Hiring Employees

Q: "Posting listings on eBay is very time consuming. I would like to hire an employee to help me with that so I can focus on the more fun aspects of the business, like finding good inventory. When should I consider hiring my first employee?"

A: Like any business decision, when hiring your first employee you should weigh the costs against the benefits. Hiring this person will free up your time so you can spend it doing more important things to build the business—sourcing the right products, optimizing your eBay Store for search engines, writing a weekly e-mail newsletter to your customers, and so forth.

But... will all that activity generate enough revenue to cover the additional costs (wages, benefits, equipment, overhead) that new employee will generate?

Here's a rule of thumb: An employee's average cost is generally two to three times the person's base salary (before you withhold taxes). If the employee's base salary is $30,000 a year pretax, you have to generate $60,000 to $90,000 in additional revenue to cover those costs. Is that feasible, based on your past experience with this type of merchandise? If you are selling bobble-head dolls on eBay for $10 each, you will have to sell lots and lots and lots more bobble-head dolls to reach those numbers.

Q: "How do I avoid discriminating when interviewing candidates for a job?"

A: When hiring employees, you cannot discriminate on the basis of race, religion, sex, age, marital status, pregnancy, or national origin. In many states, you also cannot discriminate on the basis of sexual orientation.

When interviewing candidates for a job, you should be concerned only with that person's qualifications for the job. Avoid saying anything that signals that you are focusing on something other than the person's qualifications—even if your intentions are good, because we all know "the road to hell is paved with good intentions." Here are some questions that are guaranteed to get you into legal trouble:

• "Abdul, that's a beautiful turban you're wearing; you know, I've always wondered—how long does it take to wind that around your head in the morning?"

• "Congratulations, Mary, I can see your new baby is due any minute. Let me ask, how long a maternity leave do you think you'll need when the baby arrives?"

• "Luther, you're a perfect fit for this job, but you probably know we deal in a lot of Black Americana antiques. Since you're obviously African American, how will you feel about listing those items on eBay?"

• "I think it's just horrible that you lost both your arms during the Iraq war. I'm assuming you were honorably discharged, by the way. What was it like when you woke up in the field hospital the next day?"

• "I see your fiance/husband is working for Company X here in town. You probably know they're planning to shut down their offices and move out of state pretty soon. How will that affect your ability to devote your full time and attention to this job?"

Talk to an attorney if you sense there are sensitive issues that may come to the surface when interviewing a particular candidate—common sense should be your guide here.

Q: "I recently posted an advertisement for a delivery truck driver. Several individuals responded to the ad, but when I interviewed them I noticed that one of the applicants—a Gulf War veteran—had a prosthetic arm. I believe strongly in hiring veterans, and I realize they've made many technical advances in prosthetic limbs, but I'm really worried about this individual's ability to do the job. I'm also worried that if I hire one of the other qualified individuals, this guy will sue me for discrimination. What can I do?"

A: The federal Americans with Disabilities Act (ADA) absolutely prohibits discriminating against disabled persons. I congratulate you for knowing that the law applies even to small businesses. If a disabled person thinks you are violating the ADA and making it impossible for disabled or handicapped individuals to find jobs with your firm, he or she can certainly sue for discrimination. Yet clearly there are certain jobs people with certain disabilities will never be able to do. How do you avoid discrimination lawsuits without being forced to hire individuals who cannot perform the jobs they have applied for?

First, make sure you haven't already discriminated against this individual during your initial job interview. Whenever you interview disabled or handicapped individuals for jobs, you have to be careful that you don't inadvertently signal that you're focusing on their disabilities. So, for example, you would be totally out of line (and could well be sued) if you say something to this individual like "Hey, didn't you read my ad? I'm looking for a truck driver. How the heck can you drive a truck with only one arm?" Even though you have a legitimate concern about this individual's ability to do the job, by focusing your attention on the person's disability you make it very likely he will feel he is being discriminated against.

The correct way to deal with this situation is by saying something like this: "As you saw from our ad, one of the essential functions of this position is driving a truck. Are you aware of any circumstances that would restrict or prohibit you from performing that essential function?" I know, I know, it's tough to remember all that, and it does sound a little like legalese, but that's the way the law requires you to ask that question.

The next step is to determine if driving a truck is an "essential function" of the position you've advertised. Let's say you had a position that involved 95 percent clerical work and 5 percent driving a forklift in your warehouse. If a person with a prosthetic limb applies for this position, he or she clearly can perform the clerical functions (the essential part of the job), but his or her ability to drive the forklift is in question. The ADA in this instance would require you to "restructure" the job and eliminate the forklift-driving component as a "reasonable accommodation" of the applicant's disability. Based on your e-mail message, I am assuming that driving a truck is an essential function of the job you've advertised.

You are correct in pointing out that medical science has made tremendous advances in prosthetic limb technology in the past few years. Since this applicant is neither blind nor illiterate and presumably knows that he is applying for a position driving a truck, he obviously thinks his disability won't stand in the way of his being able to do the job. Why not have him prove his ability by performing a short driving test in one of your company's trucks? If you do:

• Be sure to test him under actual conditions. Don't just have him drive around your parking lot; have him carry out an actual delivery so you can see firsthand how he is likely to perform on the job.

• Be sure to "ride shotgun" with him so you can evaluate his performance, and have another individual present during the test so he or she can corroborate your evaluation.

• If you conclude that the applicant isn't qualified for the position, take detailed notes during the test documenting specific tasks he is unable to perform, and keep those notes in your employment records in the event he does sue you.

• Most important, be sure you require this test of all applicants, so it doesn't look like you're singling him out because of his disability.

If he flunks the test, consider whether you might have another open position he might qualify for, and if you do, encourage him to apply for that position. Hiring a vet is one of the most noble things any small business can do, and you should go a little out of your way to find room for him in your organization. Not only is this the patriotic thing to do, but I think you'll find, as many of my law clients have, that vets are incredibly loyal, grateful, disciplined, hardworking employees, and they can be a major asset to any small business. This guy did you (and a lot of other people) a big favor once by serving in the armed forces during wartime, and you owe him—big time.