Should You Onboard New Employees Now or Wait Until 2020?
While there are less than two dozen days left in December, you may need new employees to start NOW. However, hiring sooner rather than later may not be the best strategy.
According to PBO Advisory Group’s Consulting CFO Scott Palka, “Adding employees at the end of the year is something that needs to be carefully considered, as compared to adding on the first business day of January 2020.”
According to Scott, here are the factors you should consider that may contribute to hiring in the new year:
- State and federal unemployment is on a calendar-year basis, so adding employees late in the year can add to your unemployment tax bill in 2019.
- Typically, there are quite a few paid holidays during this end-of-the-year period, so you may be paying new employees for more time than they actually have worked and reflective of the value they have provided.
- Providing training can be difficult with many staff members taking time off.
- A January start date could adversely affect benefit start dates for the employee.
- “End of year” headcounts can also drive cost considerations for your 401K plan, small vs. large employer determination, and several other factors.
There are also issues to consider for not delaying new hires:
- We are currently in a hot job market so a potential employee may be here today but gone tomorrow.
- How will the bottom line be impacted by these new hires? If they will be critical to your business, it may be better to bring them on board now to gain their full impact sooner.
This time of year, determining when to hire is a balancing act. We encourage you to consider the above factors regarding potential deferral of onboarding dates.
PBO Advisory Group is available to help you by providing additional guidance and insight on this and other issues. Feel free to contact us today at (858) 622-1681.