If it is the first time you are employing staff take a look at our helpful guide for things to consider.
Decide how much to pay
You must pay someone at least the minimum wage. The following table details the current national minimum wage rates and the new levels which are set to increase in the new tax year 2019/2020.
|Under 18 years||£4.35|
|18 – 20 years||£6.15|
|21- 24 years||£7.70|
|25 years and over||£8.21|
Apprentices are entitled to the apprentice rate if they are either:
- aged under 19
- aged 19 or over and in the first year of their apprenticeship
Agree a gross salary
When employing staff we strongly recommend agreeing a gross salary, whether by hour, monthly or annually. This is to protect you, the employer, because it limits your liabilities. Conversely, if your employee’s personal tax allowance is reduced for any reason and you’ve agreed to pay on a net amount basis rather than agree a gross amount, it will mean that you as the employer, will have to bear any additional costs incurred as the gross amount would therefore increase to keep the net the same.
Check if someone has the legal right to work in the UK
You may have to do other employment checks as well.
Check if you need to apply for a DBS check (formerly known as a CRB check)
Your employee may require one if you work in a field that requires it, eg with vulnerable people or security
PC Payroll can help with DBS checks, if applicable, with fees from £100.
Call our team on 020 8979 6453 for details.
Get employment insurance
You need employers’ liability insurance as soon as you become an employer
Check if your existing insurance policy covers employers’ liability insurance as many do as standard. If not, contact the provider to see if they can offer it as an add-on as this is often simpler than having different policies for different things.
Provide a contract of employment to your employee
You need to give your employee a written statement of employment (contract of employment) if you are employing someone for more than one month.
The Employment Rights (Employment Particulars and Paid Annual Leave (Amendment)) Regulations 2018 – comes into force on 6 April 2019 (and takes effect from April 2020), it implements parts of the Government’s Good Work Plan. As an employer the main implications are:
- The need to provide your new employee a written statement of their employment on day one, rather than as it currently stands within eight weeks of the start date.
- An increase in the amount of information such a written statement must contain.
- All employees are entitled to an itemised pay statement every month.
Parental Choice can produce legal employment contracts which are fully up to date with current legislation and come with the added benefit of legal advice, if required, for the duration of that employment.
Apply for a basic contract through our portal for £95. More bespoke contracts are available from £150 per contract.
Tell HM Revenue and Customs (HMRC) you are employing staff by registering as an employer
If you employ anyone and are paying them £118 per week or more, you will need to register for PAYE and operate payroll. You can do this up to four weeks before you pay your new staff
The PC Payroll team can take the stress and hassle away from you so you are free to concentrate on the business of your business, by administering your payroll and liaising with HMRC on your behalf.
Personal tax thresholds
From April 2019, the personal allowance will rise to £12,500, and the higher rate threshold will rise to £50,000.
Check if you need to automatically enrol your staff into a workplace pension scheme
The employer must automatically enrol all employees into a pension scheme and make contributions to their pension if all the following apply:
- they’re classed as a ‘worker’
- they’re aged between 22 and State Pension age
- they earn at least £10,000 gross per year in your employment
- they usually (‘ordinarily’) work in the UK
Thresholds for 2019/20 are as follows:
|Employer minimum contribution||3%|
|Staff minimum contribution||5%|
|Total minimum contribution||8%|
PC Payroll can assess and guide you through the auto-enrolment process then operate it on an ongoing basis.
Our team can guide you on the minefield of working out what are and are not taxable benefits when you are employing staff.
Get in touch if you are employing staff or wish to change payroll provider
PC Payroll have over eight years experience in running payrolls for individual employers. Please get in touch with our team to discuss your requirements. We can help families employing a nanny or housekeeper, small business owners employing staff or self-employed individuals.
email@example.com | 020 8979 6453
For more details on all things tax related check out the HMRC website
For more details on workplace pensions see The Pensions Regulator