Employing staff for the first time

Deciding how much to pay someone is fairly straightforward but you must pay your employee at least the National Minimum Wage.

Minimum wage

The minimum wage a worker should get depends on factors including their age and if they’re an apprentice.

The National Minimum Wage is the minimum pay per hour almost all workers are entitled to. The National Living Wage is higher than the National Minimum Wage. Workers get it if they’re over 25.

It doesn’t matter how small an employer is, they still have to pay the correct minimum wage.

You can find minimum wage calculations on the HMRC website and use it to check if the correct minimum wage has been paid.

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Workers can check if:

• They’re getting the correct minimum wage
• An employer owes them payments from past jobs

Employers can check if:

• They’re paying the correct minimum wage
• They owe a worker payments from past jobs

Legal right to work

You need to check if someone has the legal right to work in the UK. You may have to do other employment checks as well.

Check if a document allows someone to work in the UK.

Legal right to work checking will determine:

• Which types of document give someone the right to work in the UK
• What a right to work check involves for each of them

Important: There will be no change to the rights and status of EU citizens living in the UK until 2021. You and your family can apply for ‘settled status’ to continue living in the UK after June 2021. The scheme will open fully by March 2019.

Check if you need to apply for a DBS check (Disclosure and Barring Service, formerly known as a CRB check) if you work in a field that requires one, e.g. with vulnerable people or security.

Types of check

You can request the following types of check for potential employees:

• Basic check - this shows unspent convictions and conditional cautions
• Standard check - this shows spent and unspent convictions, cautions, reprimands and final warnings
• Enhanced check - this shows the same as a standard check plus any information held by local police that’s considered relevant to the role
• Enhanced check with barred lists - this shows the same as an enhanced check plus whether the applicant is on the list of people barred from doing the role

Employment insurance - you need employers liability insurance as soon as you become an employer.

Send details of the job (including terms and conditions) in writing to your employee. You need to give your employee a written statement of employment if you’re employing someone for more than 1 month.

Written statement of employment

An employer must give employees a ‘written statement of employment particulars’ if their employment contract lasts at least a month or more. This isn’t an employment contract but will include the main conditions of employment.

The employer must provide the written statement within 2 months of the start of employment.

If an employee works abroad for more than a month during their first 2 months’ employment, the employer must give them the written statement before they leave.

Tell HM Revenue and Customs (HMRC) by registering as an employer.  This can be done up to 4 weeks before you pay your new staff.  

You must register even if you’re only employing yourself, for example as the only director of a limited company.   

Employee payments

You must register before the first payday. It usually takes up to 5 days to get your employer PAYE reference number. You cannot register more than 2 months before you start paying people.

To pay an employee before you get your employer PAYE reference number, you should:

• Check if you need to automatically enrol your staff into a workplace pension scheme

You must enrol and make an employer’s contribution for all staff who:

• Are aged between 22 and the State Pension age
• Earn at least £10,000 a year
• Normally work in the UK (this includes people who are based in the UK but travel abroad for work)