Time to hire your first member of staff

Time to hire your first member of staff

Yippee, you are doing well, its time to stop using family and friends and calling in favours and take that very grown up step of hiring your very first member of staff.

Firstly, well done, thats quite an achievement, feel very very proud.

Secondly, you are petrified right, well this blog post will hopefully calm things down. Now down to business.

The job description & person specification

  1. Think about what you want them to do, and write that down, forget job titles at this stage, just think job content.
  2. Think about what kind of person in terms of attributes, experience and qualifications (and be reasonable, I’ve come across 2 man bands operating from their front rooms wanting Oxbridge graduates, to do admin)
  3. Research similar roles and no harm in having a nosey at what your competitors are doing (if it ain’t broke etc), this gives you some pointers to setting a salary
  4. Once you have an idea of the salaries the competition are paying, you need to figure out if you can afford it, always remember you need to add another 30% plus in on costs to cover Employers NI (12% of total salary), pension (more of which later), their work environment, other benefits etc
  5. You are now ready to draw up a job description (which describes the role) and a person specification (which describes the attributes at a minimum a person must have to be suitable).
  6. Decide where you are going to find them, i.e. LinkedIn, Twitter, Instagram, websites, agencies, print media
  7. Draft an ad for the job
  8. Its always worth thinking about at this stage where you are actually going to put them, do you need to buy a desk, hire office space even, computers cost how much?

The interview

They’ve started to apply. Wow another milestone passed, people are interested and want to work for you, nervous yet?

  • Work out in advance  of the interview what you want to learn from them
  • Do you just want to have a one on one interview and deal with it all in one go
  • Do you want a demonstration of their work presentation style
  • Do you want someone else’s opinion
  • Prepare well in advance, draft questions, give enough time per person (there is nothing worse that candidates bumping into one another in the corridor or reception.
  • You’ve decided you’ve found the one!
  • You need out of politeness to let the others down gently, you never know when you’ll bump into them again, so be nice.

You found THE ONE

(now the real fun starts)

  • You need to offer them the job (provisionally usually), apply for references, make sure you have employers liability insurance (up to 5 million at least). Look at the partnership tab on this website which will help you.
  • Give them written particulars which at a minimum should contain salary, pension arrangements, start and finish (where applicable), place of work, date of pay, where they are based, disciplinary and grievance processes, termination and leaving, probation, any benefits, confidentiality etc. If you don’t do this within 28 days of them starting well you have been told!
  • Why not think about including a staff handbook (give us a call) and HR policies & procedures (again you know where we are) and you are covered.
  • So references, qualifications all check out, terms are agreed and a start date sorted

Before they start

You need to think about a probation period, how you are going to pay them (we can point you to some brilliant payroll providers and accountants), what sort of induction (please have one) process you are going to have.

You are pretty much now ready to welcome your first employee. Good luck and well done, the second time is always easier.

You are on your way.

Pensions – auto enrolment!

Pensions – auto enrolment!

Its Halloween – scary stuff I’m about to tell you

Pension – auto enrolment – get your head out of the sand right now.

Most of the blog posts here are driven by a client query or question. However I am not asked that often about pensions, so I am driving this one. and its about Pensions – very exciting I know but it is Halloween so read on regardless and be afraid, be very afraid.

Bottom line is this, all employers big or small need to have set up a pension scheme by the very latest 1 April 2017. No if buts or maybes.

So you all need to be thinking about pension – auto enrolment NOW!

In a short sentence, all UK employees over the age of 22 and up to the state pension age, earn more than £10k per annum in all workplaces need to be automatically enrolled in a workplace pension scheme unless they choose to opt out. Its the law so no getting around it.

If you have a workplace pension scheme and you already contribute to ALL of your employees pensions then read no further, however you will have to automatically enrol every employee unless they choose to opt out.

Will it cost employers?

You betcha

So how much is all this going to cost me, well the law says a minim percentage of your ‘qualifying earnings’ must be paid into your workplace pension scheme.

‘Qualifying earnings’ are either:

  • the amount you earn before tax between £5,824 and £42,385 a year
  • your entire salary or wages before tax

You as the employer chooses how to work out an employee’s qualifying earnings.

The minimum an employee  pays The minimum you the employer pays The government pays
0.8% of their ‘qualifying earnings’ rising to 4% by 2018 1% of the employee’s ‘qualifying earnings’ rising to 3% by 2018 0.2% of the employee’s ‘qualifying earnings’ rising to 1% by 2018

If an employer offers a defined contribution scheme, the minimum amounts can go up in October 2017 and October 2018.

The minimum amounts could be higher for employees or your employer because of each companies pension scheme’s rules. They’re higher for most defined benefit schemes.

In other schemes the employee and you the employer have the option to pay in more than the legal minimum. An employee can pay in less – as long as you the employer puts in enough to meet the legal minimum.

This really is a minefield and I suggest those of you who have not even thought about pensions yet as you may believe ‘you are too small’ then you need to contact a financial adviser and get one in place. NOW!

This rather scary looking staging chart shows the dates you need to have a pension scheme in place.

These two websites are very helpful

www.gov.uk/workplace-pensions

www.thepensionsregulator.gov.uk

Don’t ignore it, CLICK on those two links and act.

You have been warned!

