4 tips for Microbusinesses who need to take on staff

Today is #microbizmattersday, a day to celebrate those who run their own businesses and employ 0-9 staff. It’s a fast growing sector and we may well see it continue to grow in the coming years.

Taking on staff can be a major issue for micro-businesses – as one report put it the owner moves from delivering their product or service to being an unpaid tax-collector and employment expert. And the sort of staffing issue that most HR professionals would take in their stride can become a serious problem, threatening the existence of the business itself. I’ve recently worked with two microbusinesses, both of whom had to handle the situation of a single disruptive employee. In both cases the situation had been exacerbated by a lack of knowledge by the business owner (primarily by failing to tackle the issues soon enough rather than by over regulatory management). And it’s certainly true that many of the microbusiness owners I work with want to be “good” employers.

It doesn’t have to be difficult to take on staff, but if you are planning to do so remember these 4 key points:

  • Get Employer’s Liability Insurance – this is a legal requirement and covers you if a member of staff has an accident or injury at work. It will normally even cover you if an individual makes a claim many years later, for example if they develop an illness which may have been the result of working for you
  • Pay people correctly – your accountant will normally operate a payroll service (or be able to recommend one) which will make sure tax and national insurance are correctly deducted and, just as importantly, paid over to HMRC. The cost of doing this is well worth the time saved trying to get your head round tax codes, allowances etc!
  • Get your health and safety right. Unless you work in a particularly hazardous environment, where you should already be aware of the risks of certain machinery or chemicals, it’s mostly common sense (keeping work areas tidy, reporting accidents etc) – although you’ll also need to start doing things like having electrical equipment (kettles, pcs, copiers etc) tested on a regular basis
  • Get your basic paperwork right. An employment contract doesn’t have to be a long winded or legalistic document, but you must give an employee a written statement.

The cost of taking advice and doing things properly far outweighs the cost of “getting it wrong” – so factor the cost of professional support in to your decision about whether you can take someone on.

If you’re a microbusiness owner, you may also find these two older posts of mine useful – One Bad Apple and Back to Basics. And if you want to know more, my book covers many of the key things a business owner needs to know. You can download it here. (I should point out that as it was published in 2012, some – but not all – of the detailed employment law has changed, although the basic principles and guidance haven’t)

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