Congratulations, you’ve hired a new employee! Hiring new staff is always an exciting time for your business, but don’t forget that your work doesn’t end once an applicant has accepted a job offer. Before your new employee comes on board, there are a number of steps that you must take in order to comply with your basic legal responsibilities as an employer.
This blog will guide you through what to do after hiring an employee. Specifically, this blog covers registering with HMRC and setting up your payroll system, keeping records of new staff, health and safety obligations, and agreeing employment contracts.
What to do after hiring an employee
Before new employees get started, it’s important to make sure the right legal and HR infrastructure is in place in your business to accommodate them. The consequences of failing to prepare properly vary depending on the legal obligation; at the very least, you risk a disorganised start and a poor first impression of your business on your new staff. Failures in relation to some of your obligations (eg health and safety or obtaining proper insurance) can result in convictions, fines and even prison sentences if the failure is serious enough.
The basic steps you must take after hiring an employee (if you haven’t done these already) include:
- registering with HMRC as an employer;
- writing staff disciplinary and grievance procedures (which can be included as part of your staff handbook if you choose to have one) (see HR policies for guidance and Staff handbook and policies for templates you can use);
- setting up a payroll system;
- setting up a workplace pension scheme;
- obtaining a minimum of £5 million employers’ liability insurance;
- ensuring your premises comply with health and safety legislation and that you have suitable policies and procedures to keep staff and visitors safe; and
- making sure you have appropriate systems and procedures in place for dealing with personal data of candidates as well as all staff.
Additional steps that are not required by law but will benefit your business include:
- putting together a staff handbook to incorporate your policies and procedures for matters from dress code to expenses (see Staff handbook); and
- assigning (and training, if necessary) a specific person or people to deal with HR issues.
Keeping records of new staff
You should always keep the following records about your staff:
- Personal information
Eg. name, address, emergency contact, date of birth, education details, tax code, national insurance details and any disabilities. - Employment history
This could include start date, probation period, promotions, present job title and end date if the employment is temporary. - Terms and conditions
You should retain a signed copy of each staff member’s contract of employment, along with any records or letters confirming any changes. - Absences
You must retain details of staff lateness, sickness, or any other authorised or unauthorised absence. - Hours worked
Track what hours your staff are actually working (including overtime) to ensure you comply with your legal obligations. For further information, see Rules about working hours. - Accidents and illnesses
Certain accidents must be reported to relevant authorities for health and safety purposes, but it is a good idea to record any level of accident (see Keeping records about accidents , illnesses and near misses for further information). - Training and development
Record details of any training or further education undertaken by staff. - Disciplinary and Grievance Proceedings
You should have systems in place to retain details of any disciplinary actions taken against your staff or grievances brought by staff (see Handling grievances and Taking disciplinary action). You must also have a disciplinary procedure and a grievance procedure in place which you must give to your staff; the template Staff handbook and policies includes template grievance and disciplinary policies, which you can choose to generate either on their own or as part of a full staff handbook. - Recruitment and induction
You should retain details of recruitment exercises, including advertisements, job descriptions and person specifications. - Termination
You should retain details relating to staff departures from your company.
Note that for all employers with more than 250 employees, it is a legal requirement to provide gender pay reporting about your workforce every 12 months.
Don’t forget about health and safety!
There is a significant amount of action you must take after hiring a new employee and during the first few days of their employment to comply with health and safety law. Failure to do so could result in avoidable illness or injuries to your staff or even the prosecution of your business. Punishment can include a fine or even up to two years in prison if the failures are very serious.
You should make sure you comply with the following legal requirements before the arrival of new staff:
- You must have employers’ liability insurance which covers your staff in the event of any work-related accidents or illnesses;
- You must have a health and safety policy;
- You must make sure your workplace and equipment complies with health and safety laws;
- You must perform an initial health and safety risk assessment and a fire risk assessment;
- You must train staff appropriately in health and safety matters by:
- nominating a staff member to be in charge of health and safety issues;
- establishing an emergency evacuation plan;
- establishing fire-safety procedures, including use of fire extinguishers and other firefighting equipment;
- establishing adequate first-aid procedures; and
- providing your staff with general information about health and safety risks and precautions in the workplace.
- You must have good housekeeping procedures in place to ensure that floors are kept clear of anything that might cause a person to slip, trip or fall.
Note that if you operate within an industry with specific needs like construction, or if your workers will be engaging in high-risk work such as working at height, with heavy machinery or dangerous substances, there may be additional steps you need to take to address health and safety matters.
Providing employment contracts after hiring a new employee
After hiring an employee or casual worker, you are legally required to provide them with a written statement of the basic terms of their employment (eg pay, hours, holidays) on or before their first day of work.
These written terms don’t have to be in the form of an employment contract, but it’s best to give your employee a full written employment contract so that there is no confusion about what you have agreed. A good employment contract will go further than the basic written terms of employment that the law requires, including eg terms to protect your business such as a requirement to keep your confidential information secret, or a term preventing your employee from working for a competitor for a specified time after leaving.
You can find further guidance on what to include in your employment contracts in our Q&A, along with template employment contracts for junior and senior employees.
The content in this article is up to date at the date of publishing. The information provided is intended only for information purposes, and is not for the purpose of providing legal advice. Sparqa Legal’s Terms of Use apply.
Marion joined Sparqa Legal as a Senior Legal Editor in 2018. She previously worked as a corporate/commercial lawyer for five years at one of New Zealand’s leading law firms, Kensington Swan (now Dentons Kensington Swan), and as an in-house legal consultant for a UK tech company. Marion regularly writes for Sparqa’s blog, contributing across its commercial, IP and health and safety law content.