When you take on a new employee there are eight important steps to take.
- Decide how much you want to pay. You must pay your employees at least the National Minimum Wage. You can use the National Minimum Wage calculator to check that you’re paying the right amount. Your payroll company can work out the gross and net calculations for you.
- Decide how much holiday your employee will get. Employers are entitled to 28 paid days off per year. This is made up of four weeks standard leave and eight bank holidays, which are paid, giving an annual entitlement of 5.6 weeks. If your employee works part-time then you can calculate holiday pay by multiplying the number of days the nanny works by 5.6. Or use this handy calculator to work out holiday pay. This is useful if your employee works a number of hours rather than days. Your payroll company can help you to work out holiday entitlement.
- Check that a potential employee has the right to work in the UK. You can do this online. There are stiff penalties for anyone found to be employing workers who don’t have the right to work in the UK, but you won’t be fined if you can prove you’ve done the right checks.
- Register as an employer with HMRC even if you’re employing subcontractors to do construction work. It can take up to two weeks to register and you must register before the first pay day. Your payroll company can do this for you.
- If you’re employing somebody for a month or more you must give them a ‘written statement of employment particulars’ which outlines the conditions of their employment. It will include job title, hours of work, pay and pay frequency.
- Take out employers’ liability insurance. It’s a legal requirement as soon as you take on staff and you can be fined up to £2,500 for every day you don’t have it. There are some exceptions; if you employ a family member. .
- Investigate workplace pensions. If you take on an employee you may have to provide a pension under the new workplace pension rules. Your payroll company may be able to give guidance on choosing and setting up a pension and may be able to run the scheme for you.
- Take up references and carry out other background checks, such as a DBS check, if your employee is working with children, young people, vulnerable people or has access to confidential data or money.