Never hire someone you can’t fire, and other lessons in expansion

My number one rule for hiring an employee: Never hire someone you can’t fire.

In the last 24 hours I’ve had conversations with two members of my small-business group who have had employees and are trying to hire people to drive their equipment again. Their own and others’ motivations make sense. Take the new owner who buys that first truck, is fortunate and lucky enough to be in the right place at the right time to have a year and a half of income well above their expectations. Naturally, they think, Hey, lets buy another truck and hire a driver.

It looks great on paper: Add a truck or trucks, grow a small fleet business. Double, triple or more your income. Spend more time enjoying personal home life following dreams. [Insert here the sound of tires screeching with brake lockup.]

What happened, what went wrong, why isn’t this working?

I’ve been there, and the lessons I learned were expensive and stressful. As Overdrive’s Small Fleet Champ finalists also stressed last month, often enough that employee won’t work as hard or be as dedicated to the vision you’ve got. Productivity will be less than anticipated, and the most efficient workforce is one person, one task. (Conjure here the old joke about the highway construction crews with 10 people watching one who appears to be working.)

A truck owner and friend who has an employee driver shared that he has had to take back dispatching responsibilities for that driver’s equipment. It’s common with small owners that the employee may be given self-dispatch opportunity at first – then, their efficiency and willingness to operate at the higher level begins to fade as they earn enough to become comfortable. Typically, prospects and results fade fairly quickly themselves.

In my friend’s case, his clawback of responsibility saw both the driver’s and his own income increase again, but the driver is now grumbling about the amount of work expected.

As those champs illustrate, it’s not impossible to have employees, but be aware of the cost in both money and time spent managing, not to mention risk. Before you hire someone, learn and understand your responsibilities as an employer.

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It is not legal to hire someone as an employee and then pay that person as an independent contractor. This could be one of the biggest misunderstandings and mistakes new owners make.

Know how payroll taxes are calculated and the amount for your contribution. Also: the cost of unemployment insurance and worker’s compensation; the optional cost of employee benefits, something you may be overlooking in order to attract a competent driver (Champ finalists emphasized those benefits as key in recruiting and retaining the best).

One of my group’s members told me about how he tried to hire and then had six different drivers for one truck in less than a year. Then there’s the day you drive to the employee’s house because they no-call/no-show; you call the sheriff because you’re afraid something bad has happened. Turns out, they just didn’t come to work. Guess they didn’t feel like it that day.

We can try and pound the square peg into a round hole but there’s going to be a lot of damage to the peg, the hole or both before you’re finished. My bottom-line advice: if you’re trying to hire and do find a good person, say a prayer of thanks and take good care of that person.

The Champ finalists and the winner of that honor all stressed the need to take exceptional care of the good ones. It’s well worth listening to their comments from the virtual session. You can view the original webcast below.