From one small business owner to another, expanding to the point that you have to start taking on employees is a big step. But before you expand, there are a few things you should know about the move from a sole proprietor to an employer.

  1. Employment Eligibility – You can’t hire just anyone. You need the person to fill out an I-9 form to confirm they are eligible to employed by your business. Accidently hiring an illegal or undocumented worker can lead to heavy fines.
  2. Withholding Taxes – You have to withhold federal income tax from all of your employees. This is a change if you have only worked with freelancers in the past.
  3. Insurance Coverage – Are you required to carry workman’s comp or unemployment insurance? Find out in advance so this isn’t a surprise expense.
  4. Wage and Hour Rules – California has state laws regarding the breaks and overtime pay employees should receive based on the number of hours they work per day and per week. You even have to pay your employee for unused vacation days if you fire them.
  5. Anti-Discrimination Laws – You can’t discriminate against an employee due to disabilities, age, gender, sexual orientation, race, or anything else for that matter. These laws also protect employees from a hostile work environment.

Help for San Diego’s Small Business Lawyers

Pokala Law is a small business lawyer in San Diego that helps other small business owners understand employee rights among other matters, so you know that your business is being handled properly from day one. To get started, contact us at 1-844-695-1487.