So when a company gets to a point where they’re ready to hire their first employee, they often come to us asking what documents or what series of documents do I need and what else do I need to do to actually get an employee on the payroll?
A few things, all employers in the state of New York need workers compensation insurance and disability insurance. Failure to have either one of them results in a whole bunch of penalties and for the right reason. The state wants to ensure that employees are covered and you as an employer want to as well. So you would work with either an insurance broker or the New York State Insurance Fund or others to secure the proper insurance.
There’s also a registration that’s required to obtain what’s called an employer registration number that also operates as your unemployment insurance number as well. And that’s obtained through the Department of Labor. Often if you work with a payroll service provider, like Paychex or an ADP, they will help you and assist you with that registration and obtaining that number because it’s something that needs to be inserted on all the tax returns and forms that you file with New York State.
When actually going to make an offer to an employee, we recommend that a formal offer letter is issued. And in that offer letter, it’s going to contain salary, start date, who the employee will be reporting to and other policies and procedures, which may later on, if a company grows and expands their workforce, be contained in an employee handbook, but at a startup company or a company that’s only employing a few folks it could be worked into an offer letter where you set forth vacation time, you set forth the expectations and policies and procedures, which may be supplemented by a memorandum as well.
