All the answers to your unique business lifestage questions
When a small business gets big enough to need more than one "driver", it can be hard to adjust.
When you are ready to start hiring help, here's how to minimise the worry.
- Grow with your business: Analyse the level of help you need, the kind of manager you are and the changes you will need to make to allow a new person to enter the business.
- Don't just offload chores: Hiring is a decision to grow your company, and is not just about getting someone to help you with the overload. Before hiring, tap into the knowledge of other small business owners who have been through the process and think carefully about your strategy for the next few years.
- Make a list of tasks: List the company's critical responsibilities and decide what only you can do, what you prefer to do and what you can delegate. Choose a title and formulate a detailed job description for the new position.
- Set expectations for performance: Make sure you are prepared to offer ongoing and constructive feedback.
- Don't rush it: Get a feel for your business cycle - the good months and the bad. Experts suggest saving at least a year's worth of expenses and overheads before you hire, to see you through any rough patches.
- Hire attitude, not skills: If a person is smart, eager and open-minded, training will come easily - especially in a multitasking small business. You will be spending a lot of stressful time together, so choose someone who has a business approach and entrepreneurial spirit that complements yours.
- Don't wait for perfection: A first-time hire must be able to do several things well - not one thing perfectly. If your first choice turns out to be the wrong one, just chalk it up to experience and then keep recruiting.
Employee benefits: yes or no?
A prospective employee is most concerned with the net or take-home salary. The small business owner, on the other hand, must focus on total cost to company. Calculate what a new employee is going to cost in terms of salary, tax, levies, investment (such as training, new equipment) and benefits.
Some companies now offer healthcare and/or retirement packages specifically structured for cash-strapped small businesses. It's worth doing your homework, because offering employee benefits can have some financial advantages:
- Plan contributions are tax-deductible.
- Setting up plans for staff might net you better benefits for less money than paying for your own plan alone.
- Some employees might accept certain benefits as a substitute for higher salaries or raises.
Too small for labour law? Think again
Most employers and employees in South Africa, regardless of business size, are subject to the provisions of the Basic Conditions of Employment Act (BCEA) and Labour Relations Act. These stipulate the minimum terms on which any employee must be employed in terms of leave, overtime, working hours and payment, among others. They also provide strict guidelines on dismissal, retrenchment and dispute resolution procedures.
With respect to small business, the Acts cover prospective employees (job applicants) as well as former employees, but NOT independent contractors, ie, people who sell their services to the public and who do not fall under the control of an employer. Businesses with 50 employees or more are also subject to the Employment Equity Act, which requires the company to have a formal policy or affirmative action programme in place.
Certain industries may, by their nature, involve different employment conditions to those prescribed in the Act, and the BCEA makes provision for this either through special agreements with trade unions, individual agreements with employees or formal variations granted by the Minister of Labour.