You’ve been doing everything yourself. The admin, the client work, the invoicing, the coffee runs. And lately, you’ve noticed something: there simply aren’t enough hours in the day.
So the thought crosses your mind—maybe it’s time to hire someone.
But hiring your first employee is a big deal. It’s exciting, yes, but it also comes with real financial commitments and responsibilities. Get the timing right, and it can be the best decision you ever make for your business. Get it wrong, and you might find yourself in a cash flow pickle.
Let’s break down how to know when you’re actually ready.
Signs You Might Be Ready to Hire
Before we talk numbers, let’s look at some of the telltale signs that your business might be crying out for help.
You’re Turning Down Work
If you’re saying no to new clients or projects because you simply don’t have the capacity, that’s lost revenue walking out the door. An extra pair of hands could help you capture that growth.
You’re Stuck in the Weeds
Are you spending your days on tasks that don’t actually need your expertise? If you’re a tradie quoting jobs but also doing all your own bookkeeping and scheduling, you might be better off delegating so you can focus on the money-making work.
Quality Is Starting to Slip
When you’re stretched too thin, things fall through the cracks. If you’re noticing more mistakes, slower turnaround times, or unhappy customers, it might be a sign that you need support.
You Haven’t Had a Proper Break in Months
Burnout is real. And it’s not sustainable. If taking a single day off feels impossible, that’s your business telling you something needs to change.
The Financial Side of Hiring
Okay, so you’re feeling the squeeze. But can you actually afford to bring someone on? Here’s what you need to think through.
It’s Not Just the Salary
When you hire an employee in Australia, you’re not just paying their wage. You also need to factor in:
- Superannuation (currently 11.5% on top of wages)
- WorkCover insurance
- Payroll tax (if applicable in your state)
- Leave entitlements—annual leave, sick leave, public holidays
- Equipment, training, and onboarding costs
As a rough guide, the true cost of an employee is often 20-30% more than their base salary. Make sure you’re budgeting for the full picture.
Can Your Cash Flow Handle It?
Employees need to be paid regularly, whether your clients pay you on time or not. Before hiring, take a hard look at your cash flow. Do you have enough consistent income to cover wages every fortnight or month? Do you have a buffer for quieter periods?
If your income is lumpy or unpredictable, you might need to build up a cash reserve first, or consider starting with a contractor or part-time role.
Will This Person Generate Revenue?
Sometimes hiring is about freeing up your time so you can earn more. Other times, the new hire will directly bring in revenue—like a sales rep or another service provider.
Either way, think about the return on investment. If hiring someone at $60,000 a year allows you to take on an extra $150,000 in projects, that’s a pretty solid business case.
Alternatives to a Full-Time Employee
Not quite ready for a permanent hire? You’ve got options.
Contractors and Freelancers
Contractors can be a great way to get help without the long-term commitment. You pay for specific work, and you don’t have to worry about super, leave, or payroll tax. Just make sure you’re classifying them correctly—the ATO keeps a close eye on sham contracting.
Part-Time or Casual Staff
A part-time employee gives you flexibility while still building your team. Casual staff can be handy for busy periods, though keep in mind they’re entitled to a casual loading in lieu of leave entitlements.
Outsourcing
Some tasks—like bookkeeping, marketing, or IT support—can be outsourced to specialists. This way, you get expert help without adding to your headcount.
Getting Your Books in Order First
Before you hire anyone, make sure your financial foundations are solid. You’ll need to:
- Set up payroll properly (Single Touch Payroll is mandatory in Australia)
- Understand your tax and super obligations
- Have clear records of your income and expenses
- Know your numbers—profit margins, cash flow, break-even point
If any of that sounds overwhelming, that’s exactly where a good accountant comes in handy.
Ready to Take the Next Step?
Hiring your first employee is a milestone moment. It means your business is growing, and that’s worth celebrating. But it’s also a decision that deserves careful thought and solid financial planning.
If you’re wondering whether you’re ready to hire—or you need help getting your books sorted before you do—the team at Empire Accounting & Finance is here to help.
Book a chat with us today and let’s make sure your next big move is a smart one.
