Thinking of employing someone in your business?

So, you’ve worked on your own for what seems like ever, but as the hours you spend sat at your computer screen increases you realise it’s time to take the plunge and hire help.

Employing staff is a hugely positive impact on your business.  Not only can it increase productivity and efficiency but also can add to the skill set you have at your reach.  This all can help to providing a better service to your customer.

However, you need to think carefully before taking the plunge.  Not only is there an additional cashflow cost to your business, you also have to start acting like an employer.  This means more red tape and more responsibilities!

What do I need to do?

Don’t worry, it’s not complicated and by following our tips will help ensure the process is stress free!

Selecting your candidate

While you might have your ideal candidate in mind before you start your process, you must consider that it is against the law to discriminate anyone for their age, gender, race, religion or sexual orientation.  You must treat everyone fairly and equally when you start your selection process.

Registering for employment

Once you have selected your employee, you should register your intention with HMRC.  This is a simple process of providing a few details about your business and when your employee will start.  The process can be completed online here

Employment checks

Every employer has a legal responsibility to ensure their new employee has a right to work within the UK.  The required documents and checks you should request from your employee can be found here.

Pay and minimum wage

Deciding on what you should pay someone will depend on their skill set, experience and the role they will perform.  You can normally check out example rates on job boards offering a similar position to get a better understanding of the ranges offered in the market.

On top of this, ensure you are paying your employee above the national minimum wage limits set each year.  These limits can be viewed here.

Employment contract

You need to provide and ensure both you and your employee sign a contract of employment.  The employment contract will clearly set out the expectations of the employer including, rates of pay, hours of work and holiday entitlement.  It will also discuss disciplinary matters and termination periods.

PAYE obligations

When you agree a salary it is generally a gross figure which includes tax and National Insurance.  When you make the first payment to your employee you must deduct this tax and National Insurance from their gross pay, plus calculate an employer’s NI contribution.

Statutory rights

While you have someone working with you, you will need a basic understanding of the statutory rights they have within the workplace.  These rights cover sick pay, holiday and maternity / paternity entitlement.

Pension Auto-enrolment

Finally, when you employ staff you have to provide a workplace pension for eligible staff.  While, employers do have the option of postponing auto-enrolment for the first 3 months from the start of employment (useful for temporary positions), eventually the employee will decide whether they wish to enrol or not into it.  If an employee opts in to the pension scheme, both you and your employee will have to pay into the scheme.

Posted by Chris Mollan