This document provides an overview and agenda for a seminar on hiring your first employee that covers taxes, payroll, legal compliance and recordkeeping. It begins with introductions and outlines that the seminar will cover registration forms, hiring, taxes/payroll, and resources. Part 1 discusses who to hire, contractor vs. employee, tips for effective hiring, and the interview/reference process. Part 2 reviews tax/payroll compliance steps including obtaining an EIN, setting up withholding, eligibility verification, new hire reporting, workers' compensation, required postings and ongoing recordkeeping.

1. Help Wanted:
Hiring Your 1st Employee
Hiring, taxes, payroll, legal compliance & recordkeeping
Presented by:
Bronwen Madden, Coordinator, SBTDC hosted by MSU-WP
Deanna McNew, Area Manager, Penmac Staffing
Thursday, October 23, 2014 - 1:30 PM to 4:30 PM (CDT)

2. Housekeeping
• Mobile devices
• Restrooms
• Break
• Respect
• Interactive process

3. Sponsors
Penmac Staffing
http://www.penmac.com
Ozarks Small Business Incubator (OzSBI)
http://ozsbi.com
Small Business & Technology Development Center (SBTDC)
Hosted by Missouri State University – West Plains (MSU-WP)
http://wp.missouristate.edu/ucp/SmallBusiness.htm
U.S. Small Business Administration (SBA)
http://www.sba.gov

4. Introductions
• Participants
• Name
• Company
• Position
• Desired Outcome
• Presenters
• Bronwen Madden, Coordinator, SBTDC hosted by MSU-WP
• Deanna McNew, Area Manager, Penmac Staffing

5. Seminar Outline
• Registration Form
• Seminar Agenda
• Hiring
• Taxes, Payroll, and Legal compliance
• Q & A
• Resources
• Handouts
• Evaluation

6. Part 1: Hiring

7. Who Are You Hiring?
• Employees
• Independent contractors
• Statutory employees
• Non-statutory employees
http://missouribusiness.net/article/doing-business-in-missouri-hiring-employees/#tips

8. Contractor Vs. Employee
http://www.sba.gov/content/hire-contractor-or-employee
An Independent Contractor An Employee
Operates under a business name Performs duties dictated or controlled by others
Has his/her own employees Is given training for work to be done
Maintains a separate business checking account Works for only one employer
Advertises his/her business' services
Invoices for work completed
Has more than one client
Has own tools and sets own hours
Keeps business records

9. Ten Tips to Hiring Effectively
1. Define the Job: duties, responsibilities, skillsets, and outcomes
2. Plan Your Employee Recruiting Strategy
3. Use a Checklist for Hiring New Employees
4. Recruit the Right Candidates When Hiring an Employee
5. Review Credentials and Applications Carefully
6. Prescreen Your Candidates
7. Ask the Right Job Interview Questions
8. Check Backgrounds and References
9. Consider Candidates that Complement your Team’s Existing Strengths
10. Use Effective Employment Letters

10. Expanding the Employee Pool
• Advertise in a variety of media (web, print, radio, job fairs, college recruitment, etc.)
• Register with the Missouri Career Center http://jobs.mo.gov to find matches
• Connect with professional and academic associations for potential candidates
Example: Many industry associations will have private job board for members only
• Request names of potential candidates from within local education institutions
Example: Recruit from the Honors College or school’s Student Success Center
• Include statements on your business’ commitment to diversity and provide diversity
training to current employees
Example: Missouri State University is an Equal Opportunity/Affirmative
Action/Minority/Female/Veterans/Disability Employer and Institution.
• Work with staffing agencies and consider employees who have held part-time
positions
• Establish an employee referral program

11. The Interview Process
• The Invitation: Provide information on the interview location, who will be involved, and
your process; use caution if leaving a message to not jeopardize current employment
and maintain confidentiality
• Prepare: Develop a standard set of interview questions to be asked of all applicants;
focus questions on required qualifications
• During the Interview: Ask about abilities, not disabilities
• Introduce everyone to the applicant and offer water
• Keep your poker-face and speak in a normal tone
• Look directly at the applicant and try to be at eye-level; be aware of cultural bias
• If the applicant misunderstands a question, ask the question in a different way
• Close the interview by thanking the applicant and describe your process and timeline
• Afterwards: Notify applicants of the outcome, even those who are not offered the job

