An HR checklist for new UK employers
Reviewed by Mellow Editorial Team, HR & payroll content team
Before you hire your first employee, you need to register as an employer with HMRC, set up payroll, and meet a set of legal obligations that apply from day one. Miss any of them and you face penalties, backdated liability, or both.
Register as an employer before you pay anyone
You must register with HMRC as an employer before your first payday — and at least two weeks before, if possible. Registration gives you a PAYE reference number, which you need to run payroll and report to HMRC.
If you are a limited company, you will also need to register for Corporation Tax separately. Sole traders and partnerships follow a different path but still need PAYE registration before employing anyone.
Set up a compliant payroll process
UK payroll is not optional admin — it is a legal requirement. Under Real Time Information (RTI), you must submit a Full Payment Submission (FPS) to HMRC on or before each payday, every time. Late or missing submissions trigger automatic penalties.
Your payroll must calculate:
- Income tax using each employee's tax code, applied against the personal allowance of £12,570. Basic rate is 20%, higher rate 40%, additional rate 45%.
- Employee National Insurance at 8% up to the upper earnings limit, then 2% above it.
- Employer National Insurance at 13.8% on earnings above the secondary threshold.
You will also need to issue a P60 to every employee by 31 May after each tax year, and submit a P11D for any taxable benefits in kind by 6 July.
If you use payroll software, make sure it is HMRC-recognised. If you outsource, make sure the provider submits on time — the legal responsibility stays with you.
Carry out right to work checks
Before an employee starts work, you must check they have the legal right to work in the UK. This is a legal requirement under the Immigration, Asylum and Nationality Act 2006, and doing it correctly gives you a statutory excuse if a problem surfaces later.
For British and Irish nationals, that typically means checking a passport or birth certificate plus proof of National Insurance number. For nationals of other countries, the process depends on their visa or immigration status — some require an online share code check via the Home Office portal.
Keep copies of the documents you check, and record the date you carried out the check. Do not rely on memory or informal confirmation.
Enrol eligible employees into a pension scheme
Auto-enrolment applies from the employee's first day of work if they meet the eligibility criteria — broadly, workers aged 22 to state pension age earning above the earnings trigger. You do not get a grace period because you are a new employer.
You need to:
1. Choose a qualifying workplace pension scheme and register with The Pensions Regulator.
2. Enrol eligible employees automatically.
3. Contribute at least 3% of qualifying earnings as the employer; employees contribute at least 5%.
4. Complete your declaration of compliance with The Pensions Regulator within five months of your staging or duties start date.
Workers who are not automatically enrolled may have the right to opt in, and you must handle those requests correctly.
Issue a written statement of employment particulars
Every employee is entitled to a written statement of their main terms and conditions — known as a Section 1 statement — from day one of employment. This is not something you can defer until they have passed probation.
The statement must cover pay, working hours, holiday entitlement, notice periods, job title and location, among other things. Statutory annual leave is 5.6 weeks (28 days including bank holidays for a standard five-day week), and that figure must be reflected accurately.
Under the Employment Rights Act 2025, day-one rights have been strengthened further, so contracts and policies that were adequate a few years ago may need updating.
Keep your statutory obligations in view from day one
A few further obligations to build into your processes from the start:
- Statutory Sick Pay must be paid to eligible employees who are off sick for four or more consecutive days, including non-working days.
- Family leave pay — statutory maternity, paternity, adoption and shared parental pay — applies once employees meet the relevant qualifying conditions.
- Employers' liability insurance is a legal requirement as soon as you employ anyone. You must display or make available the certificate.
- Health and safety law applies from the moment you have staff, including a written health and safety policy if you employ five or more people.
Running payroll across multiple employees, or across more than one country, adds complexity quickly. How Mellow runs payroll across six countries on one platform explains how consolidated reporting can reduce that administrative load.
Getting these foundations right at the start is considerably cheaper than fixing them under pressure from HMRC or an employment tribunal later.
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