Checklist for hiring your first employee 

As your business takes shape you may want to take on staff to help you. Hiring staff can be a daunting exercise, especially if you haven’t done it before. It may mean spending a bit of time away from running your business to conduct interviews and to advertise the role. You will also need to consider the legal requirements, such as registering with HM Revenue & Customs and paying the correct minimum salary.

Below are key points to consider when hiring staff:

  1. Registering with HMRC: You will need to register with HM Revenue and Customs as an employer, this can be done up to 4 weeks prior to the employee starting. 
  2. National Minimum wage: There are different rates of National Minimum Wage depending on the type of employee (for example an apprentice is on a different rate to an ordinary employee) and their age. You can be fined if you pay the incorrect rate.
  3. Insurance: There are a number of different types of insurance policies a new business owner may acquire such as Public Liability Insurance, Professional Indemnity Insurance, Product Insurance etc. As an employer you are legally required to have Employer Liability Insurance to safe guard employees.
  4. Right to work documents: Failure to check if an employee has the correct documents can result in a fine of £20,000 per employee. Right to work documents are documents that prove an employee’s identity and their right to work legally in the UK
  5. DBS: Depending on the nature of the role an employer may have the right to conduct a criminal records check, also known as a Disclosure and Barring Service check (DBS check) on the job applicant. Employers will generally conduct DBS checks in sectors such as security or within the care sector. This is to ensure employers hire suitable candidates for the role
  6. Contracts: Most employees are legally entitled to a written statement of the main points of their employment within 2 calendar months of starting work. Having a contract in place can help to minimise any disputes and manage the expectations of an employee.
  7. Pension automatic enrolment: As an employer you are required to give an employee a month to decide whether they want to be automatically enrolled on to the Pension Automatic scheme or to opt out.

At Markel Law we provide specialist business start-up advice to SMEs. Follow this link to find out more about Markel Law and how we can assist your business.