Understanding New Hire Documents
Hiring a new employee is about finding the best person for the right job—but after you’ve picked the perfect hire, a mountain of paperwork stands between you and getting the new employee to work. Productivity comes after you’ve got all the proper new hire documents filled out and in place as part of the onboarding process.
Employee onboarding documents can be a hassle, but making sure each one is signed and filled out correctly and in time for a new employee to start is one of an HR professional’s jobs. In the United States, certain essential documents are needed to legally clear a new employee to receive a paycheck and pay taxes. Other documents aren’t required legally but are important to the onboarding process. To help you make sure you’ve got the right new hire documents, we’ve listed four important categories for employee onboarding documents you should be utilizing.
Types of Onboarding Documents
- Legal forms
- Job-specific documents
- Company-specific documents
- Pay and Benefits
1. Legal Forms
You may have heard of this form, whether or not you know the W-4 form definition off the top of your head. The W-4 form is a tax document required in the United States for all new hires. The IRS uses it to determine how much pay should be withheld for taxes on every paycheck.
The W-4 form is filled out by the new employee and can be downloaded directly from the IRS. It’s best to include this form in your new hire packet or send it to them electronically, rather than directing your employee to the IRS website, for their convenience and to make sure they fill out the correct document. When filling it out, the new hire will answer a series of questions about their filing status, including marital status, additional employment, and number of dependents. All new hires must complete the W-4 form before they can receive their first paycheck.
Employment I-9 Form
The employment I-9 form is an employment eligibility form. It is used to make sure the new hire is currently eligible to work in the United States. As an employer, it is up to you to verify that your hire can legally work based on their citizenship, visa, resident, and immigration status. The I-9 involves two steps:
- The new hire fills out a form declaring their eligibility, and declares which documents can be used to verify their status.
- The new hire submits work eligibility documents, which you as the employer review and determine if they adequately verify work eligibility. The IRS has a list of acceptable documents that can be used for this process, including passports, birth certificates, permanent resident cards, etc.
Once you have verified the new hire’s citizenship, they are free to work. You do not need to submit the employment I-9 form or verifying documents, but you will need to produce them if an immigration officer requests employee documents.
State Withholding Certificate
A State Withholding Certificate is basically a W-4 form for the state. This document determines the amount that will be withheld from the employee’s paycheck for state taxes. Unless you are in one of the nine states that do not have income tax, this form will be necessary for your new hire.
2. Job-Specific Documents
Employment Offer Letter
The employment offer letter is another essential new hire document. It is an official and formal offer of employment. It lists these important details:
- Job title
- Job description
- Start date
- Starting salary
- Direct manager
- Benefits eligibility
- Any contingencies, such as passing a drug test and/or background check
The employee receives the letter and signs it to officially accept the position, acknowledging and agreeing to the details above regarding the position, pay, and benefits.
An employment contract is a written agreement between the employer and the employee about their roles and responsibilities in that position. At this point, the employee will have already accepted the position, but a written agreement ensures that none of the previously mentioned conditions have changed and can be used in the future in case any miscommunication or issues arise.
An employment contract can include any of the following:
- General position responsibilities
- Wage or salary
- Employment duration
- Non-compete or non-disclosure agreements
Being an employee is a two sided relationship between the employee and their manager. Once an employee has a clear vision and understanding of what their roles and responsibilities are, it’s important to lay out what the employee can expect from their managers.
Once an employee has a clear vision and understanding of what their roles and responsibilities are, it’s important to lay out what the employee can expect from their managers.
These expectations can be included in a lot of different documents on the new hire’s first day, so where you have them is not has important as just having them in general. These manager expectations show the employee that upper management is also obligated to uphold their end of the deal and show respect to the employee.
Manager expectations can include:
- Constructive criticism
An instruction manual, also known as a user manual, is a written booklet about the functions of an employee’s tasks. It’s structured in a “how-to” manner and typically has diagrams showing how to complete an activity. Not all jobs require an instruction manual, but they are highly recommended for positions that use any equipment that might not be intuitive.
Key Performance Indicators
Key Performance Indicators (or KPIs) are the quantifiable metrics used to show success towards certain goals in a business. Your new employee will need to know what these indicators are and which ones apply to them so they can measure whether or not the tasks they’re completing are making a positive difference for the company as a whole. Examples of KPIs are Customer Acquisition Cost, ROI, Customer Complaints, Conversion Rates, ROAS, etc.
Schedules or Calendars
Your new hire will need to know when company meetings are, when they’re expected to be in the office or working from home, or when their one-on-one is with their manager. This is also a great time to let your employee know when their 30-day, 60-day, and 90-day reviews will be. This information can be digital (Google Calendar) or physical.
