How to Hire Your First Employee in 6 Steps

This is an exciting time, to be sure – it’s a sign that business is going well, and you can bring someone in to help you with the day-to-day.

According to Conor McArdle, Content Executive at Opus Energy, this is also a great opportunity for you to think about how your role within your business may develop, and how to make the most of it.

But, before the excitement carries you away, there’s a lot of important things to get done. Making sure you follow the correct process can help to lay the foundations for a smooth start while ensuring compliance with legal requirements.

Here Conor talks CEO Today through the essential steps when it comes to hiring your first employee…

1. Sounding it out

Before you dive in at the deep end and over-commit yourself, give yourself the opportunity to think about and define your needs. Do you need full-time or part-time staff? Can you afford to take staff on? Is the workplace accessible for employees? Do you know your responsibilities when it comes to tax, pay and pensions?

Take the time to self-reflect, too. Are you ready for the challenge of managing someone? Can you delegate without turning dictatorial? If you’re sure you’re ready and you know what your obligations are, then you can get started.

2. Registering as an employer

To make sure you’re able to pay your staff, you’ll need to register as an employer with HMRC. This can be done up to four weeks before an employment contract comes into effect (i.e., four weeks before your employee’s first day at work). Depending on the size of your business, the way you register with HMRC differs.

You’ll also need to get employers’ liability insurance as soon as you become an employer to cover any workplace incidents (though we’ll keep our fingers crossed that you have none). Insurance must cover you for at least £5m and come from an authorised insurer. This is a legal requirement, and you can rack up a hefty fine for failing to hold insurance or for failing to display your insurance certificate.

3. Producing a job description

Writing your job description is a necessary step and depending on the business you run and the type of work that needs to be done, the roles, responsibilities and personnel requirements will vary.

Knowing what the current scope of work would be and having an idea of how the role may develop could prove useful in helping to shape the beginnings of the job description. The description should encompass all the key information, including roles and responsibilities, requisite skills and any appropriate experience. Putting these details to paper is also a great exercise to sense check what your true business needs are.

Once you’ve defined the role, you can start thinking about how to advertise your vacancy. Ideally, you’ll want to advertise the job on multiple channels to reach the greatest audience possible. Think about advertising in your local newspaper, at the local job centre, and posting about the position on your website or social media channels.

Make sure your advert is clear in what you’re asking the applicants for – a simple CV, or would you benefit from a cover letter as well?

4. The recruitment process

Once you’ve attracted some applicants for the position, you can start thinking about inviting the most suitable individuals to interview. Try to have a standardised set of questions you ask all candidates to firstly make sure you get all the information you need in the moment, and secondly to give everyone even ground to be compared on. A good starter for 10 is to cover off past experience, what attracted them to the role, and what their salary expectations are.

You’ll need to make sure your preferred candidates are eligible to work in the UK. If it’s relevant for the position, consider whether they need a DBS check.

When it comes to interview, it’s usually a good practise (though it may not be possible, particularly if you run your business independently rather than alongside a partner) to have a second person with you. Having a second opinion from a trusted aide can help to provide perspective when it comes to deciding on who to offer the job to.

5. Payroll and pension

According to the FSB, an annual salary of £25,000 can actually cost employers something closer to £33,000. This is because employers must account for, amongst other things, National Insurance contributions.

Knowing the true cost of employment is important, and it can be broken down into a handful of different components: salary, tax and pension. Paying a salary is, of course, the most important part of the quid pro quo arrangement when it comes to hiring staff. Make sure that you adhere to the most up-to-date minimum wage requirements; this is a legal obligation.

Auto-enrolment for pension is fairly clear-cut: you must enrol and make employer’s contributions for all staff aged over 22, but under the State Pension age, earn more than £10,000 per year and work in the UK.

These are the most important aspects of employing someone, so make sure you adhere to the rules. You can find out more about minimum wage here, and pension requirements here.

6. Onboarding

Ticked the admin boxes and found someone who’ll be a real asset to your business? Time to think about ‘onboarding’.

Onboarding refers to the process of getting people up to speed with the business – key information, key contacts; a sort of crash course in the important things. Getting onboarding right can make the difference between your new start flying or stumbling in the early stages of their new position.

Make sure you provide your new employee with their written statement of employment if they’re with you for more than one month. This document is effectively a pre-contract agreement which details the conditions of employment, as well as key information. You can find a list of all the essential bits of information on the gov.uk website.

Once your new starter is in the door, get them up to speed with all the important policies, including sick leave, annual leave, core hours, health and safety information, and anything else that you can think of which is important or applies to their day-to-day role.

Take the time to cover off the non-work-related things too – where can they get lunch? Are there any local attractions near your place of work? Remember, the first week in a new place can be an overwhelming time, so take it steady and allow time for you to get to know each other.

Hiring your first employee is an exciting time. But remember, it can’t be rushed, and it can take some time to find the perfect person for the role and the business. Whoever you hire, it’s important that you’re confident in their ability and attitude to get the job done. So, follow these steps, take your time and you’re bound to find the perfect person.