As a company grows, it is likely that you will have to consider employing a workforce that has the required skills to enhance the business. Employing a workforce will entail further administration, perhaps requiring an outsourced accounting service to reduce the costs and burden on existing resources.
Paying your employees
When considering how much you are going to pay employees, there are regulations in place to ensure a fair wage. The National Minimum Wage varies according to age, and once a person reaches the age of 25 they will be entitled to the National Living Wage. All employers must pay the correct level of wage to a workforce, irrespective of the company size or number of employees.
Can you employ anyone?
Although you may think that you can employ the most suitable candidate from the applicants for a position, you have to conduct checks to make sure a person is legally entitled to work in the UK. There are specific documents you have to check so that you know they are eligible for UK employment.
Employers’ Liability insurance
Once you employ someone, you must take out employers’ liability insurance. Current regulations state that you must have cover of £5m or more and be provided by an authorised insurer. The insurance is to protect you if a worker has an accident at work or is injured during the course of their duties. Failure to display the insurance certificate or produce it when requested could result in daily fines of £2,500.
HMRC
HMRC has to be informed when you take on employees, as you will need a PAYE scheme. Employers can register with HMRC online, but must be registered two weeks before the first payment is made to a worker. If you are employed by the company, and you are the only employee, you must still be registered. You will have to be registered and ready to deal with the Real Time Information system, as the payments made to employees are now recorded in real time, ensuring payments are correct.
Pensions
All employers are now required to enrol workers into a workplace pension scheme, and have until 2018 to comply with this requirement, although all employers have been given a staging date up to that time. HMRC will notify you of the date. If you don’t have a PAYE scheme, the date to complete auto enrolment will be 1st April 2017.
Setting up a workforce can be a complex process, which is why many employers choose to outsource. If you would like to know more about your responsibilities as an employer, contact us for an informal chat.