the Offer

Phase 1Prepare



Phase 4Interview

Phase 5Hire

Section 2The Legalities Hiring

Disclaimer

We are not Lawyers or Accountants.These are Guidelines.

Check with Your Lawyer & Accountant to Ensure You’re Obeying all the laws.

Who’s Tabitha Thomas

• I’m the Director of Human Resources at Fearless Social

• I was previously the CFO of Film Production Company

Fun Facts about me: • I have two rowdy boys- one who is a stubborn red head• I LOVE to cook and bake• I am obsessed with home renovations

What’s In This Section

• Employee vs. Contractor (Legal)• The 2 Legal Steps for Hiring a Contractor • The 4 Legal Steps to Hire an Employee

We are covering US-based businesses. The process in other countries is similar but check with your local business association, legal people, and accountants.

CONTRACT

• Set their own hours, work with other clients, use their own tools/ equipment• Are an independent business in their own right• Charges either hourly rate or a monthly fee, which they invoice to the company• Are responsible for their own taxes, business insurance, health insurance, and social security taxes• Not entitled to overtime, but can charge extra if work takes longer than expected

EMPLOYEE

• Work hours you set, rarely work with other companies, use your tools and equipment in their work• Are employed by your company, which means you have legal and financial obligations to them • Are paid a salary or per hour, either weekly, monthly or bi-monthly • The company pays all employee taxes, federal and local tax deductions and social security• Can receive overtime, bonuses, or other benefits in kind, which are all taxable deductions for your company

EMPLOYEE VS. CONTRACTOR: Legalities

EMPLOYEE VS. CONTRACTOR

Still Not Sure?• If you are still unsure if they should be an employee

or a contractor you can fill out IRS form SS-8 and send it in and the IRS will let you know how to classify that person. • http://www.irs.gov/pub/irs-pdf/fss8.pdf

http://www.irs.gov/pub/irs-pdf/fss8.pdf

http://www.irs.gov/pub/irs-pdf/fss8.pdf

The 2 Legal Steps for Hiring a Contractor

Include: A description of the services the contractor will perform A description of how much you will pay them, how and

when (usually either a fixed fee for a finished product or a sum based on the unit of time)

An explanation of who will be responsible for expenses (true contractors pay their own expenses)

An explanation of who will provide materials, equipment

(true contractors provide all of these) A statement that you and the worker agree to an

independent contractor relationship A statement that the contractor has all of the permits

and licenses that the state requires to do the work A statement that the contractor will pay state and

federal income taxes An acknowledgement by the contractor that they are not

entitled to any of the benefits you provide employees

A statement that the contractor carry liability insurance A description of the term of the agreement (one week,

one month, a season, until the project is complete) A description of the circumstances under which you or

the contractor may terminate the agreement (typically must be done in writing)

An explanation on how you and the contractor will resolve any disputes

Copyright ownership

The Simple Clause that you need to Add that NO ONE THINKS OF

The “Asshole Clause” – this gets you out of a time-based contract if the person is an asshole. Make sure it is in there!

The 2 Step Legalities of Hiring a Contractor – Step 1 – Contracts

Contract

Confidentiality Agreement

• A confidentiality agreement, sometimes called a nondisclosure agreement (NDA) is a legally binding contract in which the contractor promises to treat specific information as a trade secret and promises not to disclose the secret to others without proper authorization. • This protects your company’s ideas and

secrets

The 2 Step Legalities of Hiring a Contractor – Step 1 – Contracts


Step 1: Contracts

Step 2: Tax Documents

Get Your EIN

Register for your Employer Identification Number (EIN)

• You will need to get this number from the Internal Revenue Service• You can do it online at

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Apply-for-an-Employer-Identification-Number-(EIN)-Online

• The EIN is necessary for reporting documents to the IRS • The EIN is also used to open banking accounts

YES YOU NEED IT, EVEN WHEN HIRING A CONTRACTOR

The 2 Legal Steps for Hiring a Contractor – Step 2 – Tax Documents





IRS Form W9

• This form is used in a wide range of payment situations, but most commonly, taxpayers fill them out when they are working as a freelancer or independent contractor rather than an employee. • Request this from from all contractors prior to

them starting the work.• If a business has a W9 Independent contractor you

must provide the contractor with a 1099 by the end of January if they were paid $600 or more. • http://www.irs.gov/pub/irs-pdf/fw9.pdf


Note: if you’re paying your contractor through a system like UpWork you do not need to get a W9 or send a 1099

http://www.irs.gov/pub/irs-pdf/fw9.pdf


IRS Form 1099K – Paypal Exception

• If you are paying an independent contractor via Pay Pal they may receive a 1099K from Pay Pal.• The new form will report all the

money received through Pay Pal for the year. • This form will only be sent to the

independent contractor who processed over $20,000 in goods/services AND completed 200 transactions.


