First Time Hiring? Your Complete Checklist for Getting It Right

Before you begin: Do you really need to hire?

Hiring is expensive and time-consuming. The average cost to hire an employee is $4,700, and the process takes about 44 days from start to finish. With this in mind, take a step back and evaluate whether hiring is the right move for your business right now. Consider whether you could outsource the work, automate certain tasks or reorganize current responsibilities. 

Ask yourself these questions: 

• Is this a consistent, ongoing need or a temporary spike in workload? 
• Do I have enough revenue to sustain an additional salary and benefits long-term? 
• Can I clearly define the responsibilities for this role? 

If the answers point to a genuine, sustainable need for help, it’s time to move forward with your hiring checklist.

Step 1: Set your budget and understand the true costs

Recruitment costs aren’t the only thing you’ll incur when bringing on a new hire. Consider the following expenses when building your budget to understand the true costs of hiring a new employee:

• Salary and wages. Research market rates for similar positions in your area and industry. As a general estimate, entry-level positions typically require hiring costs of between 10 and 30 percent of the employee’s annual salary. Mid-level roles and executive positions will likely cost even more.
• Benefits and payroll taxes. On average, benefits cost employers nearly 30% of employee salaries, according to June 2025 data from the U.S. Bureau of Labor Statistics. This includes health insurance, retirement contributions, paid time off and legally required benefits like Social Security and Medicare taxes.
• Workers’ compensation insurance. Nearly every state requires businesses to carry workers’ compensation insurance, even for their first employee. Texas is the only exception.
• Equipment and workspace. Factor in the cost of computers, phones, software licenses, office supplies and any physical workspace modifications needed.
• Training and onboarding. Companies commonly spend upwards of $1,000 on each employee’s training, plus the productivity cost of getting new hires up to speed. New employees typically take several weeks to reach full productivity.
• Ongoing overhead. Consider how hiring will affect your rent, utilities, and other operational costs.

Calculate whether your current revenue can sustain these expenses before you post a job. A realistic budget prevents you from making promises you can’t keep or rushing to hire the wrong person because you need immediate help.

Step 2: Obtain your Employer Identification Number

If you don’t already have one, you’ll need an Employer Identification Number (EIN) from the IRS before you can legally hire employees. An EIN is a nine-digit number that identifies your business for tax purposes, similar to a Social Security number for individuals.

All businesses that hire employees must have an EIN, even sole proprietorships. You can apply for an EIN online through the IRS website using Form SS-4. The application is free and you’ll receive your number immediately upon completion.

Your EIN is essential for paying payroll taxes, filing tax returns, opening business bank accounts, and complying with other employment requirements. Get this squared away early so it doesn’t delay your hiring process later.

Step 3: Register with your state agencies

Each state requires employers to register with various agencies before hiring. While specific requirements vary by location, most employers need to:

• Register for unemployment insurance. You’re federally required to register for unemployment insurance if you hire at least one employee who will work more than 20 weeks per year or earn more than $1,500 in any quarter. You’ll make quarterly unemployment insurance payments based on employee earnings. You may be subject to additional state unemployment tax requirements as well, depending on where your business is located.
• Obtain workers’ compensation insurance. Every state except Texas requires employers to carry workers’ compensation coverage from the first employee. This insurance provides support to employees who are injured or become ill due to workplace incidents.
• Register with your state’s new hire reporting program. You must report new hires to your state’s registry within 20 days of their start date. This federal requirement helps track wages and enforce child support obligations. The deadline may be shorter depending on state law where your business is located.

Contact your state’s Department of Labor or employment agency to understand all requirements specific to your location. Some states require additional registrations for disability insurance or other programs.

Step 4: Create a clear job description

A well-written job description is the foundation of successful hiring. It helps you find employees who truly fit the role and gives candidates a clear understanding of what you expect from them.

Your job description should include:

• Job title and summary. Use a standard title that job seekers recognize. Follow with two or three sentences explaining the role’s purpose and how it contributes to your business goals.
• Key responsibilities. List the five to eight most important duties this person will perform. Use action verbs and be specific about what success looks like.
• Required qualifications. Include only the skills, experience and education that are genuinely necessary to perform the job. Overly long requirement lists discourage qualified candidates from applying.
• Desired qualifications. List nice-to-have attributes separately so candidates understand what’s required versus what would be a bonus.
• Salary range and benefits. Transparency about compensation has become increasingly important, with many jurisdictions now requiring salary ranges in job postings. Even where not required, including this information attracts more qualified applicants and saves time.
• Your company culture. Briefly describe your business, values and work environment so candidates can determine if they’d be a good fit.

