As employers, there are a number of essential responsibilities that must be satisfied every time you hire a new employee, to keep on the right side of the law.
Being an employer carries a range of responsibilities driven by legal requirements to protect both parties. From ensuring the rights of employees are upheld, to the general ethical responsibility you have as an employer to ensure they are fit, well, and happy at work.
The majority of the responsibilities required of employers start from day one of an individual’s employment and continue for the duration of their tenure.
In this article, we take a look over some of the key responsibilities employers have when hiring and growing their workforce.
Ensure each employee has a National Insurance number
Each employee should have a National Insurance number that they provide to you.
All employees pay National Insurance contributions to qualify for certain benefits including a state pension at the point of retirement. NI numbers are also used to ensure that their tax payments are only recorded against their name.
NI numbers are issued automatically to all UK citizens around their 16th birthday. If, for any reason, your new employee does not have a NI number – if they are a new arrival in the UK, for example – they can apply for one online via the Government website.
Maintain accurate employee records
As an employer, you are legally required to keep proper records for your employees for three years. These records should be kept secure and readily available should HMRC request copies.
The records must include what you pay employees and the dedications made, reports and payments made to HMRC, information on employee leave and sickness absence, tax code notices, taxable benefits or expenses and details of any Payroll Giving Scheme.
Failing to keep full, accurate records could not only result in estimations of the amount of tax due but may lead to penalties of up to £3,000.
Take out employers’ liability insurance
Every employer must have employers’ liability insurance. This insurance is designed to compensate employees if they come to harm at work or fall ill due to their job. Employers’ liability insurance also acts as protection for your business if it is sued by the injured or sick party.
By law, every employer must have at least £5 million of cover under their employers’ liability insurance, and the policy must be issued by an authorised insurer.
Ensure each employee has the legal right to work
In the UK, every employee must prove their right to work in the country under the Immigration, Asylum and Nationality Act.
In some cases, such as when using agency staff, the responsibility to verify an employee’s right to work lies with the agency rather than the employer. Nonetheless, in all cases, employees have to demonstrate their legal right to work here in the UK.
In cases where employees don’t have the automatic right to work in the UK, individuals need to prove their right to work by providing their prospective employer with a share code issued via the online checking service that proves their immigatration status.
It is a criminal offence for an employer to employ an individual who does not have the permission to live or work in the UK.
Knowingly employing illegal workers is a civil penalty and the consequences for non-compliance with right to work legislation are severe. Failing to comply can lead to hefty fines of up to £20,000 per illegal worker, and even jail time.
Remind yourself of the rights of your employees
All employees have rights that are protected by law. If any of these rights are not met, employees can seek compensation for failures by their employers.
There are two main types of employee rights: statutory (given by law) and contractual (given by a specific employment contract).
There are many statutory employee rights but the most common cover things like:
- Terms of employment
- Pay
- Working hours
- Discrimination
- Workplace conditions, for example health and safety
Keep a file for each employee
It’s important to keep up-to-date and accurate records for all your employees so that you can use them to calculate their pay and entitlements. You will also need records to give to your employee or their union/representative, or a regulator if requested.
Employee files should include their name, address and contact details, information on their emergency contact, a signed copy of their contract of employment, payment and tax details, and any other important information about them such as the expiration of a visa, copies of right to work status or ID documents.