Staging dates by PAYE scheme size or reference

PAYE scheme size or reference Staging date
120,000 or more 1 October 2012
50,000-119,999 1 November 2012
30,000-49,999 1 January 2013
20,000-29,999 1 February 2013
10,000-19,999 1 March 2013
6,000-9,999 1 April 2013
4,100-5,999 1 May 2013
4,000-4,099 1 June 2013
3,000-3,999 1 July 2013
2,000-2,999 1 August 2013
1,250-1,999 1 September 2013
800-1,249 1 October 2013
500-799 1 November 2013
350-499 1 January 2014
250-349 1 February 2014
160-249 1 April 2014
90-159 1 May 2014
62-89 1 July 2014
61 1 August 2014
60 1 October 2014
59 1 November 2014
58 1 January 2015
54-57 1 March 2015
50-53 1 April 2015
Fewer than 30 with the last 2 characters in their PAYE reference numbers 92, A1-A9, B1-B9, AA-AZ, BA-BW, M1-M9, MA-MZ, Z1-Z9, ZA-ZZ , 0A-0Z, 1A-1Z or 2A-2Z 1 June 2015
Fewer than 30 with the last 2 characters in their PAYE reference number BX 1 July 2015
40-49 1 August 2015
Fewer than 30 with the last 2 characters in their PAYE reference number BY 1 September 2015
30-39 1 October 2015
Fewer than 30 with the last 2 characters in their PAYE reference number BZ 1 November 2015
Fewer than 30 with the last 2 characters in their PAYE reference numbers 02-04, C1-C9, D1-D9, CA-CZ or DA-DZ 1 January 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers 00 05-07, E1-E9 or EA-EZ 1 February 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers 01, 08-11, F1-F9, G1-G9, FA-FZ or GA-GZ 1 March 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers 12-16, 3A-3Z, H1-H9 or HA-HZ 1 April 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers I1-I9 or IA-IZ 1 May 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers 17-22, 4A-4Z, J1-J9 or JA-JZ 1 June 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers 23-29, 5A-5Z, K1-K9 or KA-KZ 1 July 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers 30-37, 6A-6Z, L1-L9 or LA-LZ 1 August 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers N1-N9 or NA-NZ 1 September 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers 38-46, 7A-7Z, O1-O9 or OA-OZ 1 October 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers 47-57, 8A-8Z, Q1-Q9, R1-R9, S1-S9, T1-T9, QA-QZ, RA-RZ, SA-SZ or TA-TZ 1 November 2016
Fewer than 30 with the last 2 characters in their PAYE reference numbers 58-69, 9A-9Z, U1-U9, V1-V9, W1-W9, UA-UZ, VA-VZ or WA-WZ 1 January 2017
Fewer than 30 with the last 2 characters in their PAYE reference numbers 70-83, X1-X9, Y1-Y9, XA-XZ or YA-YZ 1 February 2017
Fewer than 30 with the last 2 characters in their PAYE reference numbers P1-P9 or PA-PZ 1 March 2017
Fewer than 30 with the last 2 characters in their PAYE reference numbers 84-91, 93-99 1 April 2017
Fewer than 30 unless otherwise described 1 April 2017
Employer who does not have a PAYE scheme 1 April 2017
New employer (PAYE income first payable between 1 April 2012 and 31 March 2013) 1 May 2017
New employer (PAYE income first payable between 1 April 2013 and 31 March 2014) 1 July 2017
New employer (PAYE income first payable between 1 April 2014 and 31 March 2015) 1 August 2017
New employer (PAYE income first payable between 1 April 2015 and 31 December 2015) 1 October 2017
New employer (PAYE income first payable between 1 January 2016 and 30 September 2016) 1 November 2017
New employer (PAYE income first payable between 1 October 2016 and 30 June 2017) 1 January 2018
New employer (PAYE income first payable between 1 July 2017 and 30 September 2017) 1 February 2018

Information taken from www.gov.uk/workplace-pensions

Employee benefits – feast or famine

I was recently asked by a client what employee benefits they should offer and should they include Private Health, Critical Illness and Death in Service and you may be surprised to learn that I recommended they didn’t. Why you old scrooge I hear you all say, well firstly they need to think about their staff demographic, then ask them what employee benefits would be more relevant. They may well be as surprised by their employees answers as they were to mine.

If I had a pound for every time I mentioned a pension or Private Health to a perspective employee as a perk and got the answer ‘I’m too young to think about that’ or ‘I’d prefer the holiday’ or I’d prefer the money as rents are too high’ I again might not have to follow this as a career option.

When thinking about offering employee benefits first think about the demographic, younger people at the start of their careers in their early to mid twenties in the prime of their health generally tend not to think about providing for yet to be born families, death, injury or even pensions. What they tend in the main to want are more time off, flexible working, gym membership, good working environment with a social life built in and a bonus. If thats your demographic then offer them something along those lines they’ll appreciate it more.

If your demographic is moving up the age scale then Group Income Protection, pensions, private health all become more important in terms of employee benefits especially when they start having to provide for families.

If your demographic is heading towards retirement, then allowing them additional pension top ups, financial advice,share options are again all employee benefits to consider.

To summarise my point, don’t through good money away on employee benefits that might not be relevant or appreciated until you have looked at what your staff might actually appreciate and what is important to them at this stage in their careers.