Employing staff for the first time - Business Works
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Employing staff for the first time

Deciding to take on employees for the first time is a huge milestone for any business. So, before taking the next step it is important to be fully prepared.

Gareth Matthews, an employment law solicitor at MLP Law, looks at the key issues involved and advises business owners on the steps they must take and plan for before embarking on the recruitment process.

Recruit fairly

Discrimination law applies to potential and actual job applicants, as well as to employees. Your recruitment processes, therefore, must not discriminate against anyone on the grounds of a 'protected characteristic', which includes sex, race, age and disability.

This means that any vacancy advertisements or job descriptions must not discriminate against any particular group of people and your process of selecting one candidate over another must also not be discriminatory. This can be tricky where an aspect of the role appears to apply equally to everyone but has a disproportionate effect on certain groups of people (known as indirect discrimination).

Employees have rights

Employees acquire a number of significant employment rights from their very first day of employment. These include the right to written terms of employment, the right to receive payslips, the right not to be discriminated against and certain maternity rights.

Employees are also entitled to be paid at least the national minimum wage, receive a minimum number of holidays and be given a minimum period of notice on termination. Employees acquire further rights as they accrue further service with your business. This includes the right to maternity pay and the right not to be unfairly dismissed.

Breaches of these rights can lead to employment tribunal claims being brought against your business, so it's vital you have all the correct policies and procedures in place.

Employment contracts and handbooks

Employees' employment rights are enshrined in law. However, contracts and handbooks can be used to protect your business and set clear workplace standards. By way of example, clauses in employment contracts can be used to protect your confidential information, intellectual property and company property, as well as to prevent your employee working for a competitor after they leave your business.

Handbooks can be used to put in place company rules, as well as to set standards of behaviour (such as in relation to equality and diversity, anti-bullying and social media use). They can also be used to clarify how any workplace issues will be resolved, such as under a disciplinary or grievance procedure.

Don't forget about insurance

Before taking on employees, the vast majority of employers are required to put in place "Employer's Liability Insurance", with cover of at least £5 million. For every day this insurance is not in place, you could be fined up to £2500.

The insurance policy is important as it will protect the business against any personal injury claims brought by employees.

Immigration and DBS checks (previously known as CRB checks)

Whilst ensuring that you don't discriminate, you must also ensure that your new employee has the right to work in the UK. Any employer who unknowingly employs an illegal worker could be fined up to £20,000 for each illegal worker they employ, whilst any employer who knowingly employs an illegal worker could face criminal prosecution (including a prison sentence).

Depending on the nature of the business, criminal records checks may also be required to determine whether your new employee is suitable for the role. This will be relevant where you work in industries where the integrity of the employee is key (such as financial services) or where the role involves work with children or vulnerable adults.

Registering with HMRC

New employers need to register with HM Revenue and Customs (HMRC) to be given a HMRC Payroll number. This will be used to calculate PAYE deductions for individual employees, as well as to calculate the date automatic pensions obligations will begin.

You must register with HMRC before the new employee's first payday and can do so from around four weeks in advance of taking on them on.

For more information, please visit: www.mlplaw.co.uk.

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