12. Interview Questions
DO ASK ABOUT: DO NOT ASK ABOUT:
Tell me about yourself Race
Describe a time when something went wrong at work
and how you dealt with it.
Color
Sex
How would your boss describe you? Religion
What role do you usually play in a team? National origin
Where do you see yourself in five years? Birthplace
Tell me about a favorite project you worked on and
why it’s your favorite.
Age
Disability
Do you have any questions for me? Marital/family status
http://www.eeoc.gov/laws/types

13. Reference Checks
• Always check references (more than one), especially from former supervisors
• Advise the applicant as a courtesy
• Develop a set of reference questions and use for each candidate
• Identify yourself and your reason for calling
• Ask job-related questions
• Find out what kind of work relationship the reference had with the applicant (first hand
observation of performance is most valuable)
• Refrain from asking illegal questions (same as from the interview)
• Can ask about attendance, but not ask about use of sick leave, medical leave, or worker’s
compensation
• Live Scan Fingerprint Screening from the Department of Justice (more common for in-
home supportive care businesses, education institutions and youth organizations)

14. Screening & Evaluating Applicants
• Communicate to the Search Committee what qualifications are deemed most important
• Prioritize qualifications to assist in decision-making
• Decide what qualifications can be evaluated from the application materials
• Narrow your pool of applicants to those best qualified:
• Brief phone interviews
• Pre-interview reference checks
• Supplemental application
• Work sample request
• Resolve differences of opinion regarding a candidate’s qualifications through discussion
• Retain all applications and screening documentation until the process is completed
• Notify applicants who are no longer under consideration
• Consider applicants that have the National Career Readiness Certificate (WorkKeys)

15. Workforce Training Assistance
• On-the-Job Training (OJT)
Training provided at a worksite by an employer; trainee is an employee of the
participating business and trainees receive wages and/or benefits while learning a
new skill.
• Work Ready Missouri Program
Individuals receiving Unemployment Insurance
(UI) Compensation receive occupational
worksite training on a part-time basis for up
to six weeks.
Local Contact:
Steve McCann, Business Services
Missouri Career Center – West Plains, MO
Phone: (417) 256-3158
Cell: (417) 293-8653
Email: smccann@scwib.org

16. Break:
Back in 15 Minutes

17. Part 2: Taxes, Payroll
and Legal Compliance

18. Hiring Steps Overview
Step 1. Obtain an Employer Identification Number (EIN)
Step 2. Set up Records for Withholding Taxes
Step 3. Employee Eligibility Verification
Step 4. Register with Your State's New Hire Reporting
Step 5. Obtain Workers' Compensation Insurance
Step 6. Post Required Notices
Step 7. File Your Taxes
Step 8. Get Organized and Keep Informed

19. Step 1. Obtain an Employer Identification
Number (EIN)
• Before hiring your first employee, you need to get an employment identification
number (EIN) from the U.S. Internal Revenue Service
• The EIN is often referred to as an Employer Tax ID or as Form SS-4
• The EIN is necessary for reporting taxes and other documents to the IRS
• The EIN is necessary when reporting information about your employees to state
agencies
• Apply for EIN online or contact the IRS at 1-800-829-4933

20. Step 2. Set up Records for Withholding Taxes
• Keep records of employment taxes for at least four years
• Send Copy A of W-2 form to the Social Security Administration by the last day of February
to report wages and taxes of your employees for the previous calendar year
• Send copies of W-2 forms to your employees by Jan. 31 of the year following the reporting
period
• Types of withholding taxes you need for your business:
• Federal Income Tax Withholding
• Federal Wage and Tax Statement
• State Taxes
Obtain a Missouri Withholding Number from the Department of Revenue.
• Obtain Missouri Unemployment Tax from the Department of Labor and Industrial Relations.
• If you already have a Missouri Tax Identification (ID) Number, you can add withholding tax to
your existing number by contacting the Department of Revenue