Keep the description concise and focus on what makes this opportunity appealing. Remember, you’re not just evaluating candidates, they’re also evaluating you.

Step 5: Choose where to post a job

Once your job description is ready, you need to get it in front of qualified candidates. For first-time employers, choosing the right platforms matters because your budget is limited and you can’t afford to waste time sorting through unqualified applicants.

• Online job boards remain the primary way most people find job opportunities, allowing you to reach large audiences of active job seekers. Many job boards now offer applicant tracking systems (ATS) as part of their service, which is particularly valuable for first-time employers. ZipRecruiter’s built-in ATS, for example, manages applications, tracks candidate progress, and stores all hiring documentation in one place. This gives new employers a professional hiring infrastructure without requiring separate software or technical expertise.
• Your company website should always host your job posting, even if you advertise elsewhere. While few candidates apply directly on company websites these days, having the listing posted on your site adds credibility and gives interested candidates a place to learn more about your business.
• Social media and professional networks can help you reach passive candidates who aren’t actively job hunting but might be interested in the right opportunity. Share your posting on your business’s social media accounts and ask your network for referrals.
• Industry-specific job boards and local community boards can be effective for specialized roles or when you want to hire locally.

Step 6: Use pre-written templates to streamline the process

As a first-time employer, you don’t need to reinvent the wheel. Using templates for common hiring documents ensures you include all necessary information while presenting a professional image.

Look for templates for offer letters, interview question guides, and evaluation forms. Many recruiting platforms provide pre-written templates customized for different roles and industries. These templates are designed by HR professionals and updated to reflect current employment laws, reducing your risk of legal missteps.

Templates save significant time and help ensure consistency, especially important if you’ll be hiring multiple people as your business grows. You can customize them for your specific needs while maintaining a professional foundation.

Step 7: Review applications and screen candidates

Once applications start coming in, you’ll need a system for evaluating them fairly and efficiently. Corporate job postings receive an average of 250 applicants, according to Glassdoor, though your numbers as a small business will likely be lower.

Create a simple scoring rubric based on your job description requirements. Review each application against these criteria rather than comparing candidates directly to each other. This reduces bias and keeps you focused on job-related qualifications. 

Many applicant tracking systems automatically score and rank candidates based on how well their qualifications match your requirements. This technology helps new employers identify the most promising candidates quickly, especially valuable when you’re juggling hiring alongside running your business.

Look for candidates who demonstrate genuine interest in your specific role rather than those who appear to be applying to every job they see. Personalized cover letters, researched questions about your company and relevant experience all signal serious candidates.

Step 8: Conduct phone screens before in-person interviews

Phone screening helps you narrow your candidate pool before investing time in lengthy interviews. Plan for 15 to 20 minute conversations covering:

• Why the candidate is interested in this specific role
• Their availability and salary expectations
• Key qualifications and experience related to your requirements
• Any potential red flags like unrealistic expectations or communication concerns

Prepare consistent questions for all candidates to ensure fair evaluation. Phone screens give you a sense of communication skills and professionalism while verifying that basic requirements are met before moving to the next stage.

Step 9: Prepare and conduct structured interviews

Interviews are your opportunity to assess whether candidates can do the job and whether they’ll fit well with your company. Structure your interviews to gather the information you need while giving candidates a chance to learn about the opportunity.

Develop five to 10 core questions that all candidates will answer. Focus on behavioral questions that ask candidates to describe how they’ve handled situations similar to what they’ll face in your role. These questions typically begin with “Tell me about a time when…” or “Describe a situation where you…”

Take notes during each interview using a consistent format. This documentation helps you compare candidates objectively and protects you if hiring decisions are ever questioned.

Remember to comply with employment laws during interviews. Avoid questions about age, marital status, children, religion, national origin, disabilities or other protected characteristics. Focus entirely on job-related qualifications and the candidate’s ability to perform the role.

Step 10: Check references and verify information

Before making an offer, verify the candidate’s employment history and qualifications. Reference checks help confirm that candidates are who they claim to be and can perform as expected. A bad hire can cost up to 30 percent of the employee’s salary when you factor in lost productivity, training time and the expense of starting the process over — checking references can help you avoid hiring the wrong candidate for the job.

