One of the most common questions I get asked by clients is what they need to do when hiring a new employee. Being that it is an area that can cause a lot of issues for a small business if not done correctly, I have developed this handy list of all the things to do when hiring a new employee.
1) Ensure a Tax File Number Declaration form is completed and returned to the ATO
2) Provide a Super Choice Form that allows the new employee to highlight their desired Superannuation Fund, be it their own personal fund or the default fund used by your business
3) Refer to the relevant Modern Award or Enterprise Bargain Agreement for the correct pay rates and conditions for the role, including leave entitlements, overtime/penalty rates, allowances and work hours
4) Have a Contract or Letter of Offer drawn up outlining all of the relevant details of the role and ensure it is signed by both parties
5) Gather the following information to ensure correct setup in your payroll system:
* Name, Address and preferred Contact Details
* Date of Birth
* Agreed Salary or Hourly Rate of Pay
* Employment Classification
* Tax File Number and Tax Free Threshold preference
* Entitlements
* Superannuation Fund details
* Pay Period, ie, Weekly, Fortnightly or Monthly
* Bank Account Details for electronic payments
* Any other required deductions, such as additional salary sacrificed super, child support, additional PAYG Withholding, etc
Making sure you are organised at the time you decide to hire a new employee can make the process a smooth and enjoyable one for all concerned. Also, if you have a bookkeeper who takes care of your payroll for you, having all of the above details ready for them to enter straight into the payroll system can reduce a lot of time and potential errors down the track.