It’s never a bad sign to be busy, but if you suddenly find you’ve got too much work on your hands then it can end up causing problems. In this article we assess three different ways to bring an employee on board; full-time employee, apprenticeship and sub-contractor.
Take on a full time employee
When things get busy, many firms look to hire a full-time employee to make things easier. This is a tried and tested approach, with a number of benefits. A long-term, full-time employee can help you take your business to the next level. Full-time employees can also help to improve rates of productivity and consistency. As most people can only work one full-time job, most full-time employees have a stronger level of employee loyalty than part-time counterparts.
Taking on a full-time employee for the first time is a straightforward process. With that said, there are seven key things to remember:
- Set a wage, which must be higher than the National Minimum Wage
- Ensure the person has a legal right to work in the UK
- See if you need to run a DBS check (formerly a CRB check) on your new employee
- Take out employer’s liability insurance
- Create a written employment statement and send it to employee
- Register as an employer with HM Revenue and Customs (HMRC)
- Check if staff are required to sign up to a workplace pension scheme
- Bringing a full-time employee on-board is a simple, but significant process. By hiring a full-time employee you’re agreeing to pay for holiday time and might have to contribute to a workplace pension scheme. It’s also more difficult to terminate full-time contracts should a problem occur. As a result, it’s really important to recruit the right candidate and find someone who fits in with your current operations.
Sub-contract it out
From time to time, you will be working on a project that requires an additional pair of hands but might not be in a position to make a full-time hire. If this is the case, it’s best to sub-contract work out to another contractor.
Outsourcing work out can be a lot more cost-effective than making a full-time hire. Not only will you avoid having to pay employment insurance, but also social benefits and union fees. By subcontracting to an expert you’ll often get a higher level of work.
Draw up a contract
In general, sub-contracting requires less paperwork than making a full-time hire, but it’s still worthwhile pulling together a contract, to avoid any problems further down the line. A simple agreement may cover:
• The specific work the contractor is expected to do
• The time period the contractor has to complete the work
• The amount of money the contractor will be paid
Be clear about payment terms
In terms of payments – different terms can be negotiated:
• Agreed instalments e.g. every two weeks
• Staged payments, when different tasks are completed or/
• A lump sum on completion
Whatever you decide, as subcontractors are defined as separate entities they are expected to pay their own self-employment taxes. However, beware – if a worker who has been contracted is found to have not paid their fair share in tax and NICs, the contractor who subcontracts is liable for any outstanding debt. The GOV.UK website has a great guide, which details the full responsibilities of contractors subcontracting work.
Think about liability
It’s also important to include more specific clauses in the contract relating to insurance and indemnity and check that they have their own public liability insurance. Also check your own insurances to understand any implications of sub-contracting your work.
Take legal advice
If you’re working on a large project, it might be useful to bring a solicitor on-board to draft the proposed subcontractor agreement. There are also a number of subcontracting template contracts available to purchase online. Getting the agreement right helps to protect you against any nasty surprises further down the line. Bringing in a sub-contractor, especially one you don’t know, can be risky so it’s really important to be legally protected.
Hire an apprentice
The third option is to bring an apprentice on-board. In recent years, the UK government has pumped a lot of money into apprenticeships. As a result, the standard of apprenticeships is higher than ever before. It’s also easier than it’s ever been to find a suitable candidate, with the government’s new apprentice matcher service helping firms find apprentices suited for their work. Hiring an apprentice is also relatively straightforward, earlier this year, we put together a guide detailing the process.
There are a number of benefits associated with bringing an apprentice on-board. For one, it’s an extremely cost-effective form of staffing. The costs associated with hiring an apprentice are very low, with some apprenticeships fully-funded by the government. Whilst costs are low, the impact is big, with studies showing 80% of businesses see a productivity boost after hiring an apprentice. There’s also minimal paperwork involved, which means apprentices can come onto site with little delay.