Managing staff is a challenge for even the biggest of firms, which often have dedicated HR departments, employment law experts and the budget for recruitment and training. This is why the owners of small and medium enterprises (SMEs), only just venturing into the world of recruitment, can easily feel overwhelmed by the number of tasks involved.
You’ll know that a bad hire is costly and disruptive for any organisation, regardless of size. But when the success of your business, which you have built from the ground up, depends on just a few people, it’s only natural to worry about making mistakes.
Whether you’re recruiting for a new manager, casual worker or enlisting a family member to help out, our guide covers the basics of recruitment, employment law, the onboarding process and creating a positive workplace culture.
Employing people
One reason the move from self-employment to employer is daunting is because you’re handing over day-to-day tasks, while still being ultimately in charge. The ideal candidate has to be capable, trustworthy and committed to delivering impeccable service, so what’s the best way to find them?
Before posting an ad or engaging a recruiter, it’s a good idea to draw up a list of what you want from an employee. Certain qualifications, like a food hygiene certificate or forklift truck licence, may be a minimum requirement for the role but others, such as a degree, could just be desirable.
Creating a job description helps candidates decide if the job may be right for them. It should include details of the required skills and qualifications. Outline the specific duties and responsibilities of the role and how performance is measured. Provide an overview of the company and its values as well as salary details.
Consider too whether you’d be prepared to take on an apprentice and work with them to develop their skills.
It’s almost impossible to maintain a high standard of service when resources are stretched too thinly, so try to match capacity with demand. You can do this without investing in a permanent member of staff, especially if your company sees seasonal spikes or is commissioned on a project-by-project basis. While the initial outlay for a freelancer or agency worker tends to be higher, it could be less costly overall because they’re only there for a short period and you don’t have to make pension contributions.
Of course, the benefit of permanent employees is they should understand the business better and have strong relationships with customers. As you build your team, think about the skills and knowledge you need, both now and in the future – whether that be sales, digital, marketing or finance.
How to recruit
Global firms have tried innovative recruitment tactics, with some hosting events for talented individuals and using social media to provide a behind-the-scenes glimpse of company life. There are also plenty of examples of start-ups shaking up traditional recruitment with methods such as meeting candidates in settings other than offices and replacing standard job descriptions with cartoons.
Even if SMEs don’t have the same budgets, there are now multiple ways of uncovering new recruits. The list below is not exhaustive – but it should be a good starting point.
- Recruitment agency: The advantage of using a recruiter is they normally have a wide range of candidates and take away much of the legwork. While recruiter fees can be expensive, it could be a good investment if it enables you to save time and find the right person.
- Jobs boards There are many online jobs boards, including Indeed, Monster and local news sites. While costs vary, you can potentially reach millions of people and manage applications within a secure portal.
- LinkedIn (and other social media): Depending on your network, you might find an organic (free) LinkedIn or Twitter post with relevant hashtags is enough to generate interest in a role. If you want to reach more people, it’s worth experimenting with social media ads, although always set a spending limit to avoid high costs.
- Referral: Word-of-mouth recommendations are invaluable for many employers, and you may find the perfect candidate before they’ve even sent out their CV. They may offer financial rewards to encourage current staff to recommend talented former colleagues and friends too.
- Apprenticeship scheme: Taking on an apprentice is extremely rewarding, as long as their training is structured, and you’re able to give them time out to study. The government website sets out what to consider before introducing a scheme.
Legal responsibilities
Complying with employment law can feel overwhelming for any small business, particularly those taking on staff for the first time. Covering everything from health and safety to pay and discrimination, the legislation is complex and ever-changing, and the repercussions for breaking the law could include financial penalties, lost earnings, damage to reputation and even imprisonment.
By exercising due diligence from the start, you’re well-placed to protect both your staff and business. The government website sets out your obligations, including details of the National Minimum Wage, right to work, pension enrollment and registering with HMRC. You’ll also find a wealth of information from the HSE (Health and Safety Executive) on reducing the risk of work-related accidents and illnesses.