Affiliates

• Affiliates are Contractors for Your Business!• The “contract” is established in JVZoo/Nanacast/Other affiliate system• You need a W9 for anyone that you paid over $600

(unless you only paid them via Paypal)• You must report the income to the IRS for anyone that you paid over $600


Keep These Records

Businesses should keep records of ContractsConfidentiality AgreementW9 and 1099sInvoices

These are Nice to Have TooCopy of any Insurances (individuals usually don’t have these)

Workers’ CompBusiness Insurance

Copy of Contractors Business License individuals usually don’t have these

A business card of the contractor


Review – The 2 Legal Steps for Hiring a Contractor

Step 1: Contracts


Step 1: Get Set Up Correctly

Step 2: Create the Offer Packet

Step 3: The Dreaded Taxes

Step 4: Recordkeeping

The 4 Legal Steps to Hire an Employee


• Get Your EIN• Register for a State ID Number• Register New Hire Reporting• Obtain Workers Compensation

Insurance• Post Federal and State Notice

Posters

Step 2: Create the Offer Packet Step 3: The Dreaded Taxes Step 4: Recordkeeping



Get Your EIN

This is the same as for a Contractor• The EIN is also necessary when reporting information about your

employees to state agencies.

The 4 Legal Steps for Hiring an Employee – Step 1 – Get Set Up Correctly

Register for a State ID Number

• State Income Taxes• Depending on the state where your employees are located, you may be

required to withhold state income taxes which requires a State ID Number• If you have employees in more than one state you will need to register with

each state that you have employees in. • Some states (TN for example) doesn’t withhold state taxes.

• Each state has its own laws that change frequently. You must check with your accountant to be sure you are obeying all the tax laws for the state(s) you’re required to pay taxes.


Register New Hire Reporting

• All employers are required to report newly hired and re-hired employees to a state’s directory within 20 days of their hire or re-hire date• If you have employees in two or more states and wish to

register to submit their new hire reports to one state you can do this • Multistate Employer Notification Form for New Hire Reporting

PDF

• The Small Business Administration has a great website that has every states new hire reporting requirements listed out • https://www.sba.gov/content/new-hire-reporting-your-state


https://www.sba.gov/content/new-hire-reporting-your-state

https://www.sba.gov/content/new-hire-reporting-your-state

Obtain Workers Compensation Insurance• Workers Compensation Insurance will protect

you legally if an employee were to get hurt on the job.

• All businesses with employees are required to carry Workers Compensation Insurance coverage through a commercial carrier, on a self-insured basis or through their state’s workers’ compensation insurance program.


Post Federal and State Notice Posters• Employers are required to display in the

workplace, or an area that all employees have access to, that inform the employees of their rights and employer responsibilities under labor laws. • The US Department of Labor has a great site that

has all of the federal required posters • http://www.dol.gov/whd/resources/posters.htm

• Each state will have specifics on what they require • This site will tell you what you need. Go to your specific

state’s page to find the free posters. • http://www.gneil.com/labor-law-and-safety/labor-law-

compliance


http://www.dol.gov/whd/resources/posters.htm

http://www.dol.gov/whd/resources/posters.htm

http://www.gneil.com/labor-law-and-safety/labor-law-compliance






Posters

Step 2: Create the Offer Packet Step 3: The Dreaded Taxes Step 4: Recordkeeping

Review Step 1 – Get Set Up Correctly






Posters


• Offer Letter• Employment Contract• Confidentiality Agreement• Employee Handbook• IRS Form W4• I-9 Employment Eligibility

Verification • State W4

Step 3: The Dreaded Taxes Step 4: Recordkeeping



Offer Letter

• A formal offer letter is extended AFTER a verbal offer for employment • Acceptance of your offer is tentative until you receive the SIGNED offer letter• Letter Should Include:

• position• title• who that person will report to• what duties and responsibilities that job will entail• how much the position will pay• what benefits are being offered • holidays and if they are paid or not • vacation time if it is offered • start date • a statement that the employment is at will and that either party may terminate the employment

relationship with or without cause

The 4 Legal Steps for Hiring an Employee – Step 2 – Create the Offer Packet

Employment Contract

Include these Sections

• The Relationship • (typically wording sounds like: “On behalf of Thirty3

Productions, LLC, a Missouri limited liability company (the “Company”) I am pleased to offer you the position of ________. Your employment by the Company shall be governed by the following terms and conditions.”

