South African entrepreneurs want to help create jobs. The SME Landscape Report An Assessment of South Africa’s SME Landscape:Challenges, Opportunities, Risks & Next Steps’ 2018/2019 revealed that one of the reasons entrepreneurs launch businesses is to make a difference, including creating jobs.
Hiring employees does, however, come with responsibilities, this is in addition to employee rights outlined in the Basic Conditions of Employment Act.
Alex Hadfield, SME Sector Lead at Harambee Youth Employment Accelerator, answers human resources FAQs about the first hire, from when you should bring in external help, to what you’re expected to pay your employees.
When should a SME owner start thinking of their first hire?
If your business can afford an additional salary, you have specific tasks to hand over and if freeing up some of your time will generate more sales, then you’re on track and ready to make your first hire.
In terms of HR and payroll, what is the difference between interns and entry level employees?
An internship can be formal and informal. Formal internships are structured and practical programmes which have specific outcomes, can contribute towards candidates completing qualifications. TVET qualifications for example, require workplace experience and the completion of a logbook.
Informal internships allows candidates to gain workplace experience through volunteering for a set period, which assists them to build their CV and increase their chances of becoming employable.
Some internships have formalised stipend guidelines which stipulate that candidates must be paid a stipend. In these cases, the SME would need to pay the stipend unless the SME is a host employer, in which case the stipend would be provided for through a specific programme or SETA.
All full-time employees should receive contracts and remuneration in line with the Basic Conditions of Employment Act.
It is very important to be clear about what is expected and what both parties can gain from the opportunity. Considering some remuneration to cover transport and basic expenses is recommended.
The first rule of employing staff must be to ensure that you can afford them, especially in terms of cash flow
What are some of the ways that SMEs can attract potential employees?
In a small business everyone does everything! This means that SMEs offer employees broader experience that they may not get in a large, traditional company. Because of the flat hierarchy in small businesses, employees can grow quickly within the ranks. A small environment also offers a great team environment.
SMEs can’t always afford permanent or full-time employees, however, they may be able to offer workplace experience opportunities that can provide a foundation for an unemployed candidate to improve their CV and increase their chances of finding a sustainable working opportunity.
Harambee Youth Employment Accelerator helps SME employers find entry-level staff and they recognise the recruitment challenges small companies face and provide a great deal of guidance, including a free HR Toolkit.
What kind of traits should employers be looking for in a good hire?
Employers should look for people who have a willingness to learn, are curious, have a get-up-and-go attitude and are comfortable receiving feedback.
It is important to do some planning before you hire so that you are clear about what you want to delegate to a first-time work seeker.
How can employers, in turn, make sure they offer a good workplace?
We believe there are 5 key responsibilities that the employer should consider.
The first rule of employing staff must be to ensure that you can afford them, especially in terms of cash flow.
You need to be very clear about what you want a new employee to do. No one can meet your expectations if they (and you!) don’t know what is expected of them. Before an employee starts make a work space and necessary equipment available for them to perform the tasks required.
We know that SMEs and entrepreneurs often work long hours – it goes with the territory. However, expecting staff to do the same, often without compensation, is unacceptable. For employees who earn below a certain threshold, all overtime is voluntary and may only be worked by mutual agreement.
4. Setting an example
As an employer of entry-level staff, the extent of your influence is enormous. Whether you like it or not, you are their mentor. Put the effort into developing a stable, loyal, rewarding staff member. After all, it is the people who make a business. In addition, any touchpoint you have with a potential employee has the potential to grow your brand.
Set a little time aside each day to give feedback to employees on what the employee is doing well and what they can improve on. We have found that this is one of the key factors that contribute to retention, building trust and a positive work experience if it is done well.