Contact at least two professional references, preferably former managers or colleagues who worked directly with the candidate. Ask about job performance, reliability, strengths and areas for improvement, and whether they would rehire the person.

For positions requiring specific credentials, verify licenses, certifications and educational degrees. The cost of a bad hire makes this verification worthwhile.

Background checks require the candidate’s written consent under the Fair Credit Reporting Act. If you choose to conduct criminal background checks, research your state’s laws carefully, as many states restrict how and when you can consider criminal history in hiring decisions.

Step 11: Prepare required new hire paperwork

Before your new employee starts work, prepare all legally required documents. Missing or incorrect paperwork can result in significant fines and compliance issues.

• Federal Form I-9 verifies that employees are legally authorized to work in the United States. All employees must complete this form, regardless of citizenship status. You must review the employee’s documentation and retain the form for three years after hire or one year after termination, whichever is longer.
• Federal Form W-4 provides the information needed to calculate federal income tax withholding from paychecks.
• State and local tax forms vary by location. Check with your state’s tax agency for required paperwork.
• Required workplace posters must be displayed where employees can see them. These posters inform workers of their rights under various employment laws. The Department of Labor provides free posters, or you can purchase compliance poster sets that include all federal and state requirements.

Many states require additional new hire notices covering topics like paid leave policies, workers’ compensation, unemployment insurance and anti-discrimination protections. Research your state’s specific requirements or consult an employment law resource.

Step 12: Develop a simple employee handbook

While not legally required, an employee handbook is one of the smartest investments a new employer can make. A handbook sets clear expectations, ensures consistency, and provides legal protection for your business.

Your handbook should cover:

• Work schedule and attendance policies
• Paid time off and sick leave
• Standards of conduct and dress code
• Anti-discrimination and harassment policies
• Disciplinary procedures
• Confidentiality requirements
• Technology and social media policies

Keep it simple for your first version. You can always expand as your team grows and new situations arise. Have an employment attorney review your handbook before distributing it to ensure compliance with federal and state laws.

Step 13: Make a competitive offer

When you’ve identified your top candidate, it’s time to make an offer. Your offer should be competitive enough to attract the candidate while fitting within your budget.

Include these elements in your offer:

• Job title and start date
• Salary or hourly rate and pay schedule
• Benefits overview with details to follow
• Work schedule and location
• Employment at-will statement (in most states)
• Conditions of employment, such as passing a background check

Present the offer verbally first, then follow up with a written offer letter. Give the candidate a reasonable deadline to respond — typically three to five business days for most positions.

Be prepared to negotiate. Know your maximum salary and which benefits are flexible versus non-negotiable. Many candidates will ask questions or request modifications, and some flexibility can help you secure top talent without breaking your budget.

Step 14: Plan your onboarding process

An effective onboarding process improves new hire retention and productivity. Create a simple onboarding plan that covers:

• Day one logistics. Ensure workspace, equipment and login credentials are ready before the employee arrives. Have them complete all paperwork, review the employee handbook and tour your facility.
• First week training. Introduce the new hire to key people they’ll work with, explain your products or services in detail and begin training on essential job functions.
• First month goals. Set clear expectations for what the employee should accomplish in their first 30 days. Schedule regular check-ins to answer questions and provide feedback.
• 90-day review. Plan a formal review at the three-month mark to discuss progress, address any concerns and set goals for ongoing development.

Even simple onboarding significantly impacts whether new hires stay and succeed. Dedicate time to doing this right rather than throwing new employees into the job without guidance.

Step 15: Set up your ongoing compliance

Hiring your first employee creates ongoing obligations that you’ll need to manage. Set up systems to handle:

• Payroll processing. You can use payroll software, hire a payroll service or work with an accountant. Ensure you’re withholding the correct amounts for federal and state taxes, Social Security and Medicare.
• Tax payments and filings. You’ll need to deposit payroll taxes regularly and file quarterly returns. Missing deadlines results in penalties.
• Record keeping. Maintain accurate records of hours worked, wages paid, taxes withheld and employment documents. Many states require specific records to be kept for several years.
• Continuing legal compliance. Employment laws change frequently. Stay informed about new requirements affecting employers in your state and industry.