How to hire the best employees: Essential tips

1Make sure you have everything legal in order

What does an employer need to hire someone? Good question: There are several legal requirements for hiring employees.

To get started, here’s a quick list of documents you should have ready before hiring your first employee.²

• Employer Identification Number (EIN). When you run a business, an EIN is how you can identify your company to the IRS. This tax ID number is required for businesses with employees.
• Employment Eligibility Verification: Also known as Form I-9, this form is filled out by the candidate and verifies they are legally authorized to work in the United States.
• Other candidate tax forms: Forms such as W-4, which provide the employer with the employee's tax information.
• State or local tax IDs. Tax obligations differ from state to state. Check with your local tax office to figure out if you need a state or local tax ID.
• Employee handbook. This can serve as a helpful guide to outline your company's policies, procedures, and expectations for new and existing hires.
• Non-disclosure agreement. Some companies provide non-disclosure agreements to protect confidential company information.

Keep in mind that this is just a starting point. It's a good idea to talk to your accountant or business manager to make sure you're on top of all your obligations.

It's also important to take some time to learn about employee rights. Employer.gov offers plenty of resources that can guide you.

2Define the hiring process

Building a streamlined hiring process can help attract the right candidates and increase your chances of making successful hires.

Here are some things to consider as you create your hiring process:

• Identify the different channels where you’ll post the job opening.
• Determine who will be involved in the hiring process, such as HR managers, hiring managers, and department heads.
• Establish a frictionless process for evaluating applications, including reviewing resumes and cover letters, and conducting phone or video interviews.
• Define the different phases of the selection process, which may include additional interviews, reference checks, and skills assessments.
• Decide how the final selection will be made and who will be responsible for making it.

3Write a good job description

Think of a job description as a first impression. It has the power to either attract top talent or turn them away. Take the time to craft a compelling and accurate description highlighting your company's strengths and setting the tone for a successful hiring process.

Not sure where to start? Here are some must-haves in your job description:

• Brief company overview
• Main responsibilities of the role
• Business or department goals related to the position, so candidates can see how their work would fit into the larger company framework
• Required education, years of experience, and/or technical skills
• Quick summary of benefits, including healthcare and paid time off
• Location (i.e., on-site, hybrid, remote)
• Employment type (i.e., full-time, part-time, contract)
• Travel requirements

Take your job description to the next level by including additional information like:

• Salary range (some states require this to be included, so check your local regulations)
• Career development opportunities and/or tuition reimbursement
• Performance expectations
• Company retreats and special perks

4Find your candidates

In today’s digital-savvy world, there are several ways you can find candidates for an open position.

Here are some ideas to get started:

• Publish online job postings on LinkedIn, Indeed, and/or other job boards and industry-specific websites.
• Create an in-house careers page on your company’s website.
• Develop a referral program for current employees to recommend talent.
• Use an external staffing or recruiting agency to source talent.

5Prepare the interview

Depending on your hiring process, you may decide to interview candidates multiple times with different people in your organization.

If that’s the case, make sure every candidate undergoes the same interview procedure to ensure the hiring process is fair and balanced. For instance, if candidate A has three interviews (with the recruiter, hiring manager, and department head), candidate B should do the same.

Follow these best practices for conducting interviews:

• Review the candidate's materials (resume, cover letter) in advance.
• Develop a list of open-ended questions to evaluate their skills and qualifications. Keep this list for every candidate you interview for the position.
• Make sure the candidate has a clear understanding of the job responsibilities, the company culture, and any benefits or perks that come with the position.
• Encourage the candidate to ask questions.

6Test your candidates

Depending on the role, you may choose to ask candidates to complete a sample test relevant to the position they’re applying for. Besides interviews, this can be a valuable tool, helping you identify top candidates and weed out those who may not be the best fit. Plus, you’ll also get a better idea for their creativity, attention to detail, and ability to work under pressure.

For example, if you're hiring for a copywriter, you could ask candidates to write a sample blog with corresponding email copy and social media posts.

7Perform reference checks

Running reference checks is one of the most important steps of the hiring process. It’s your chance to verify the information provided by the candidate, gain insight into their strengths and weaknesses, and ensure that they are a good fit for the position and your company culture.

Here are some example questions you can ask during a reference check:

• Can you confirm the candidate’s job title, role, and start and end date at your company?
• How would you describe their communication style and work ethic?
• How do they handle pressure and difficult situations?
• Can you discuss their strengths and areas for improvement?
• Would you rehire the candidate if given the opportunity?
• Is there anything else I should know about them?

8Report your new hires to your state employment agency

Federal law requires businesses to report new hires and rehired employees to your state’s labor agency.

Typically, you’ll be asked to provide your business’ EIN as well as the employee’s name, date of birth, address, date of hire, and social security number.

9Obtain workers’ compensation insurance

Many employers obtain workers' compensation insurance to cover their employees in case of work-related injuries or illnesses. However, the specific requirements can vary depending on the state in which the business operates.

10Prepare the onboarding process

Onboarding could have the power to make or break your new hire’s experience and impression of your company. Make sure the process is as smooth and frictionless as possible.

Start with these steps:

• Send a welcome email.
• Share your employee handbook and highlight important policies, procedures, and benefits.
• Supply necessary forms and documents, such as tax forms, bank account information, and emergency contacts.
• Provide access to resources like shared drives and project management tools and supply a company computer (if necessary).
• Conduct an orientation session. Introduce the new hire to their team members and other colleagues.
• Discuss the new hire's long-term goals and how they can contribute to the company's success.
• Provide opportunities for the new hire to participate in company events and social activities.
• Schedule follow-up meetings to track the new hire’s progress.

Now that you’ve experienced the hiring process, explore these tips to manage your employees. Plus, get more helpful resources to run your business, from cash flow management to growth strategies.