Hiring Your First Employee: A Step-by-Step Guide for New Business Owners

Hiring your first employee is a big milestone and an exciting step in growing your business. But if you’re not sure how to hire your first employee, don’t worry. This first-time employer guide will walk you through each step in a clear, simple way. From writing a job posting to setting up payroll, here’s everything you need to know to make the process smooth and compliant.

Define the role clearly

Before you post the job, take time to think about what you need.

• What tasks take up most of your time?
• Which responsibilities could someone else handle?
• Will this role be full-time, part-time, or temporary?

Write down the key duties, qualifications, and any certifications required. The more specific you are, the easier it will be to find the right candidate.

Write a clear job posting

A good job posting sets the tone for the kind of employee you want to attract. Keep the language simple and straightforward.

Include:

• Job title and employment type (e.g., full-time, part-time)
• Compensation range
• Main responsibilities of the role
• Basic qualifications and skills required
• Work location or remote details, if applicable
• Instructions on how to apply and the deadline

You can also add a short line about your workplace culture or what makes your business a great place to work.

Choose the right job boards

Posting your job in the right places is just as important as writing a good ad. Use reputable job boards that fit your industry and location. Don’t forget to share the job on your company website and social media channels and ask your professional network to spread the word.

A targeted approach usually works better than posting everywhere at once.

Screen and interview candidates

Once applications come in, review resumes carefully and shortlist candidates who meet your main criteria. Prepare structured interview questions ahead of time to keep the process fair and consistent. When interviewing, focus on:

• Experience and skills relevant to the job
• Problem-solving abilities
• Cultural fit for your team, meaning whether the candidate’s values, communication style, and work approach align with how your business operates
• Ensure you have all your interview notes documented

For small businesses, cultural fit doesn’t mean hiring people who all think alike. It’s about finding someone who shares your core values (like teamwork or accountability) and can thrive in your work environment. This is especially important when you’re hiring your first employee, because they’ll play a big role in shaping your workplace culture.

For efficiency, you can start with a short phone or video call before scheduling a more structured interview.

Make the job offer

When you’ve found the right candidate, make a verbal offer first to confirm their interest. Then follow up with a written offer letter that includes:

• Job title and responsibilities
• Start date
• Compensation and benefits
• Work hours and reporting structure
• Any conditions, such as reference checks

This step makes everything clear and sets professional expectations from the start.

Set up your payroll system

Before your new hire’s first day, you’ll need to have a payroll system in place.

• Register for a Business Number (BN) and set up a Canada Revenue Agency payroll account.
• Decide whether you’ll manage payroll internally or use a provider.
• Understand your responsibilities for income tax, CPP, and EI deductions.
• Getting payroll right from day one will save you time and prevent compliance issues down the road.

Take care of legal and onboarding basics

A few final steps will make your new hire’s start much smoother:

• Draft a clear employment contract that follows provincial employment standards (e.g., minimum wage, hours of work, vacation).
• Collect required documents such as their SIN and tax forms.
• Create a simple onboarding plan: Workplace tour, introductions, role expectations, and any initial training.
• This is also a good time to introduce them to your basic workplace policies, like health and safety, harassment, and social media guidelines.

Build a strong foundation as an employer

Your first hire will set the tone for your workplace culture. Communicate clearly, set expectations early, and make them feel welcomed and supported. Investing a bit of time upfront will help you build a team that grows with your business.

Need HR support for your new business?

Hiring your first employee doesn’t have to be complicated. With a clear plan and the right steps, you can find someone who will make a real difference in your business.

If you need support with contracts, policies, or compliance, Peninsula’s experts can guide you through every stage of the hiring process.