A shop owner and longtime friend of mine tells a story that neatly captures the challenges involved in hiring skilled help.

It seems a tradesman had been pestering my friend for some time, seeking a chance to work in his well-regarded shop. If nothing else, the man was persistent, and when the day finally came that the shop needed another skilled woodworker, my friend gave this prospect a call.

"I have an opening for a skilled craftsman," he said on the phone, "and I'd like you to come in for an interview."

Because the prospect was a German immigrant who had in prior conversations (through a thick accent, of course) mentioned his "old-world craftsmanship" and love of the trade, my friend was excited. "This guy," he thought, "could be a perfect addition to my staff." The eager prospect came to the shop that same afternoon. After the usual review of his experience (much of it had taken place overseas, the prospect said), the shop owner made the man an offer. He accepted and reported to work the next day.

It only took a few minutes that morning for my friend to realize he had made a mistake.

When asked to sand a solid table top to prepare it for finishing, the man enthusiastically picked up a belt sander, locked its switch in the "on" position and began sanding the piece with just one hand on the machine. Though my friend rushed over and stopped him immediately, the damage was already done; the sander's rear wheel had ground a deep depression in the expensive top.

My friend smiles today when relating this story. "I guess," he says, "they didn't have belt sanders in the 'Old World!'"

In considering a program to establish and expand employee competencies, you have to start with an evaluation of where the employee is when you hire him. Short of bringing someone into the shop on a provisional basis (the provision being they prove to have the skills required to join the company full-time), how can a business evaluate the talents of prospective employees to make sure the match is a good one for all concerned?

First, let's look a little more closely at the provisional approach. Why not bring folks in on a provisional basis?

The short answer is that many shops do, and it works beautifully for them. But insurance companies are not crazy about the idea, nor are tax officials. The bottom line with both, generally, is that if people are using your equipment and working in your shop under your direction and at times you establish, they are employees. For insurance companies, this means they had better be covered under your liability insurance; for the tax man, it means you had best be withholding taxes and matching their Social Security/Medicare contributions.

Nonetheless, some shop owners roll the dice, if only for a day or two, to see if a prospective employee will be a good fit - before placing him or her on the payroll. In my opinion, these owners foolishly expose themselves and their businesses to nothing short of fiscal, and perhaps criminal, catastrophe.

If the prospect happens to be injured before he is "on the books," he stands to make a lot of money - in court. I'm no lawyer, but I can't see where the business would have a legal leg to stand on in the event of such a claim. And if the injury is severe enough, a charge of criminal negligence does not seem beyond the realm of possibility.

Unfortunately, though, each time a shop "tests" a prospect without incident, that business becomes a little less concerned about such things. And even if a shop is testing people in relatively "safe" skill sets, keeping them away from stationary and even portable power tools, the threat is still there. It takes just one false step, literally, for a potential employee to "stumble" into a windfall, at your expense.

Ironically, smart companies regularly do the same thing - test their prospective hires - but they use a tool called a "probation period" to accomplish it within safe ground.

Usually a 30-, 60- or 90-day term, the probation period is a chance for both the company and the employee to evaluate their relationship during its crucial formative stages. During this period, either party can decide the marriage is not a good one and say "adios." Sure, you have to put the person on the books. But why, given the risks negated by doing so, would any business still opt to take a chance?

So let's say that you are smart and want to develop a program that will address your concerns about hiring and retaining skilled people. There is a strong hint about the right way to approach this in the story of my friend's "Old World" encounter, namely, start people with relatively simple tasks and encourage them to advance based upon their mastery of those tasks. In fact, this can and should be the driving force behind any competency program.

For some shops, this is just common sense. See if a new hire can sand. After a few days or weeks of that, let them try their hand at spray finishing or assembly or cutting. But "departmental skills development" is not an option in all shops, especially smaller ones. In small operations, there is usually an immediate need for employees to demonstrate at least basic competencies in a number of skills, plus the will and ability to learn and apply more demanding talents.

I have often written in this column about training, and while it is certainly the keystone of any shop's competency program, it should not be the first order of business. On the contrary, you want to know what the new employee is capable of before he gets any training from you.

My suggestion is to set up three to five competency ratings. The exact number will depend on the diversity of work your shop produces and what you are asking of each employee. In my own shop, I established five levels, ranging from "Craftsman Trainee" to "Level Four Associate." Each level demanded a certain amount of competency in various tasks.

Next month, I'll provide more detail about what each level required from my employees. For now, let me reiterate the importance of evaluating a prospective employee based on the talents he or she brings in the door, not those you are "sure" he or she will pick up "in a week or two." That kind of optimistic thinking often leads to disappointment and disaffection for everyone involved.

Instead, hire people with your eyes wide open. Spend several of their first days in close observation of their abilities, initiative and commitment to doing the job right. Be objective, maybe even a little skeptical. Expect them to sell you. Then, sit down with them and decide where they will fit in your operation (if they will fit at all) and what you are willing to invest in training to help them advance.

I'll see you back here next month with details on my competency level system.