So you’ve started a new business.  Congratulations!  But you have a to do list that is as long as your arm and growing!  Maybe you are working alone and have decided you need to hire someone or you need extra hands from the beginning.  This can often be one of the biggest decisions for the entrepreneur but there are often concerns about the complexity or restrictions surrounding the hiring of employees.

 The good news is that if you are hiring people in the UK you only need do FOUR things:

  • You must undertake a right to work check – this is often done by the employer themselves.  You need to see the original of a birth certificate or passport and keep a copy noting the date that you checked this.  If the individual is a UK or EU national (at least for now….) then your checks are fine but if they are from elsewhere then you must ensure that their visa / work permit allows them to work in the UK.  This step is usually simple but unless you know exactly how to ensure the documents are legitimate then it can have an element of risk to it.  If you are unsure then you may need to have them properly verified by an immigration advisor.
  • You must pay the person through a properly registered PAYE scheme – I usually recommend to businesses that they use the payroll services provided by or recommended by their accountant to make the whole matching up of payroll and tax information as simple as possible.
  • You must issue them with a statement of terms and conditions.  This satisfies the minimum you are obliged to do but a properly structured contract will also maximise the protection for the company.
  • You must have Employer’s Liability insurance in place – whoever the company is using to arrange their own PI, D&O, Public Liability cover can usually also arrange this as well.

Once you have done all of these you have complied with the relevant legislation (obviously if your employees need other training or certification eg construction site health and safety training, food handling awareness etc then you have to do that as well) to hire your first employee.

You should however consider whether these minimum steps are enough for your business and therefore there are five further steps that I recommend you consider undertaking.  The first two steps I would highly recommend doing now and the latter three can be done at a later stage if you wish.

  • Undertake pre-employment screening – even if you have known or worked with the person previously.  There are many reasons for doing this including a proper governance structure, to satisfy investors that this aspect of due diligence is covered, a sensible approach to employee risk management etc.
  • Establish an effective on-boarding process for new employees so as to minimise the time it takes to make the new employee effective
  • Effective but not excessive HR admin
  • Ensure that all documentation (eg employment contracts, offer letters, employee handbook) are appropriate for the business, protects the business and reflects the ethos or culture of the Company
  • Consider the HR policies that the company will have eg holidays, maternity, paternity, sickness etc.  You may wish to incorporate these in an employee handbook appropriate for the size of business

The HR aspects of hiring and employing people need not put you off doing so.  If you need any help with any of these steps please do get in touch.

Best wishes for your business.