• What do you provide for the employees, and what do you get in return? • Job responsibilities • Wages and taxes• Benefits

• How the job will be performed and if it is an exclusive relationship • Full time or part time employment • Can they provide services to any other employers or

engage in other forms of employment (i.e. self employment)


• How can the relationship can end• At Will Employment • Rights Upon Termination• Non Disclosure

• Other useful clauses to have in the contract• Right to Work- stating they must provide proof

of their identity and eligibility for employment • Disputes- discuss how disputes will be

handled (Arbitration)• Notices- shall be communicated in writing • Choices of Law and Severability- what state

are your contract be interpreted by• Ask your lawyer!

At-Will Employment Exceptions

All states recognize at-will employment- BUT some states place limitations on it. These limitations are in addition to the ones the federal law apply to all states.

• Public Policy Exception• An employee would be considered “wrongfully discharged if their firing went against a well

established public policy of the state in which they work. (are you asking them to break the law or did you fire them for filing a workers compensation claim)

• The Implied Contract Exception • When you have employees sign at-will employment contracts but include in the contract or employee

handbook the statement that they will only be terminated for “just cause” or procedures for termination of employment then you may not be an at will employer.

• The Covenant of Good Faith Exception (AL, AK, AZ, CA, DE, ID, MA, MT, NE, UT, WY)• It requires that employers only terminate employees for just cause, even if the Employee Handbook

or Employment contract says nothing about the requirement.


Confidentiality Agreement

This is the same as a contractor


• A confidentiality agreement, sometimes called a nondisclosure agreement (NDA) is a legally binding contract in which the contractor promises to treat specific information as a trade secret and promises not to disclose the secret to others without proper authorization.

• This protects your company’s ideas and secrets

Employee Handbook

• Although it is not required, it is an excellent idea to have a handbook describing your business’ employee policies.• It should also make clear that employment is

at will (unless you have an employment contract that states otherwise)

• The Employee Handbook should be signed at the same time as the offer letter


Employee Handbook

Policies that are good to have in your Employee Handbook

Team Member Benefits Insurance 401K/IRA

Compensations, Time Off & Other Programs Pay Day Direct Deposit Payroll Deductions Pay Increases Commission Time Off Holidays Leaves of Absence Maternity Leave

Employment At Will Employer Americans With Disabilities Act Equal Employment Opportunity I9 Attendance Policy Teamwork and Mutual Respect Workplace Harassment and Discrimination If you Encounter Harassment Social Media Policy Internet, E-Mail and Computer Use Policy Ownership and Access of E-mails and Computer Files Access to Personnel Files Personal Data Changes Resignation / Termination


IRS Form W4

IRS Form W4 - Withholding Allowance Certificate• On the W-4 form, employees tell you how many

allowances they are claiming for tax purposes, so that you can withhold the correct amount of taxes from their paychecks. • This form does NOT have to be filed with the IRS,

but it must be kept on file. • This form should be filled out each year if they

want to change their allowances. • http://www.irs.gov/pub/irs-pdf/fw4.pdf





I-9 Employment Eligibility Verification • U.S. Citizenship and Immigration Services requires

employers to use this form to verify that every employee they hire is eligible to work in the United States. • This form does NOT have to be filed with the USCIS

but employers MUST keep it on file for 3 years and make it available for inspection by officials of Immigration and Customs Enforcement. • The files should be kept in a separate I-9 folder for

all employees - not in each employee’s personal file. • To verify employee information on the I-9 form you

will want to use E-Verify. http://www.uscis.gov/e-verify


http://www.uscis.gov/e-verify



State W4

• Each state may have their own withholding form for state withholding taxes. • Employers will need to have these on file and

then also send that form into their state. • The Department of Labor has a website with

each of these. • http://www.bls.gov/jobs/statetax.htm


http://www.bls.gov/jobs/statetax.htm

http://www.bls.gov/jobs/statetax.htm




Posters




Step 3: The Dreaded Taxes Step 4: Recordkeeping

Review Step 2 – Create the Offer Packet






Posters





• Payroll Taxes• Paying Federal Income Taxes• Tax Nexus• State Taxes• Hire Payroll & Accounting

Services




Hang With Us

We are going to cover it all but…

WE STRONGLY ADVISE YOU

HIRE AN ACCOUNTANT and get a PAYROLL SYSTEM

The 4 Legal Steps for Hiring an Employee – Step 3 – The Dreaded Taxes

Payroll Taxes

• Payroll taxes are taxes imposed on employers or employees.• They are usually calculated as a percentage of the salaries that employers pay their staff.

