Employment law: A quick guide for small business owners

Here, we look at the key employment law considerations for those taking on staff for the first time.

Make sure your business is acting legally when it comes to dealing with employees

Make sure your business is acting legally when it comes to dealing with employees

If you’re taking on staff for the first time, it’s crucial to get to grips with employment law.  Employment law encompasses dozens of different laws and acts in relation to the rights of employees, including disability discrimination, senior employees rights, health and safety and contracts to name but a few.

Due to the complexity of this legislation, medium to large companies often choose to employ solicitors or business advisers to make sure that all the procedures are watertight in terms of the law and how they treat and deal with employees and their disputes.

Statutory rights

Some of the basic things to consider and make sure that you adhere to include the statutory rights of an employee.

These rights cover a multitude of directives and responsibilities for the employer to adhere to.

These include the right to a written contract, an itemised pay slip, to be paid at least the national minimum wage, the right to at least 28 days paid holidays (including bank holidays) and, in some cases, paid maternity leave. Failure to comply can leave employers with hefty fines.

Freelance workers

The rules and regulations are different again for workers who are not classed as employees, such as agency workers or freelance workers.

Most workers are still however entitled to a number of rights, such as the right to be paid at least the minimum wage, limits on working time and for their employer to adhere to health and safety regulations.

For best practices, employers should consider producing an employee handbook.

This can provide guidelines for new employees and also be a standard reference point to help resolve any disputes that may occur within the business.

Drafting employee workbooks is also something that solicitors can potentially assist with, although there are many useful resources online.


Contracts of employment are important for both the employer and the employee, and again it is vital that it corresponds to the relevant employment laws.

The contract should set out the employee’s duties, responsibilities, rights and employment conditions. According to the government website, ‘as soon as someone accepts a job offer they have a contract with their employer’; it doesn’t have to be a written contract.

Other elements of a contract include implied terms, collective agreements and a written statement of employment particulars.

Here is a quick overview of other responsibilities for employers in relation to employment law:

1. As an employer you are required to give each employee a written and itemised pay statement which details gross salary, any deductions made and the employee’s net pay.

2. Employees are entitled to statutory sick pay commencing the fourth consecutive day they do not attend work due to illness.

3. A new law means that by 2018 employers must automatically enrol workers into a workplace pension scheme if the employee is aged between 22 and pension age, if they earn more than £10,000 per year and if they work in the UK.

4. Employers are also responsible for their employees’ wellbeing at work. This includes health and safety responsibilities and compliance, issues relating to discrimination, bullying, maternity/paternity and adoption leave.

Employers must comply with the Health and Safety Act, which in practical terms means that you must, where applicable, carry out a thorough risk assessment, have a health and safety policy and a paper-trail for recording injuries and accidents at work.

Employers should also have liability insurance and have dismissal, disciplinary and grievance rules set out in writing.

5. Employees are also entitled to time off for a number of different reasons and in the event of certain circumstances/occurrences.  For example emergency leave and maternity leave should be available in addition to standard holiday entitlements. Employees are also eligible to ask for flexibility in terms of working hours.

Expanding a business and employing new staff should be an exciting prospect; however it’s important to make sure that you and your company adhere to all the necessary laws and regulations when taking and employing a growing team.

As a starting point, take a look at the ACAS website and the relevant section of the government site to find out more information on this important topic.

Further reading on employing staff


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