Hiring your first employee is a big step. It's the moment a business stops being just you. It also comes with legal duties that are easy to miss if you've never done it before.

Here's a straightforward checklist of what you need to do, in the order you'll need to do it.

Before you advertise

1. Work out what you can afford

The salary isn't the only cost. As a rough guide, budget for:

  • Salary. At least the National Living Wage, which is £12.71 an hour from April 2026 for anyone aged 21 and over.
  • Employer National Insurance. 15% on earnings above £5,000 a year. Many small businesses can claim the Employment Allowance, which reduces your employer NI bill by up to £10,500 a year, so for your first hire you may pay little or none.
  • Workplace pension. At least 3% of qualifying earnings for eligible staff.
  • Holiday. Full-time staff are entitled to 5.6 weeks of paid holiday a year, including bank holidays.

2. Be clear about the role

Write down what the person will actually do each week, the hours, and what "good" looks like after three months. This makes your advert better and your interviews easier.

Before they start

3. Check their right to work

You must check that your new employee has the right to work in the UK before they start. Keep a copy of the documents you checked. The penalty for getting this wrong can be up to £60,000 per worker.

4. Get employers' liability insurance

This is a legal requirement as soon as you employ someone. Policies must provide at least £5 million of cover, and you can be fined for every day you don't have it. Many business insurance packages include it.

5. Register as an employer with HMRC

You need to register for PAYE before your employee's first payday. It can take up to two weeks, so do it as soon as you've agreed a start date. You'll then run payroll each month, either with payroll software or through your accountant.

6. Prepare a written statement of terms

Every employee must receive a written statement of their main terms on or before their first day. It covers pay, hours, holiday, notice periods, job title and place of work. Most people use this as the basis of their employment contract.

In the first weeks

7. Set up their workplace pension

If your employee is aged 22 or over and earns above the auto-enrolment threshold, you must enrol them in a workplace pension within six weeks of their start date. Several government-backed providers make this simple.

8. Plan a proper induction

The first few weeks decide whether someone stays. Give your new starter a clear plan for their first month, one person to go to with questions, and regular check-ins. Early leavers are expensive, especially when you've only just started hiring.

Quick checklist

  • Budget for salary, employer NI, pension and holiday.
  • Write a clear job description.
  • Check right to work before day one.
  • Get employers' liability insurance.
  • Register for PAYE before the first payday.
  • Give a written statement of terms by day one.
  • Enrol them in a pension within six weeks.
  • Plan their first month.

This is a general guide rather than legal or tax advice, so check anything you're unsure about with your accountant or GOV.UK.

Need help finding the right person?

At Bridge Gap Recruitment, I help small businesses across Oxfordshire, Buckinghamshire and the Thames Valley hire office, admin, customer service and sales staff. We screen every candidate, including their right to work, before you meet them.

Our fee is a flat 10% of the first year's salary, paid only once your new starter begins. Tell us about the role and I'll come back to you personally.