As a small business owner, hiring your first employees is a big step. It means you’re ready to expand your business but it also means you have a responsibility to others for the first time.
To help make sure you are fully informed, we’ve put together a handy guide of things to consider before employing your new members of staff.
Only take on employees when you know you can afford them. For the first time, you will be responsible for other people’s livelihoods, so be sure you can pay wages, tax and National Insurance every month. Take a detailed look at your accounts and have a business plan in place for how you’d like to expand over the next 12 months or so.
Work out how much you are going to pay employees. The National Minimum Wage is currently £6.50 (correct as of June 2015), however, you must do your research to decide on the correct figure for your type of business. Look at the ‘going rate’ in your area, as this might be higher than the Minimum Wage and will make the market more competitive. Of course salaries for different roles vary, so the key here is to do plenty of research and make sure you are offering a competitive figure, in order to attract top talent.
By hiring employees, you are committing to a number of responsibilities. These range from providing a detailed job description to setting out overtime requirements. The Department of Work and Pensions provide useful templates for such documents.
Take out employment insurance. Of course you hope that your staff will not be injured at work, but it is your legal responsibility to have minimum employers’ liability insurance cover of £5m. Failure to get employers’ liability insurance could result in fines of up to £2,500 a day.
You must send details of the job (including terms and conditions) in writing to each new employee. If you are employing someone for more than one month, you need to give them a written statement of employment.
Register as an employer with HM Revenue and Customs (HMRC). You can do this up to four weeks before you pay your new employees.
Hiring your first employees can seem like a daunting task but with thorough research and detailed preparation, every person on your team should add profit to your business.
Are you looking for talented individuals to join your company? Get in touch with Supertemps to hear about their latest candidates.
– written by Katy Ratican