The hiring of a first employee is usually a huge deal considering that you will not only be making them responsible for a portion of your business, but you’ll also have to be conscious of your obligations and duties as the employer. You might consider using a company such as Payroll For Nannies to help ensure things are above board.
Here are a look at ten things you must have in mind when hiring a first member of staff.
1. Perform Applicant Checks
Once you’ve identified a suitable candidate that can fill the position you have advertised, take the time to ensure that they:
a) Have the right to work in the United Kingdom
b) Pass all the checks appropriate for the position they are about to take on – in particular, criminal record checks and a DBS or Disclosure and Barring Service check if they will be working with children in any capacity.
2. Provide a Written Statement of Employment
You are required to provide anyone who’ll be working for you for more than a month a written statement of employment. This document provides employees with the conditions of employment and should be delivered to them within two months of commencing work.
3. All Employees Should Have a Contract of Employment
You are also required to provide your employees with a contract of employment. This document outlines the employee’s responsibilities, rights, and working conditions. This does not have to be a formal document; however, it should contain both implied and explicit terms of employment.
4. Ensure Your Business is Well Insured
Insurance will protect you and your company from claims made by staff who’ve fallen ill or injured at the workplace. Unless you run a business where only close family works for you or personally provides services to clients, it is required that you take out Employer’s Liability insurance cover as per the terms of the Employer’s Liability Act (Compulsory Insurance) of 1969.
5. Register Yourself as an Employer with Her Majesty’s Revenue and Customs
In almost all cases, you have to register yourself as an employer with Her Majesty’s Revenue and Customs within a month of hiring your first employee. As an employer, you are responsible for paying your workers a pre-agreed salary, and deducting National Insurance Contributions and income tax (PAYE) from their wages.
6. Paying Employees
When paying workers, you have to provide each worker with a payslip detailing their net and gross pay, NICs and income tax deducted, and any other deductions like pension contributions. Since the Real Time Information (RTI) regime was implemented in 2013, employers are also required to submit payroll data to Her Majesty’s Revenue and Customs each time they pay their staff. In previous years, this information was to be provided at the end of every tax year.
It is worth noting that you are required to comply to UK’s National Minimum Wage.
7. Know Your Health and Safety Obligations
As an employer, you need to understand that you’ll be responsible for providing employees with a secure and safe work environment. You do not need a formal Health and Safety Policy unless you have more than five employees; however, make sure that you take the time to assess the risks your employees will face at work.
8. Pension Auto-Enrollment
New legislation passed in 2013 requires that employers enrol their workers into a pension scheme if they’re 22 years of age or older and earn over £9,440. The rules initially affected larger businesses but became applicable to all employers in 2018.
9. Be Aware of Maternity/Paternity Pay, Sick Pay and Holiday Rules
The legislation governing employees’ rights when it comes to taking time off due to forced absence periods or for holidays is quite broad.
10. What Happens When Things Do Not Work Out?
Possibly one of the most complex areas of employment legislation encompasses what happens when employees are made redundant. If you do not handle dismissals reasonably, or one of your employees resigns because you breached the employment contract, the disgruntled ex-employee could decide to take your company to an employment tribunal.
An employment tribunal usually deals with the circumstances behind the dismissal, disagreements over pay, and any discrimination.