The Cost of Employing Staff
As a small business owner, the decision to hire (or fire) a member of staff is one of the biggest you will make. Get it wrong and it can be hugely detrimental to your business, get it right and it can be hugely beneficial. You might think it’s quite a straightforward decision to make – especially when thinking about the costs involved – unfortunately it is not. For instance, that staff member who you are paying £15k a year, is actually costing you more like £28k after you bear in mind the National Insurance you are paying on top, the time they take off sick, making coffee, surfing the internet or checking Facebook. Ofcourse we are not including the physical cost of recruitment fees you may also incur. Then, there is the additional administrative paperwork that must be completed and is wholly unrelated to their job role. Often it’s this type of activity that is overlooked until after the hire is made and therefore too late – a mistake which too many small business owners make. Examples include; – Writing, issuing & double checking new employment contracts – Managing downtime caused by sickness and other unexpected absences – Processing holiday requests and forecasting the effects on staff workload because of it – Real time PAYE notifications for HMRC What you need to ask yourself is whether taking on a new staff member is really essential to your business. In most cases, you could outsource their responsibilities to a Virtual Assistant Service like ours. Most of the time it is cheaper, all the time it is a lot less hassle. Until next time Mike.