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Hiring your first employee: everything to set up before their first day
The first hire is the biggest step a small business takes. Before their first day, there are a few legal steps and a payroll to set up. Here they are, in order.
Taking someone on changes how your business runs: there will be someone to pay every month, and rules to follow. None of it is difficult if it is done in the right order.
Before the first day
- PaySet the wage, at least the National Minimum Wage for their age, and budget for National Insurance and pension.
- Right to workCheck and copy their documents, or use the online checking service.
- RegisterSet up as an employer with HMRC, up to two months before the first payday.
- InsureTake out employer’s liability insurance: it is a legal requirement for most employers.
- ContractGive a written statement of the main terms of employment on or before day one.
- PayrollChoose software that reports pay to HMRC on or before each payday.
In the first weeks
- Assess them for auto-enrolment and write to them about the workplace pension.
- Add them to your health and safety arrangements and any training.
- Agree how holidays, sickness and expenses are recorded.
Payroll is easy to underestimate. A mistake in the first month carries on until it is spotted. Many small businesses hand it to their accountant from the start, which also keeps the pension and HMRC filings in one place.
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This insight is general information, not advice for your circumstances. Talk to us before acting on it.