Managing the Paperwork of New Hires

Posted by James R. Schrier, on February 6, 2014

Most employers present a new hire with a pile of government forms on the first day of employment. The first day is also an optimal time to obtain consents and agreements with new employees. The following checklist of new hire procedures – both required and optional – will assist Indiana employers in the processing of new hires.

  1. Complete the I-9 Employment Eligibility Verification form. The I-9 must be completed by each new hire in order to document that they are authorized to work in the United States. New employees must also present proof of eligibility, such as a birth certificate or “green card.” Employers can sign up for the E-Verify system to confirm the eligibility of new employees.
  2. Obtain Form W-4 for Federal Income Tax Withholding. The W-4 form must be completed before a new employee receives his or her first paycheck. Employers should not advise employees how to complete this form, but they may refer employees to IRS resources for assistance.
  3. Obtain Form WH-4 for Employee’s Withholding Exemption & County Status. The WH-4  is the Indiana equivalent for obtaining payroll and residency information relating to state income taxes.
  4.  Report the new hire. All Indiana employers must report their new hires to a state directory within 20 days of their hire date. Information on new hires is collected pursuant to federal law in order to facilitate enforcement of child support orders nationwide. Electronic reporting is available. Penalties ranging from $25 to $500 may be imposed on an employer who fails to properly report the required information.
  5.  Have employees sign a consent to perform a background check, if not already obtained during the hiring process. Such consent allows employers to legally obtain information on an employee if the need arises during employment. Prior notice of and consent to perform a background check are required under the Fair Credit Reporting Act if the check is done by an outside, for-profit service.
  6.  Have new hires complete a job application form, if one is not already on file. The form collects information about new employee that can be verified, such as previous employers and education. It should include a statement attesting that information on the application is true and correct.
  7.  Have the employee acknowledge receipt of the employer’s policy handbook. In the event of an employment dispute, it may be important to show that the employee received written notice of the employer’s policies. Litigation may arise from disputes involving employee discipline, benefits, confidentiality, surveillance and privacy issues, and employment at will – all of which may be addressed in a policy handbook.
  8.  Obtain the employee’s acknowledgement of a computer usage policy statement. The prevalence of electronic information and social media necessitates a specific policy requiring that employees use an employer’s network and internet resources for business purposes only. The policy protects the employer from the risk of viruses/malware/spyware, prevents employees from monopolizing bandwidth, and promotes employee productivity.
  9.  If appropriate, obtain the employee’s agreement not to compete. An enforceable non-competition agreement requires adequate consideration. For a new employee, consideration can be the job itself. Agreements signed at the very beginning of an employment relationship may therefore provide for sufficient consideration, whereas additional consideration would be required for agreements signed after the new-hire period.

Consult with an attorney experienced in employment practices to discuss which new hire procedures apply to your business.

**Reiling Teder & Schrier, LLC is an Indiana Limited Liability Company. The information contained in this website has been prepared by Reiling Teder & Schrier, LLC for informational purposes only, and is not legal advice. The information on this website should not be relied upon to make any decision, legal or otherwise. If you have any specific questions or inquiries regarding any of the information contained in this website, you should consult with an attorney licensed in your state. The information contained in this website pertains only to matters of Indiana law and the laws of other states may be completely different from the laws of the State of Indiana.