Businesses are not required to start an LLC in order to hire employees in California. But, if you plan to grow your company and would like to protect your personal assets while doing so, we recommend starting one. To learn more about the LLC formation process and hiring employees check with the Internal Revenue Service (IRS) about obtaining an Employer Identification Number (EIN) and with the California Secretary of State when forming a business entity that plans to hire employees. Learn more in our How to Hire Employees guide.