Carter Clear

Guide to Hiring Your First Employee


December 3, 2023

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When it comes to hiring your first employee, following proper procedures and ensuring compliance is crucial. Not only does this help you avoid legal issues, but it also sets the stage for a smooth and successful hiring process. In this guide, we will walk you through the key considerations and steps involved in hiring your first employee, while highlighting the benefits of legal compliance.

What do you need to consider as a small business owner?

Deciding to hire an employee is an important step for any small business. Before you begin the recruitment process, it’s essential to determine the type of employee you need, whether it’s a full-time, part-time, or temporary worker. Once you have a clear understanding of your hiring needs, you can start the recruitment process and carefully select the right candidate for the job.

You will need to register for PAYE (Pay As You Earn) and set up a payroll management system to handle your employee’s salary, tax, and National Insurance contributions.

Understanding employment costs

As an employer, it’s vital to be aware of the costs associated with hiring an employee. This includes mandatory minimum wage rates based on the age of the employee, as well as additional costs such as pension contributions, employers national insurance and employer’s liability insurance. Understanding these costs will help you budget effectively and ensure compliance with employment regulations.

Compliance with Right to Work Regulations

Verifying the right to work status of your employees is a crucial step in the hiring process. It is your responsibility as an employer to check and retain copies of the necessary documents, ensuring that you are not employing someone illegally. Failure to comply with these regulations can result in severe penalties, so it’s essential to take this step seriously.

Importance of proper hiring procedures

Proper hiring procedures go beyond legal compliance—they also contribute to a fair and positive working environment for both you and your employee. By ensuring fair wages, avoiding underpayment, meeting insurance requirements, and maintaining accurate records, you create a strong foundation for a successful employer-employee relationship.

Building a strong employer-employee relationship

Following proper hiring procedures and compliance not only benefits you legally—it also sets the stage for a positive working environment. By investing time and effort into hiring properly, you can build trust and loyalty with your employees, leading to increased productivity, employee satisfaction, and overall business success.

Payroll for new employers

Managing payroll and staying compliant with employment regulations can be complex and time-consuming. That’s where our payroll services come in. We offer seamless support in managing payroll and meeting compliance requirements, allowing you to focus on running your business. With our expertise and integrated cloud accounting solutions, we can help level the playing field with larger competitors.

New employee checklist

  1. Draft and send offer letter and contract:

    • Create and send a detailed offer letter, covering job title, salary, start date, work schedule and job description.
    • Once accepted you will need to ensure the employee has a Contract of Employment.
  2. Perform a Right to Work check:

    • Conduct a Right to Work check after the candidate accepts the offer and provides written consent.
  3. Gather all relevant employment forms:

    • Collect necessary forms, including those required by HMRC (a P45 or a New Starter Form, and any additional forms related to identity or personal preferences.
  4. Send a welcome email:

    • Compose and send a personalised welcome email containing vital information such as start date reminders, dress code, arrival instructions, parking details, and a schedule for the first day.
  5. Ensure technology or equipment is in place and working properly:

    • Does your new employee need IT equipment or safety boots, unform? Ensure you have these in place on plan them for the employees first day.
  6. Hold a one-on-one meeting:

    • Schedule and conduct a one-on-one meeting on the first day to welcome the new employee, explain responsibilities, and discuss key company policies.
  7. Create an employee’s welcome package:

    • Prepare a welcome package, including a welcome letter from yourself, company merchandise, office supplies, an employee handbook, and a schedule for the first days on the job.
  8. Notify current employees:

    • Inform current team members about the new hire a few days before their arrival, encouraging introductions and potentially organising a group lunch.
  9. Conduct role-specific training:

    • Provide training to ensure the new employee understands job requirements and responsibilities, including on-the-job training and supervision.
  10. Check-in after a few days:

    • Reach out to the new employee a few weeks into their employment to gauge adaptation, address concerns, and offer additional support if needed.
  11. Give them a tour of the workplace:

    • Welcome the new employee by offering a tour of the workplace, explaining any policies, dress codes, and work schedules.
  12. Explain team projects:

    • Provide an overview of current team projects, helping the new hire quickly catch up and offering assistance with any challenging tasks.


Use this checklist to ensure a hands-on and personalised onboarding process for your new employee as a small business owner.

By following this guide, you can confidently navigate the process of hiring your first (or second, or third!) employee.

Ensuring legal compliance and building a strong employer-employee relationship are crucial for your business’s success.

Remember, our payroll services are available to provide seamless support in managing payroll and meeting compliance requirements.

Contact us today and let us help you simplify your payroll processes and ensure compliance every step of the way.

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