It’s a good idea to ask a solicitor to draw up and regularly review employee contracts – search the Law Society database if you don’t have one already or ask for a recommendation from someone you trust. Many contracts contain standard clauses about pay, working hours and notice periods but a solicitor can make sure the language is clear and difficult to dispute in court.
Acas – an independent body funded by the government – provides advice for employers on contracts, hours and pay, holidays and disputes. It also offers free arbitration services, along with mediation and early conciliation services in order to avoid expensive tribunals.
Whatever your plans to scale up, always get the processes in place to stay compliant. Outsourcing payroll and accounting to a professional, or using industry software, is a good way to ensure you’re making the right PAYE and pension contributions, and managing complex overtime payments.
Taking on anyone means trusting them with confidential company information about finances, customers and growth strategies. This is why many companies ask for references from past employers and run DBS checks to see if candidates have a criminal record. Experian background checking services also help you to recruit with confidence by identifying warning signs such as convictions and adverse financial history. We also run right to work checks – a key priority for any employer, given they could be fined up to £20,000 per illegal worker
Managing your team
Once a candidate has accepted an offer, the next challenge is to develop their skills and give them a reason to stay. Job hopping may have become a fact of life in recent years, but it can still be costly and disruptive for employers, especially when they lose a highly-skilled staff member.
Safeguarding your business from the impact of high turnover starts with good onboarding. The impression you make in those crucial first few days could be the difference between them becoming a dedicated and loyal employee, or feeling bored and wishing they had taken another job elsewhere.
Successful onboarding ensures that the time and money you spent recruiting pays off. No matter how busy you and your team are, always take the time to make a new-starter feel welcome as it reassures them that they made the right decision. Here are just a few ideas to build into this process:
- Create an induction plan: A structured plan gives new employees something to focus on immediately. Wherever possible, pair them up with another member of staff (it could be you in the first instance), who can give an overview of policies and procedures as well as answer any questions. Introduce them to any members of the wider team, whether this be in person or virtually via video calls, and delegate work as soon as possible – after all, nobody likes being left with nothing to do. Just as important is telling the story of the business, including when it was founded and future growth plans, as it helps them feel part of the journey.
- Set clear expectations: Every company has its own set of rules, so ensure they’re well-communicated. It could be anything from uniforms and dress codes to what time staff start and finish, and whether there’s any flexibility. Explain the steps they can take to progress, for example, obtaining a qualification or hitting their targets, and how performance is measured through appraisals and bonus schemes.
- Tools for the job: The enthusiasm of any new-starter can quickly disappear if they find they do not yet have a computer, or are unable to access the system. Make sure this doesn’t happen in your company by preparing their workstation in advance, setting up log-in details and providing all the necessary equipment.
Once onboarding is complete, an employee’s decision to stay will at least partly depend on your skills as a leader and manager. You should provide support and be available if they want to chat, without falling into the micro-management trap. Management training, is extremely valuable, especially if you have relatively little experience of leading a team.
Workplace culture
Given how much time people spend at work, and the impact it has on their health and happiness, it’s no surprise that more employers see the benefit of a positive workplace culture.
What this looks like depends on the size and type of company – but it tends to involve developing a space where staff feel comfortable, secure and able to express themselves (while maintaining professionalism). It covers everything from physical working environments to transparent processes, and a willingness to learn from mistakes. Staff should be encouraged to collaborate, try new things and hone their skills, whether through formal training, mentoring or shadowing.
Although a strong workplace culture might take years to grow organically, effective leadership means you can lay the groundwork from the start.
Growing with your team
As you’ll discover, growing a successful team is more of an art than a science and there will be plenty of surprises along the way – both good and bad. Even experienced employers sometimes mis-judge a candidate’s abilities and soft skills, which is why most contracts have a probation clause. While you can never completely safeguard your business against poor productivity, high turnover and disputes, sound recruitment and management processes enable you to stay on track.
Understanding your legal obligations is the first step, the next is to make sure your new starter feels valued and able to work to the best of their abilities. You’ll need to invest in their professional development and be flexible if they suffer ill health or personal problems – but, with good leadership, you should be rewarded with a team that exceeds your own capabilities.