If you are taking on employees as part of your start up process, it’s essential to be on top of your legal obligations from the outset. Employment law is an area that is constantly changing, and getting it wrong can not only be costly but prevent your business from succeeding. Here are our 6 employment law essentials for start-ups.
Make sure you’ve covered these essentials…
Make sure you have appropriate employers’ liability insurance in place before you take on staff.
Register with HMRC
As a new employer, you need to make sure you are registered as an employer with HMRC between 2 months and 4 weeks before you start to pay your new staff. This applies even if you are employing yourself as the only employee of your start-up – e.g. as the director.
New rules have come in to force which mean you will have to check that your potential employees have the legal right to work in the UK. Depending on the type of job you are offering, there may be other checks you need to carry out. If you are employing people to work with children or vulnerable adults, you may need to carry out DBS (Disclosure and Barring Service) checks to establish if your potential employees have criminal records.
Pay & T&Cs
Decide how much you are going to pay your staff, working hours, how much holiday employees will be entitled to, and any other benefits that will apply. You will also need to set out matters such as disciplinary rules and a grievance policy. There are minimum standards that apply in many cases – for example the National Minimum Wage, and rules on working time and holiday entitlements. Consider whether these will be enough to attract the type of employees you are looking for. If not, carry out some benchmarking to ensure you are offering a competitive package.
The Recruitment Process
Once you are set up to start employing, bear in mind that employment law isn’t just something that starts once you have employees on board – it’s essential to understand that employment law covers the recruitment process too, from the wording of job adverts to interviews and making the offer of employment.
If you decide that you need to have someone for a short period of time working on a project then you need to have an NDA (Non-Disclosure Agreement) in place. This is a legal agreement between the company and the contractor that outlines the framework of the relationship and will protect any type of confidential and proprietary information that the contractor may have access to.
Employment law can seem to be a minefield for start-ups, but it’s vital to be on top of it. Get it right at the outset and you’ll have a firm basis for moving forward.