• Payroll taxes generally fall into two categories: • deductions from an employee's wages• taxes paid by the employer based on the employee's wages

• Employers are responsible for withholding and depositing payroll taxes from their employees wages.

• Employers must furnish each employee with a Form W-2 each year and file Forms 941, 940 and W-3 as well as form 945,and 1099 where applicable. • There are other forms as well for specific business types (restaurants, non-profits, etc)• Yeah, we know that’s a lot of numbers… this is why you pay accountants!


Tax Forms

• W2/W3- The IRS require employers to report wage and salary information to employees on form W-2. It also reports the amount of federal, state and other taxes withheld from the employees paycheck. The W2 is sent to the employee. The W3 is sent to the IRS.

• 1099- an IRS tax return document used to report miscellaneous payments made to non-employee individuals during the calendar year.

• 941- a quarterly report of wages paid to employees and withholdings made by employers. It also includes information on the employers share of Medicare and Social Security taxes during the period reported.

• 940- Employer’s Annual Federal Unemployment (FUTA) Tax Return. Together with state unemployment tax systems, the FUTA tax provides funds for paying unemployment to workers who have lost their jobs.

• 945- Annual Return of Withheld Federal Income Tax – Use this form to report withheld federal income tax from non payroll payments.


Paying Federal Income Taxes

• You must deposit Federal Income Tax withheld and both the employer and employee social security and Medicare taxes. • 941 Federal Tax Deposits for your Payroll Taxes must be submitted via

Electronic Funds Transfer (EFTPS)• There are two deposit schedules: monthly and semi-weekly.

• The deposit schedule will be based on the total liability you report on form 941.


Federal Tax Payment Schedule

Quarterly/ Annual Filing Period

Filing Date Payroll Tax For Sent To

1st Quarter April 30 941 Federal and Quarterly State Forms

Internal Revenue Service

2nd Quarter July 30 941 Federal and Quarterly State Forms


3rd Quarter October 31 941 Federal and Quarterly State Forms


4th Quarter January 31 941 Federal and Quarterly State Forms






Annual January 31 944 Federal Internal Revenue Service

Annual January 31 940 and annual state forms

Internal Revenue Service and your state(s)

Annual January 31 W2 Your Employee

Annual January 31 W3 Internal Revenue Service & Social Security Administration





Annual January 31 945 Internal Revenue Service

Annual January 31 1099 Internal Revenue Service and the Independent Contractor


Tax Nexus

• “Tax Nexus” is a legal term that refers to the requirement for companies doing business in a state to pay taxes in that state. • Normal Nexus is any one of the following: office location in state, employee

in state, inventory or fixed asset within state. • Some states consider independent contractors (form 1099) as an employee

that qualifies you to be in state. So just having a 1099 contractor does not get you around the employee issue. • If you have any one of the above, you are going to be required to file

income taxes in that state.

Note: this applies to sales tax too but that’s a whole other party – talk to your accountant


State Taxes

• State Taxes are any taxes that are deposited with any one of several state agencies. • Possible State Taxes

• State Income Taxes• State Unemployment Training Tax• State Disability Insurance • Local Tax • City/County Tax

• Not all of these taxes apply to every state


State Taxes

• Each state has its own rules for• what taxes are withheld• when the deposit is due• what form the tax information is filed

• Employers may have employees in more than one state, so there can be quite a few entries that fall under state taxes. • Small Business Association has a great resource

that shows where to find your states info: • https://www.sba.gov/content/learn-about-your-state-and-local-tax-obligations


https://www.sba.gov/content/learn-about-your-state-and-local-tax-obligations



Hire Payroll & Accounting Services

• Make your life MUCH easier and Hire an Accountant and get a Payroll Service• They handle all the different stuff we just covered

• They are the Experts• Taxes and payroll laws change ALL THE TIME. They keep you up-to-date and legal.

• They will save You Time• Your time is better spent on marketing and process creation.

