A guide for new employers

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What an Employer should know

You started your own Limited Company, the business is growing, you are doing very well. What you need now is a pair of helping hands, maybe couple of pairs or even more? This guide is for New Employers. We discuss law, rights and communication. The things you must do the things you are required to do and the things you might wish to consider. For advice on employment and who to contact please call our office, for Payroll refer to our Services.


You must pay an employee a wage of at least National Minimum.

Year 21 and over 18 to 20 Under 18 Apprentice*
2014 (current rate) £6.50 £5.13 £3.79 £2.73
2013 £6.31 £5.03 £3.72 £2.68


You are not allowed to make any deductions of an employee wages unless:

  • it’s required or allowed by law, eg National Insurance, income tax or student loan repayments
  • you agree in writing
  • your contract says they can
  • there’s a statutory payment due to a public authority
  • you haven’t worked due to taking part in a strike or industrial action
  • there’s been an earlier overpayment of wages or expenses
  • it’s a result of a court order.

A deduction can’t normally reduce the pay below the National Minimum Wage.


An employee normally is entitled to 5.6 weeks paid holiday a year. Most workers who work a 5-day week must receive 28 days’ paid annual leave per year.

Click on Calculator to count holiday entitlement.

*Employees are entitled to holiday leave from their first day of employment.



Notice. An individual is entitled to one weeks notice if you wish to dismiss them. The period increases with the time of employment.

Unfair dismissal.You must have a good reason to dismiss someone. The employee should have an opportunity to appeal. Pregnancy or unauthorised deduction of wages, are automatically unfair and individual has a right to claim unfair dismissal, regardless of how long they have been employed.


The law requires to provide employees with a written contract, within two calendar months of starting work. This should include pay, holidays and working hours. The terms should include employment conditions, rights, responsibilities and duties within the company. There are several different types of contracts:

Please click on each one of them to download an example. © Human Resource Solutions 2015.

Before employing a person it is important to decide which type of contract is right for your business.

Recruiting employees

Step One. You should draft a description of the perfect candidate before advertising. Think of the type of business you are in and the type of position you are looking to fill. Think of education, experience, skills, and interests of the person you are looking for. Don’t forget to mention personal qualities like attitude and character. Potential recruits have a right not to be discriminated against on grounds of sex, race, disability, sexual orientation and other.

Step Two. Advertise with:

  • Short description of your company and services you provide
  • Detailed description of the position you looking to fill. Duties & responsibilities
  • Don’t be scared to actually put up a description of your perfect candidate (drafted before)
  • Outline the salary, working hours and other benefits.
  • Include any bonuses that might attract better candidates.

Advertise effectively using a variety of sources. Local press, internet, Job Centre Plus. You may wish to use recruitment agencies as well.

Step Three. Interview

The best way to pick the right candidate is to interview in stages. Decide of what you want to achieve in each one of them. You may wish to find out about the experience and personal background in stage one, test the skills in stage two and find out about the motivation, self initiative and potential in stage three.


You are allowed/ required to check on potential employees.

  • Right to work in the UK

An employer can be fined up to £20,000 if they can’t show evidence that they checked an employee’s right to work in the UK.

  • Criminal record checks

For certain jobs like working with children or in healthcare, employers need to carry out a criminal record check on new employees before they can start.

  • Health checks

Employers can only ask successful candidates for a health check before hiring someone if:

it’s a legal requirement, e.g. eye tests for commercial vehicle drivers,

if the job requires it, e.g. because their insurers need health checks on cycle couriers.

* Employers must follow data protection rules when handling information on job applicants.

Probation period

Any employer is allowed to appoint a probation period for newly hired employee. Most permanent jobs, whether in academia or in the commercial sector, will involve an official probationary period. It simply means an easier ‘get out clause’ than your full time employment would.

The employer can monitor and make sure the candidate is suitable for the job. This may be in the form of a starting salary that will be raised on completion of the period. It will also usually involve a different length of notice period on both sides, meaning that the employer has to give less notice in order to end the employment.


Training and induction is very important to get your new employee going. You may wish to provide special training in-house or spend some money and provide a professional training outside. It is always worthwhile to invest some money in return of confidence and professionalism you will receive from a worker.


Have company rules and introduce your new employee to it. It should cover absence, health and safety, standards of performance, timekeeping and use of company facilities. Always keep your workers up to date with terms and conditions of employment, disciplinary and grievance, procedures and how they are performing in their jobs. Make sure you keep your employees happy as this increases their levels of commitment and quality of work.


You must operate a payroll if you employ people. For more information and advice please refer to our services or give us a call on 0207 267 6665


For more information please visit www.acas.org.uk 

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