21. Tax Forms
Federal
Internal Revenue Service Forms: http://www.irs.gov/Forms-&-Pubs
Form SS-4 IRS Employment Identification Number
Form W-4 Federal Employment Tax Withholding
Form I-9 Federal Employment Eligibility Verification
State
Missouri Department of Revenue Forms: http://dor.mo.gov/forms
Form W-4 Employee’s Withholding Allowance Certificate
Form 2643 Missouri Withholding Number
Form 2699 Unemployment Tax Registration

22. Step 3. Employee Eligibility Verification
Verify an employee's eligibility to work in the United States
• Complete Form I-9, federal employment eligibility verification
• Employers are required to keep the I-9 on file for three years after the date of hire
or one year after the date of the employee's termination, whichever is later
• Employers can use information taken from the Form I-9 to electronically verify the
employment eligibility of newly hired employees by registering with E-Verify
(http://www.uscis.gov/e-verify)

23. Step 4. Register with Your State's New Hire
Reporting
• Report newly hired and re-hired employees to a state directory within 20 days of
their hire or rehire date
• Missouri Department of Social Services: http://dss.mo.gov/cse/newhire.htm
You may use one of the following reporting methods:
1. Mail the W-4 or equivalent form to:
Missouri Department of Revenue, PO Box 3340, Jefferson City, MO 65105-3340
2. Fax copies of the W-4 or equivalent form to: (573) 526-8079
3. Electronically report employees via Secure File Transfer. If you are interested in reporting
employees via Secure File Transfer, please contact Child Support at 1-888-663-6751

24. Upon First Payroll, Employers Must:
• Withhold state income tax and federal income tax at a percentage determined
by salary and exemption information stated on the form W-4
• Withhold 6.2% of the employee's salary for Social Security taxes
• Withhold 1.45% of the employee's salary for Medicare taxes
• Pay the Social Security and Medicare taxes to an approved banking institution
on the 15th of the month
• File required payroll reports with the Department of Revenue and
the Department of Labor and Industrial Relations on a quarterly and annual
basis; and issue W-2 reports to employees at the end of the year

25. Step 5. Obtain Workers' Compensation
Insurance
Carry workers' compensation insurance coverage through a commercial carrier, on a
self-insured basis or through their state’s Workers' Compensation Insurance program.
Ryan McKenna, Director, Labor and Industrial Relations
Commission
John J. Hickey, Director, Workers’ Compensation
3315 W. Truman Boulevard, Room 131, P.O. Box 58
Jefferson City, MO 65102
(573) 751-4231 | Fax: (573) 751-2013
workerscomp@labor.mo.gov
http://labor.mo.gov/contact-labor

26. Missouri Workers' Comp. Ins. Requirements
• Required to carry workers’ compensation insurance if you have five or more employees,
unless you are in the construction industry, then you must carry workers’ compensation
insurance if you have one or more employees
• Employers that don’t have the required number of employees or who have employees in
the exempt categories may “elect” to come under the law and carry workers’ compensation
insurance
• Exempt employers that decide not to purchase workers compensation insurance or to self-
insure remain exposed to civil lawsuits brought by employees who are injured during work
• Sole proprietors and partners are not themselves covered unless they elect to be covered;
close family member-employees and members of a limited liability company are presumed
to be covered unless they opt out
http://labor.mo.gov/DWC/Employers

27. Step 6. Post Required Notices
Display posters in the workplace that inform employees of their rights and employer
responsibilities under labor laws
http://labor.mo.gov/content/mandatory-posters
Posters Required by the State of Missouri
1. Notice to Workers Concerning Unemployment
Benefits (MODES-B-2)
2. Workers' Compensation Law (WC-106)
3. Discrimination in Employment (MCHR-9)
4. Missouri Minimum Wage Law (LS-52)
5. Employer's Employing Workers Under the Age of 16
List (LS-43)
6. Discrimination in Housing (MCHR-6)
7. Discrimination in Public Accommodations (MCHR-7)
Posters Required by the Federal Government
1. Employee Polygraph Protection Act (WHD 1462)
2. Employee Rights under NLRA
3. Equal Employment Opportunity is the Law (EEOC-P/E-1)
4. Fair Labor Standards Act: Minimum Wage (WHD 1088)
5. Family and Medical Leave Act (WHD 1420)
6. Job Safety and Health: It's the Law Poster (OSHA 3165-
12-06R)
7. Uniformed Services Employment and Reemployment
Rights Act

