A Step-By-Step Guide On How To Hire Your Employees

There are certain legal requirements that you must fulfill in order to hire your employees. Therefore, it is very important for you to have a thorough knowledge about the regulatory requirements applicable in your state regarding this. If you have started a new business and it is the first time you are going to hire some employees, you will find the following information very helpful.

Obtain EIN

EIN stands for Employer Identification Number (also commonly known as Form SS-4 and Employer Tax ID). You can contact the IRS office or visit their official website on Internet to apply for it. You need EIN before you start hiring employees. You will need to use this number to report information about your employees to the state agencies and to report taxes to the IRS.

Keep Records Of Employment Taxes

The next step to the procedure to hire your employees is to create a system that should enable you to keep records for withholding taxes. As per the federal laws, you must keep the records for a minimum last 4 hours. Keeping this record is also helpful in keeping your business operations smooth, as it helps you in an array of different ways, such as in supporting items reported on tax returns, preparing your tax returns, keeping track of deductible expenses, identifying source of receipts, preparing your financial statements, and monitoring the progress of your business.

Complete Form-I9 For Employee Eligibility Verification

As per the Federal business laws, you must also complete a form-I9 in order to get the eligibility of your employees verified properly whether they are eligible to work in the US or not. You must complete this form within three business days after you hire your employees. However, you do not need to submit this form to the federal government. The laws just require you to keep this form for at least three years from the date of appointment. The government official may ask you to present the record during the routine workplace audits, which is often conducted by the U.S. Immigration and Customs Enforcement (ICE).

Registration For Unemployment Insurance Tax

There are certain conditions, when you may be legally obligated to pay a specific amount as unemployment insurance taxes. If those conditions are applicable to you, you must first get your business reregistered with the workforce agency of your state.

Insurance To Workers’ Compensation

As per the business laws applicable in the United States of America, in order to hire your employees, you must also obtain proper Workers’ Compensation Insurance coverage either through the state Workers’ Compensation Insurance program or through a commercial carrier on a self-insured basis.

New Hire Reporting Program Registration

There is a state directory, known as New Hire Reporting Program, where you must register the basic information about your newly hired or re-hired employees within twenty days from the date of their appointment. This specific business law came into effect with the introduction of the Personal Responsibility and Work Opportunity Reconciliation Act in the year 1996.

Disability Insurance

Though not always mandatory, but in specific situation, you may also be required to obtain disability insurance coverage for the eligible employees. The insurance provides protection to your employees against non-work related injury or sickness. At present, if your employees are living in Rhode Island, Puerto Rico, New York, New Jersey, Hawaii, or California, you will be required to purchase this insurance.

As you can see, there are several legal requirements that you need to fulfill when you hire your employees. Make sure you follow the above steps thoroughly to ensure smooth functioning of your business without any legal hurdle.