Top 20 Employment Law Facts you need to know as an employer

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Employment law is for ever-evolving and covers a wide range of employee rights along with employer responsibilities.  From employment contracts to working time directives to minimal wages to dismissals. Complying with employment law helps you recruit and rating happy and productive employees, and can help you avoid expensive disputes and employment tribunal claims.

These 20 key employment rules will help you get started on the right foot.

  1. An employer must register with HMRC (HM Revenue and Customs) before the first payday when you take on your first employee. Payroll must be run and you must issue employees with a payslip detailing earnings before and after any deductions including tax and national insurance. Payroll information must be reported to HMRC electronically every time you pay an employee and pay any tax and NI owing.
  2. Employers must check all staff have the legal right to work in the UK before they start employment and copies of documents provided must be kept for reference.
  3. Employers are entitled to a written statement of employment terms within 2 months of starting work. If employees are taken on for working less than one month are not entitled to a written statement. From 2020, both employers and employees will have the right to a statement of employment from day one.
  4. An employer can only change the terms of an employment contract by going through a consultation process. If a change is enforced without a good business reason or following a correct process, there is a risk of a constructive dismissal claim.
  5. An employment contract exists once a potential employee accepts an unconditional offer of employment, which may be before their employment commences.
  6. You can make a job offer subject to the successful completion of a probationary period. Three to six months is typical; the period needs to be long enough to allow you to judge whether the employee is able to do the job.
  7. Employees are entitled to minimum wage including casual, part-time and agency workers. The National Living Wage applies to workers aged 25 and over and is £8.21 per hour from April 2019. More information can be found within our mini-guide Employment Essentials: A guide to the National Minimum Wage.
  8. Employees are entitled to 5.6 weeks paid holiday per year (at least 28 days for a full-time employee). Part-time workings are entitled to pro-rata. Holiday entitlement will start to accrue from the first day of employment and continues to be accrued during a period of absence, sick leave and maternity leave.
  9. Statutory sick pay (SSP) is £94.25 from April 2019 but some employers will have their own policy in addition to this.
  10. All employers must auto-enrol eligible employees into, and contribute towards, a workplace pension. Unless an employee makes a decision to opt-out of the workplace pension, you will have to provide them with access to a contributory pension and make contributions towards their pension funds.
  11. All employers are responsible for the health and safety of all employees, including those employees that work from home.
  12. A pregnant employee is entitled to paid time off for ante-natal care, which can include parenting and relaxation classes. You can ask for evidence of appointments, for example, a doctor’s letter or NHS appointment card.
  13. New and adoptive parents may be entitled to statutory maternity leave or statutory adoption leave providing they meet qualifying criteria. Employees who qualify are entitled to 26 weeks’ ordinary leave and 26 weeks’ additional leave. Statutory paternity leave covers one or two weeks’ consecutive paid leave where an employee’s partner gives birth to or adopts a child.
  14. Statutory maternity pay (SMP) and statutory adoption pay (SAP) is paid at 90% of the employee’s normal weekly earnings for the first six weeks. For the remaining 33 weeks, it is £146.68 a week or 90% of the employee’s average earnings if lower.
  15. Statutory paternity pay (SPP) is paid at £146.68 a week or 90% of average weekly earnings if lower. Leave must be taken within 56 days of the birth or adoption.
  16. An employee can end their maternity or adoption leave and pay early and share the remaining leave and pay with their partner (if the partner is also eligible) as shared parental leave and pay. They can choose how much of the leave each will take.
  17. Gross misconduct is conduct that is so bad it destroys the employer-employee relationship and merits instant dismissal. You should detail, in your contract of employment or staff handbook, examples of what constitutes gross misconduct. You must also follow fair and reasonable dismissal procedures.
  18. All employers, regardless of size, must provide written details of their disciplinary rules and procedures. There is a Code of Practice that sets out the basic requirements of fairness and, for most cases, provides a standard of reasonable behaviour.
  19. All workers over 18 are entitled to one day (24 hours) off per week and to work no more than 48 hours per week – although they can ‘opt-out’ of this limit. Younger workers are entitled to work no more than eight hours per day and 40 hours per week. They are not permitted to opt-out of these limits, even if they want to.
  20. Almost all employees with 26 weeks’ continuous service are entitled to request flexible working. This includes both full-time and part-time employees.

The Forum of Private Business for many years has produced two main guides, the Health and Safety Guide and Employment Guide, updated yearly and supported by our legal expenses insurance policy along with our member helpline. The Forum is proud of the guides and we continue to add further essential guides to the collection.  We believe that the guides are important for any business owner to refer to, giving up to date, jargon-free referencing.


Note: Above figures quoted are correct at the time of publishing this blog post.