28. Step 7. File Your Taxes
If applicable, file IRS Form 941, Employer's Quarterly Federal Tax Return
New and existing employers should consult the IRS Employer's Tax Guide to
understand all their federal tax filing requirements.
• Online: http://www.irs.gov/publications/p15
• PDF: http://www.irs.gov/pub/irs-pdf/p15.pdf

29. Step 8. Get Organized and Keep Informed
Maintain a healthy and fair workplace
Provide benefits
Keep employees informed of company policies
Set up recordkeeping
Tax Recordkeeping Guidance
Labor Recordkeeping Requirements
Occupational Safety and Health Act Compliance
Employment Law Guide (employee benefits chapter)
Apply Standards that Protect Employee Rights
Comply with standards for employee rights
Equal Employment Opportunity Commission
Fair Labor Standards Act
Follow statutes and regulations for minimum wage, overtime, and child labor
http://www.dol.gov/compliance/guide

30. Keep Record of Employee Details
• Name and Social Security number
• Dates a worker was hired and separated
• Dates on which a worker performed some services
• The location where services were performed
• The amount of remuneration paid each worker
• The hours of each day in each pay period an individual worked in non-covered
employment, and nature of the work
• Wages, including commissions, bonuses, prizes and gifts. Also, tips received by a
worker from persons other than employer, if such tips are reported to the employer
for Social Security purposes
• Copies of all hiring documents and tax forms (W-4s, I-9, etc.)

31. Occupational Safety & Health
Administration (OSHA)
• Employers must furnish a place of employment free from recognized hazards and comply with
occupational safety and health standards
• Right to file a complaint with OSHA and request an inspection
• Employers or Employee Rep given an opportunity to accompany an OSHA inspector
• Employees must not be discharged or discriminated against for filing safety and health complaints
• Citation alleging violations may be issued to the employer; citations specify a time period within which
the alleged violation must be corrected
• OSHA citations must be prominently displayed at or near the place of alleged violation for three days or
until it is corrected, whichever is later, to warn employees of these dangers
• Free assistance in identifying and correcting hazards and in improving safety and health management is
available to employers, without citation or penalty, through OSHA-approved Missouri Department of
Labor on-site inspections: labor.mo.gov/DLS/WorkplaceSafety/free_onsite_sharp.asp
• Consult the OSHA Small Business Handbook: osha.gov/Publications/smallbusiness/small-business.html

32. Occupational Safety & Health
Administration (OSHA) Contacts
Kansas City Area Office St. Louis Area Office
2300 Main Street, Suite 168 1222 Spruce Street, Room 9.104
Kansas City, Missouri 64108 St. Louis, Missouri 63103
(816) 483-9531 (314) 425-4249
(314) 425-4255 Voice Mail
(816) 483-9724 Fax (314) 425-4289 Fax
Toll Free:1-800-892-2674 Toll Free: 1-800-392-7743

33. The Affordable Care Act
• Notify employees of the Affordable Care Act
• Businesses with over 50 full-time employees (FTEs) are required to offer health
insurance
• Small Business Health Options Program (SHOP) is available for employers with 50 or
less FTEs https://www.healthcare.gov/small-businesses/employers
• May qualify for the small business health care tax credit with less than 25 FTEs
• Insurance providers cannot turn you down due to health status or pre-existing
conditions
• Open enrollment for 2015 starts on November 15
QUESTIONS? Call 1-800-706-7893 (TTY: 711) Monday-Friday 9 a.m. – 7 p.m. ET

34. Questions & Answers

35. Hiring Resources
U.S. Department of the Treasury, Internal Revenue Service (Circular E), Employer's Tax Guide
http://www.irs.gov/pub/irs-pdf/p15.pdf
U.S. Small Business Administration, Hire Your First Employee
http://www.sba.gov/content/hire-your-first-employee
U.S. Department of Labor (DOL) Compliance:
http://www.dol.gov/compliance
Missouri Department of Labor Resource Guide for Employers
http://labor.mo.gov/sites/default/files/pubs_forms/4466-AI.pdf
Missouri Business Portal
http://www.business.mo.gov/hire.asp
Doing Business in Missouri: Hiring Employees
http://missouribusiness.net/article/doing-business-in-missouri-hiring-employees