How to prepare for your first employee

Running your own business is a great opportunity to earn whilst being independent, and to enjoy the freedom to make final decisions on everything from your workload to holiday dates, without interference from anyone else. In some cases, small businesses are owned and operated by one person for the long term, but in others, there comes a time when it feels right to expand things a little, and take on someone to help out.

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Hiring your first employee is an exciting prospect for any small business owner, but it is a process which needs to be approached carefully, to avoid any legal hiccups or financial disasters in the future. So, before you even put an advert together, or approach an employment agency, make sure you fully understand and feel able to prepare for the key points, and the extra responsibilities, that being the boss of someone else involves.


Anyone employed in the UK must have the legal right to work there, and asking for passport identification during the application process is the simplest way to determine this is the case. Non UK passport holders may still be eligible for employment, and further advice on this is available on the government’s website.

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Some professions, such as work with young or vulnerable people, require all employees to have a DBS check (previously known as a CRB check). Companies such as can offer further guidance and affordable options on this.


Be prepared to ask for and to follow up on references. These could be from current or previous employers, volunteer positions, or character references from citizens of good standing in the community.


You are free to decide on the salary you want to offer, but it must be at least the minimum wage for the age group your employee falls into.

Arrange for employer liability insurance.

New employees who have had a job in the past should provide a copy of their P45 immediately upon appointment. This is essential for you, as it is necessary for calculating the correct tax deductions from your worker’s salary. Check if workplace pension contributions are required.


Employees need a written statement of employment immediately (if the job will last longer than one month), and a written contract within 2 months of actually starting work.

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