• There are several great Payroll Services:• Quickbooks • Benefit Mall (this is what we use)• Zen Payroll

• We recommend you use the one your accountant recommends





Posters






Services


Review Step 3 – The Dreaded Taxes






Posters






Services


• Keep these Records• Make it Easy with Software



Keep these Records

• Records that must be retained for a minimum of 4 years include:

Form I-9Dates and amounts of taxes paidCopies of returns filed Records of allocated tips (restaurants)Records of fringe benefits providedPeriod during which employees were

paid while absent (including third party sick pay)

Employer Identification Number (EIN)

Amounts and dates of all wages paid Amounts of type reportedFair market value and in-kind wages

paid Names, address and SSN of

employees and/or recipientsEmployee copies of undeliverable W-

2s. Dates of employmentForm W-4

The 4 Legal Steps for Hiring an Employee – Step 4 – Recordkeeping

Note: Some states have longer periods of retaining records (i.e. In Texas benefit related material must be kept for 6 years.) Ask your accountant they will know on your specific state’s requirements

Make it Easy with Software

• Bamboo HR and People HR are two websites that we recommend to help keep everything together.• The software does more than just keep records in one place. It also:

Onboarding / OffboardingTracks vacation/sick time off Reminds us of employee’s birthday/anniversary Company announcementsKeeps our federal and state notice postersCreates job openings for people to apply to Keeps our employee job reviews Tracks trainings Allows us to track notes on employee accomplishments or times of errorKeeps us compliant





Posters






Services



Review Step 4 - Recordkeeping






Posters






Services



Full Review – The 4 Legal Steps to Hire an Employee

Sample Documents You Will Receive: Sample Contractor Contract Sample Offer Letter Sample Employee Contract Sample Confidentiality Agreement Sample Employee Handbook

Quick Summary



Phase 1Prepare



Phase 4Interview

Phase 5Hire


Phase 2 – Find Candidates1. Make Your Company a Magnet2. Friends/Family3. Referrals4. Networking5. Freelance Sites6. Go Find Them

Phase 1Prepare



Phase 4Interview

Phase 5Hire




candidates

Phase 1Prepare



Phase 4Interview

Phase 5Hire





Phase 1Prepare



Phase 4Interview

Phase 5Hire


Phase 5 – Hire Them1. Extend the Offer

Phase 1Prepare



Phase 4Interview

Phase 5Hire

• Set their own hours, work with other clients, use their own tools/ equipment• Are an independent business in their own right• Charges either hourly rate or a monthly fee, which they invoice to the company• Are responsible for their own taxes, insurance social security and medical payments• Not entitled to overtime, but can charge extra if work takes longer than expected

CONTRACT

• Work hours you set, rarely work with other companies too, use your tools and equipment in their work• Are employed by your company, which means you have legal and financial obligations to them • Are paid a salary or per hour, either weekly, monthly or bi-monthly • The company pays all employee taxes, federal and local tax deductions and social security• Can receive overtime, bonuses or other benefits in kind, which are all taxable deductions

EMPLOYEE

EMPLOYEE VS. CONTRACTOR: Legalities


Step 1: Contracts





Posters






Services



Full Review – The 4 Legal Steps to Hire an Employee

Sample Documents You Will Receive: Sample Contractor Contract Sample Offer Letter Sample Employee Contract Sample Confidentiality Agreement Sample Employee Handbook

What We Covered on Today’s Call

• Building Your Hiring Funnel• The Places We Recommend Looking for Good People

• Finding High Level Staff vs "Bit Players" is a completely different process and we'll show you how to do it• How to Hire People that Do Things that You Don’t Understand Completely.

• Designers, Coders, Developers, Finance, etc• How to make first contact and eliminate the wrong candidates right away.• How to Interview Confidently.

• Including our Simple Interview Guide with the questions you MUST ask every candidate

• The Legalities of Hiring • 2 Steps to Hiring a Contractor• 4 Steps to Hiring an Employee• What Legal Documents you Must Have and How Long to Keep Them

• The Simple Clauses that you need to Add that NO ONE THINKS OF (aka our "Asshole Clause")• Payroll Details including Taxes and the IRS

What Are We Covering on Next Week’s Call?Building a Happy Team!• The Secret to Onboarding Your Staff using Training Plans• The 7 Rules To Keep Your People Happy• How to Keep Your Team Productive Day in and Day out• 4 Examples (that you can steal) of how we Keep Our Staff Close (even those

that work remotely)• How to Develop Rockstars (Life Path Building and Stumbling Block Removal)• Benefits and Insurance - what is required vs what is nice (you'll be surprised at

what the law says here)• When and How to Fire Someone (including the exact words you should use)

session 2: finding and hiring the right talent. before we get started we’re going to move fast but...

Documents

big chunks step

goal step

step system

big chunks example

process flows breakdown

business process

process flow examples

course slide