3. Company-Specific Documents
Make sure your employees understand the dress code, policies, company values, code of conduct, etc. at your company by including the employee handbook in their onboarding packet. They will appreciate knowing what to expect on their first day. The rest of the topics from this section can all be added into the employee handbook, but we’ll address each document individually.
Company Mission Statement
The reason why a company exists is laid out in the company mission statement. This is the overall purpose and goal of a standing organization. This statement should include what product or service the company offers, who their target audience is, and what the company is trying to accomplish.
Business or Strategic Plan
A business plan illustrates the mid- to long-term goals your company has for achieving their mission statement. It also lays out the steps the business needs to take in order to achieve those goals. Each individual department within a company can have their own business or strategic plan.
In order for the employee to know who they report to and who reports to them, they will need an organizational chart. The chart will begin with the CEO or Owner at the top and work its way down to the hourly employees in each department. The position of each employee should also be listed underneath their names for clarity. This chart can get complicated or cluttered when there’s more than 50 employees so we recommend only adding the line of authority for their individual department if this is the case.
Risk Management Policy
A risk management policy is a statement the business makes about how they will respond to risks and minimize their impact. This can include anything from internal risks (e.g. accidents, embezzlement, labor shortages, etc.) to external risks (e.g. pandemics, lawsuits, climate change, etc.). This policy should include how the company is planning on identifying potential risks and how they will address the risk if it were to occur.
Corporate Identity Guidelines
This document should cover how the corporate identity or brand is to be established or portrayed within the company as well as to the public. This ensures the company has a consistent voice and image no matter who is representing them. The guidelines should cover items such as:
- Voice and marketing
- Fonts and typography
- Colors and shapes
- Photography and art
The corporate identity guidelines will help your new employee understand how to communicate with other employees and customers in a way that is consistent with the brand the company has already established. This consistency will increase customer loyalty and exemplify professionalism within the corporation.
Emergency Contact Info
New hires should provide the contact information for at least two individuals who you could call if an accident or emergency were to happen. The minimum information you should have for these contacts would be their name, a phone number, and an email address.
Non-Compete or Non-Disclosure Agreement
Another important employee onboarding document is the non-compete or non-disclosure agreement. This document is not required legally in the same way the tax documents and employment verification documents are but is definitely recommended to protect the intellectual property, systems, and processes your company uses to get a competitive edge.
- A non-compete agreement, signed by an employee, is a legally binding contract that requires the employee not to do anything to compete with your company after their employment ends—in other words, that they won’t work with a competitor or start a competing business. This agreement may expire after a specified amount of time.
- A non-disclosure agreement requires the employee to not discuss company policy or any projects in process with people outside of the company.
Both of these documents may vary by company and industry, but every business, including new and growing businesses, has an interest in protecting its processes and projects from the competition. The non-compete and non-disclosure agreements help with that.
Employee Consent Form
If your company requires any consent forms for employees—for a background check, for example—include that for them to sign as well.
4. Pay and Benefits
Direct Deposit Form
If your company offers direct deposit as a way of delivering paychecks, a direct deposit form is an essential new hire document. It collects the bank account number and routing number that can be used to deposit a paycheck in the employee’s bank account. Allowing employees to specify and set up direct deposit right from the onboarding process will ensure everything goes smoothly from their first paycheck.
A benefits brochure is a great way to introduce your total compensation statement and show your new hire which benefit options are available to them. These are especially helpful when certain benefit options require a lengthy explanation such as high deductible health plans, savings accounts or health reimbursements.
Some common items to include in a total compensation statement are:
- Medical benefits
- Paid Leave
- Flexible spending account information
- Life insurance
- Disability insurance
- Tuition reimbursements
- Retirement benefits
- Career-advancement opportunities
Sharing this information with your new employee can also take many forms such as a presentation given by the new hire’s onboarding buddy, a comprehensive video that is included in the new hire’s digital onboarding tasks, or simply a printed document that is given to them on their first day.
If you’re not going to have a full benefits brochure, it’ll still be necessary for you to inform your new hire about the company’s time-off policy. This should be put in writing so there’s no confusion down the line. This document should also explain how the employee is to track their PTO, vacation hours, sick days, jury duty, etc.
Employee onboarding documents are a crucial part of the onboarding process, making sure your new employee gets started off on the right foot, ready to perform well, follow company procedure, and receive their first and subsequent paychecks without a hitch.
Onboarding doesn’t have to be complicated or challenging: Learn how Eddy can help streamline your onboarding process.