Hiring in the UK: What Employers Need to Know

There are more than 5 million private limited companies in the UK that are contributing to the country’s economic growth. To support the business community and safeguard the rights of approximately 33 million employees, the country has a well-defined and stringent legal framework in place. All businesses, both small and large are bound to follow the country's employment laws in order to stay compliant and successfully run their businesses.

This article will discuss the main points of the UK employment law that an Employer needs to know about before they hire someone in the UK, furthermore it will also discuss the importance of an EOR ( Employer of Record) during the hiring process.

An overview of the UK Employment Law

The UK employment law addresses many aspects such as employee rights, workplace safety and anti discrimination measures. It enforces a minimum wage, defines the working hours and and requires equal consideration in hiring, promotions, and firing. 

It will not be possible to cover all aspects of the employment legislation, so we will cover only the core areas that you must know as a UK-based employer.

Employment Contract

In the UK, the law specifies that you need to have an employment contract. Employers are responsible to give their workers a "written statement of particulars" that spells out the main parts of their job within two months of starting. An  employment contract helps employers to ensure compliance and avoid any misunderstanding in the future about the job responsibilities, salary, working hours, benefits etc. 

The country has different types of employment contracts, each with a different set of laws and regulations:

• Full-time and part-time
• Fixed term contracts
• Agency staff
• Freelancers, consultants, and contractors
• Zero-hour contractors
• Employing below the age of 21 or hiring volunteers
• Immigration Contraints

When hiring employees in the UK, the employer has to check the residential/citizenship status of the employee. The employer can also contact the home office If an employee can not provide any documents in support of his status. The non-UK workers are required to have a statutory work visa or permission from the legal authorities to work in the country. People who can enter a contract without permission are:

• A British citizen
• A person with indefinite leave
• A person who has the right to stay in the country
• Spouse of a British citizen
• After Brexit, EU workers no longer enjoy the benefit of automatic working in the UK and should rather go through the same procedures as non-EU workers if they do not have any settled or pre settled status.

Employee Benefits and Compensations

In the United Kingdom, employee benefits and compensation packages usually consist of a mix of legally mandated rights and other benefits provided by the employer. These include:

Paid Annual Leaves

As a UK-based employer, you’re bound to offer 5.6 weeks casual holidays every year to your full-time employees or statutory workers. Those with irregular work hours or 9-5 agency time get the same annual leave benefits.

However, you need to calculate paid leaves for part-timers, depending on the average number of hours they spend at work. The UK law also offers paid maternity and paternity leaves to new parents.

Paid Sick Leaves

According to the UK employment law, employers have to pay a minimum wage (116.75 GBP/week) for at least 28 weeks to employees who are too sick to attend work. You are allowed to pay more than the statutory paid sick leave wage limit, but less than that is prohibited.

Flexible Work Arrangements

Depending on your company’s work policies, you can offer employees flexible working arrangements. You can set the limit for the number of hours, timings, work days, and work location.

Healthcare and Social Security

In the UK, employers do not have to provide any healthcare benefits to employees as the state offers free healthcare benefits and pensions.

Payroll and Taxes

Foreign employers with offices in the UK must use the Pay-as-You-Earn (PAYE) system to calculate the payroll for the local workforce. They provide a clear roadmap for calculating income tax and paying taxes to the government.

Partnering With Employer of Record (EOR) 

Setting up a business and recruiting a workforce in the UK can be complex and time-consuming. An Employer of Record or EOR is a third-party entity well-versed in the UK employment laws and business procedures.

An Employer of Record (EOR) like Swapp Agency makes the UK recruitment process simple -- taking care of all the complexities of local employment, assuming all legal risks and providing companies with a cost-effective way to expand and manage talent in the UK. 

Partnering with them makes navigating the complexities of market entry,hiring, and other HR-related intricacies easier while staying on the right side of the law.

Conclusion

The availability of skilled workers, a well developed digital infrastructure and robust legal framework makes the United kingdom an ideal destination for hiring talent. By partnering with the right EOR you can reduce your administrative burdens, have peace of mind and expand your business operations with ease by hiring the required talent.