Taking on your first employee is a big commitment which brings fresh challenges in terms of rights, responsibilities and the law. Mark Krull, Director at Logic4training, looks at the implications of becoming a boss.
Employing staff can be a daunting prospect for many sole traders,but if you’ve reached the point where you’re struggling to meet customer expectations, recruiting an extra pair of hands can prevent standards from slipping as well as generating more business long-term.
Before you begin, you need to think carefully about why you need extra help and how you will pay for it. What tasks will your employee be responsible for day-to-day? Do you need someone full or part-time? Would an electrical apprentice be suitable, or are you looking to grow your business with new skills?
Stay profitable
If cashflow varies from month-to-month and you’re worried about paying a regular monthly salary, employing the services of a self-employed worker or sub-contractor is an alternative option. Although you might be paying a higher hourly rate for their services, the additional flexibility might take the pressure off in the early days.
Deciding how much to pay employees is a difficult balancing act. It needs to be enough to attract the level of experience you require, but it also needs to be affordable to your business. Of course, you must pay at least the National Minimum Wage – currently £7.50 for over-25s – but could also consider the higher Living Wage, which is based on current living costs.
Record keeping
There’s a certain amount of extra paperwork involved in employing someone. You’ll be responsible for paying income tax and National Insurance on behalf of your employees through HMRC’s PAYE system, or the Construction Industry Scheme (CIS) for sub-contractors. At least three years’ worth of accurate employee records must be available to produce to HMRC, if required. If admin really isn’t your thing, you could enlist the help of a numerically skilled family member instead.
Rights and responsibilities
Employees are subject to certain statutory rights, such as paid holiday, maternity/paternity leave, sick pay and a Workplace Pension Scheme. Restrictions apply to employees’ working hours and they’re legally entitled to daily and weekly rest breaks. However, these rights represent a minimum requirement and you may wish to provide a more attractive benefits package. You may decide to offer employer funded training to ensure employees are up-to-speed with the industry updates and legislation changes
common to the electrical sector.
Employees are subject to certain statutory rights, such as paid holiday, maternity/paternity leave, sick pay and a Workplace Pension Scheme. Restrictions apply to employees’ working hours and they’re legally entitled to daily and weekly rest breaks.
Under the Health and Safety at Work Act 1974, employers must do what is reasonable and practicable to manage the health and safety of their employees. Risk assessments and Employers’ Liability Insurance are particularly important considerations for electrical employers carrying out high-risk business activities.
Aside from safety issues, employers also have a duty to avoid discrimination, during recruitment and employment. If you’re unsure about this, or any other legal issues surrounding employment, then you should seek professional legal advice.
Happy workforce, healthy business!
Finally, good management is the key to a contented, motivated and productive workforce. Consistency, trust, clear expectations and taking a genuine interest in your employee’s needs and ambitions will bring out the best in you and your employee, taking you from one-man-band to small business success.
