Taking on an employee

A guide to getting it right, first time

A guide to getting it right, first time

When employing staff for the first time, certain procedures must be followed and checks made, otherwise the employer could face hefty fines and possibly even a prison sentence. To help you get the employment process right, we have outlined some essential points of action:

  • Ensure the candidate has a legal right to work in the UK. This is incredibly important. Before taking on an employee, you must check that the candidate is legally allowed to work in the UK. You will need to check particular documents depending on the type of employee you are taking on, and you must keep a copy of these documents. Failure to do so could mean fines of up to £10,000 per worker – even if you unknowingly employ someone who does not have the right to work in the UK (deliberately employing someone that doesn’t have the right to work in the UK you could result in a prison sentence for the employer).
  • Determine the employee’s pay. The least you must pay an employee is the national minimum wage; otherwise employers can be prosecuted which could result in a fine and even a criminal conviction. National minimum wage rates depend on the age of the employee and the type of work they will be doing.
  • Apply for a DBS check (previously known as a CRB check). If your employee will work in a field that requires a DBS check (disclosure and barring service check), for example working with children, vulnerable people and security, you must apply for and secure a DBS check for the employee before they commence work. This is to safeguard all parties involved.
  • Take out employer’s liability insurance. This is compulsory – every employer is responsible for ensuring they have the correct insurance and that it covers all of their employees throughout England, Scotland, Wales and Ireland. A current certificate must be displayed and made available to HSE inspectors when requested. You must also check that your insurer is authorised by confirming with the FCA register.
  • Send a written statement of employment to your employee. If you intend to employ someone for 1 month or more you are legally obliged to provide a contract of employment. This contract must be given to the employee within two months of starting work. Failure to do so could result in being taken to an employment tribunal.
  • Register as an employer. You must register with HMRC as an employer and you can do so up to 4 weeks before you pay your employees. Registering will ensure that you deduct the correct amounts for PAYE and National Insurance from your employee’s wages. PAYE payments must be made when you pay your employees more than a certain amount. You must provide all employees with a written list of deductions you have made from their wages.

This information is intended as a referencing guide only.Please visit the HMRC website for more detailed information and current updates.

As part of our comprehensive payroll service, we provide help and guidance to our clients when taking on employees. If you would like to find out how our payroll service can benefit your company, please speak to one of our friendly team now on 01621 829632.

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