What should businesses do before hiring their first employee?

Preparing to Hire Your First Employee in New York

Before hiring your first employee in New York, there are several operational steps to ensure compliance and smooth onboarding.

Register Your Business for Employment

• Obtain an Employer Identification Number (EIN): Secure an EIN from the IRS for tax reporting and payroll purposes.
• Register with the New York Department of Labor (NY DOL): Set up your employer account to manage unemployment insurance and wage reporting.

Understand New York Employment Laws

• Employee Classification: Determine if the worker is an employee or independent contractor to ensure proper tax and benefit treatment.
• Minimum Wage and Overtime: Comply with New York’s wage laws, including the state minimum wage and overtime rules.
• Anti-Discrimination Compliance: Prepare to follow New York State Human Rights Law during hiring and employment.

Set Up Payroll and Tax Withholding

• Register for New York State withholding tax: This is necessary to withhold state income taxes from employee wages.
• Implement payroll systems: Choose payroll software or services that can handle federal and state tax filings, wage payments, and recordkeeping.

Prepare Required Documentation

• Form I-9: Verify employee eligibility to work in the U.S.
• New Hire Reporting: Report new employees to the New York State Directory of New Hires within required timelines.
• Employee Handbook and Policies: Develop clear workplace policies covering attendance, harassment prevention, and safety.

Arrange for Insurance and Benefits

• Workers’ Compensation Insurance: Obtain coverage as mandated by New York law before employees begin work.
• Disability Benefits: Register for the New York State Disability Benefits Law (DBL) insurance.

Plan for Recordkeeping and Compliance

• Maintain accurate employment records: Keep documentation related to hiring, payroll, and workplace safety.
• Stay updated on reporting requirements: Monitor changes in New York employment regulations to remain compliant.