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Home Business Magazine Online arrow Management arrow Employee Matters arrow Growing Pains
Growing Pains PDF Print E-mail
Written by Jodi Helmer   
home based business
home based business

Hiring Employees in a Home-Based Business

Home-based business owners act as consultants, accountants, customer service managers, web masters, and secretaries. When the business is just starting out, it may be feasible to take on multiple roles, but when working nights and weekends becomes par for the course, it’s probably time to hire some help. Hiring employees can give home-based business owners time to focus on growing the business while someone else helps to lighten the workload.

Free Up Your Billable Hours
“Many business owners think, ‘If I had someone to go to Office Depot to buy paper, I could make more money,’” says Wally Bock, a consultant who helps businesses increase their profitability. “And they’re right.”

Bock encourages home-based business owners to hire employees to do what he refers to as, “laundry.” “Every business has laundry – things that have to be done because you can’t do business without them, but that no one is getting paid for,” Bock explains. Hiring someone to confirm appointments, make reservations, buy office supplies, and stand in line at the post office will allow home-based business owners to free up billable hours and increase their profits.

Do not limit potential employee support to just clerical/laundry type support. When you need support to grow your business, your first choice should be to outsource or form ventures with others to provide that support. But you can lose control and potentially equity with those options. That leaves you with hiring an employee(s) to provide more sophisticated support beyond clerical help. Keep these employee options open, as you don’t have to have employees working out of your home, as will be discussed in the article.
 
Finding the Right Match
“I was writing, teaching, conducting workshops, and running the business,” says Frances McGuckin, owner of Smallbizpro.com Services, a consulting firm specializing in helping small businesses grow. “It got to the point where I couldn’t do it all. I needed someone to do the time-munching chores that were preventing me from expanding my business.”

McGuckin decided to hire a bookkeeper and placed an ad in the local paper. She says she received dozens of resumes. Ultimately, McGuckin chose to hire a woman she met while teaching a class and says the experience of hiring an employee was, “very rewarding.” 

When the time came for human resources consultant Arlene Vernon to hire an assistant to work out of her home-based business, HRx, she says she consciously chose not to advertise the position. “I wasn’t comfortable bringing [a complete] stranger into my home,” she says. Instead, she looked for someone at networking groups and professional associations, and sought out colleague recommendations.

Jill Lublin turned to a staffing agency for assistance in finding a part-time administrative assistant to work in her home office. “It’s important to have the right match,” says the CEO of Promising Promotion and author of Guerrilla Publicity. The staffing agency screened candidates, conducted interviews and ran criminal background checks, and as a result, Lublin found the right employee without all of the legwork.

For employers who prefer to interview and screen potential candidates themselves, Bock strongly suggests running a full background check on all potential employees. “I check references, run a credit report, and do a criminal background check whenever I’m hiring someone to work for me,” says Bock. “Everyone should do it.”
                                                                                                                                               
Setting Boundaries
While it can be a huge relief to have a helping hand in the office, home-based business owners admit that sharing a once private home office with an employee can be challenging. “I’m used to my privacy,” says Vernon. “You lose that when there is someone else working in the office with you.”

Anyone who’s going to work in a home office has to be flexible; they can’t be bothered if the bed isn’t made,” Lublin adds. “They have to be able to work regardless of what’s going on in the house.”

Like most home-based business owners, Vernon provided access to common areas of the house, including the kitchen and the bathroom, but drew the line at giving her employees a key to her home. Instead she gives them the code to the garage door which provides access to her home. “It’s easy to change the [garage door] code,” she says. “But who wants to change all of the locks?”
 
Setting Up Shop
When preparing to bring an employee into a home office, Bock says employers must be prepared to provide an adequate workspace and the proper tools to do the job. “If you want business results, you need to treat it like a business,” he says. “If you can’t afford a computer for your employee, you’re probably not ready for staff.” 

For business owners working out of tight quarters, Bock suggests examining the possibility of employees working out of their own homes. “A lot of people don’t want someone to work from their home office,” says Bock. “And it may not even be necessary.” Bock says that bookkeeping, sales calls, errands, and numerous other duties do not require an employee to work in the same space as their employer. “The person may only need to come to your home periodically,” says Bock.

With the Internet, e-mail, and modern computer and office technologies, you can set up an employee at their own home or location, and it will be seamless. They would work as if located at your home location. You would just have to get together for coordination and update meetings. Phone lines can be set up so that incoming phone calls are cross-connected with a business phone system, giving the appearance that your employee worked at your location.

Watch the Legalities
Consult with your attorney, accountant, and insurance agent prior to hiring a new employee. Look into drafting and signing employee agreements. This will help limit your liability in case your employee does not work out and has to be terminated. Ensure that your company complies with all local, state and federal employee regulations. Check into insurance requirements, such as liability and worker’s compensation.
 
Another Hiring Option
 “I didn’t want to juggle my home office to accommodate an employee,” says Vernon. “I also didn’t want to mess with payroll and taxes.” For Vernon, the solution was to hire independent contractors to perform duties ranging from graphic design and administrative support to bookkeeping and accounting. 

According to Vernon, the benefit of working with independent contractors is the ability to hire help on an as-needed basis from contractors who work from their own homes and are responsible for their own taxes. 

Lublin also frequently hires independent contractors and says, like Vernon, she benefits from the flexibility of hiring out projects as needed. Though the roles of independent contractors and employees vary, Lublin says there is a common thread. “My focus is on having great people produce positive results.”

“We’re not the HR department of a major company; we’re much more intimate,” says Bock of hiring an employee in a home-based business. “When you bring someone on to help with your business, it’s a human relationship. You will end up with a friend as well as an employee.” HBM

Jodi Helmer’s work has appeared in numerous publications on the local and national levels. Visit www.jodihelmer.com. 



Are You Ready to Hire an Employee?
 
Before home-based business owners start interviewing potential employees, McGuckin suggests asking a few questions.
 
1) Are you boss material? Many home-based business owners have been running their businesses single-handedly for years and may have little or no experience with managing employees. “It’s difficult to be a good boss,” warns McGuckin. “It takes a lot of work.” For employers with no previous management experience, McGuckin suggests finding someone with experience managing employees – for guidance.
 
2) If I hire an employee, what tasks will they perform? McGuckin strongly encourages home-based business owners to consider what role an employee will play in their business and to create a job description based on those needs. “Make a list of the jobs that waste your time and expertise,” she says. “And then look for someone who can do those things.”
 
3) What are the conditions of employment? In addition to outlining job duties, employers must also consider the conditions of employment, including wages, benefits, vacation time, and hours of work. “Conditions of employment should be outlined in the job description,” says McGuckin, who points her clients to the local Department of Labor for information.
 
Check the Laws
The laws for hiring employees in a home-based business vary from state to state. To be sure you’re operating legally, McGuckin suggests accessing up-to-date information through the State Department of Labor or local Chamber of Commerce. HBM


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