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Hire Employees in the UK- Overview

The United Kingdom (UK) is an excellent place to hire employees for growing international businesses. The UK is home to many major international corporations that have set up operations in London and elsewhere within the country. This provides a wealth of experience and expertise that can be tapped into when hiring employees.

Finally, the UK has a business-friendly regulatory environment: Low set-up costs, streamlined compliance a host of incentives and benefits make it an attractive location for ambitious enterprises.

For those interested in building a UK team, the services of an Employer of Record (EOR) can help reduce the amount of time needed to find and onboard new employees. An EOR in the United Kingdom can take care of all aspects of employment, including payroll, taxation, immigration, and benefits. This allows businesses to focus on their core operations.

Facts & Stats

Population

67.1 M (50.6 Million in the labor force)

Capital City

London

Languages Spoken

English

Currency

GBP (£)

GDP per capita

$2.708 trillion

Ease of Doing Business

8th in the world

Minimum Wage

£1,544 per month (For those 23+, 37.5 hr week) (2022)

Average Wage

£1,544 per month (For those 23+, 37.5 hr week) (2022)

Paid Leave

28 days including bank holidays

United Kindom: Business Environment

Business outlook

The UK economy has had reduced growth compared to prior years. The OECD revised previous predictions for GDP growth in 2023, forecasting GDP growth at 0.0%, down from the 2.1% they previously forecasted. However, this represents a regional trend — 2023 forecasts for Germany, Italy, Canada, and the US are also down from previous forecasts.

This slowdown is attributable to a number of factors, including the end of the Brexit transition period, the conflict in Ukraine, global supply-chain disruptions, higher interest rates and inflation, and slower growth in the global economy.

Despite these challenges, the outlook for the UK economy is expected to remain one of the strongest in the developed world. With strong fundamentals and a diversified economy, the UK is well-positioned to weather the storm and return to sustained growth in the longer term.

Business regulation

The United Kingdom has a complex system of labor laws that regulate everything from minimum wage and working hours to holiday pay and redundancy rights. These laws are designed to protect workers’ rights and ensure that they are treated fairly by their employers.

The Employment Rights Act 1996 is the main piece of legislation that governs employment rights in the UK. This Act sets out the minimum rights that workers are entitled to, including the right to maternity leave, the right to paid annual leave, and the right to receive a written statement of terms and conditions of employment. The Act also gives employees the right to challenge their dismissal from employment.

The Equality Act 2010 is another important piece of legislation when it comes to labor rights in the UK. The Act prohibits discrimination on the basis of certain protected characteristics, including age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex, and sexual orientation. Employers must not discriminate against employees on any of these grounds when it comes to aspects of their employment such as pay, promotion, or terms and conditions of employment.

The Working Time Regulations 1998 lay down minimum standards for workers’ hours and rest breaks. Under these Regulations, workers are entitled to a maximum weekly working time of 48 hours; a limit on night work; 11 hours’ rest break between working days; 20 minutes’ rest break if the worker’s daily working time is more than six hours; and 24 hours’ rest break in every seven-day period. Workers are also entitled to paid annual leave of 5.6 weeks per year. These entitlements can be varied by agreement between the employer and employee.

Business culture

The United Kingdom has a long history of commerce and industry, and this is reflected in the country’s business culture. UK businesses are typically hierarchical, with clear lines of authority and responsibility, albeit less so than some mainland European countries like Germany.

However, there is a growing trend towards more egalitarian structures, particularly in smaller businesses. Discipline and punctuality are highly valued, and employees are expected to communicate politely and respectfully with colleagues and customers.

Overall, the United Kingdom’s business culture is disciplined and professional, with a strong focus on quality and customer service

Recruiting employees in the UK

Recruiting employees in the UK – Overview

The most common way of finding candidates for your vacancy in the UK is by advertising your role on popular job boards such as Monster, Reed or CV Library. This will ensure that your vacancy is seen by a large number of potential candidates and also allows you to search for candidates based on their skills, experience and location.

Social media is also a great way to find candidates for your vacancy. LinkedIn is particularly popular among professionals in the UK. Facebook and Twitter can also be used to advertise your vacancy to potential candidates.

To make things even easier, you can hire a global PEO such as Horizons to work with you and identify the ideal candidate for the job.

Most important recruitment tools in the UK

LinkedIn
LinkedIn is a fantastic resource for recruiting in the UK, offering access to a vast network of professionals. You can use LinkedIn to search for potential candidates, view their profiles and contact them directly if you think they could be suitable for your vacancy.

Indeed
https://uk.indeed.com/
Indeed is one of the most popular job boards in the UK, offering a simple way to search for candidates based on their skills, experience and location. You can also post your jobs on Indeed and reach a large number of potential candidates quickly and easily.

Reed
www.reed.co.uk
Reed is one of the leading job boards in the UK. It offers access to a large database of potential candidates and allows you to post job adverts for free. You can also search for candidates by location, job title, or keyword.

Interviewing employees in the UK

Interviewing employees in the UK – Overview

In the UK, in-person interviews are the most common type of interview. However, online interviews have become more widely utilised since the pandemic. One-on-one interviews are most common, but panel interviews are not unheard of. Most candidates will expect a typical formal interview situation with a business dress code.

Can I ask the candidate’s previous salary in the UK?

Employers in the United Kingdom may ask about a candidate’s current or previous salary during the hiring process. However, the candidate is not obliged to answer the question.

What is the typical salary increase at a new job in the UK?

The typical salary increase in the UK when changing jobs is approximately 10%.

Onboarding employees in the UK

Onboarding employees in the UK – Overview

The onboarding process for new employees in the UK can vary depending on the company. However, there are some common elements that are typically part of the process. For example, most companies will provide new employees with an orientation to introduce them to the company culture and expectations. In addition, new employees will usually be given a tour of the facilities and introduced to their fellow employees. The onboarding process also usually includes training on company policies and procedures.

Best remote working tools to use in the UK

Most standard remote working tools are used frequently in the United Kingdom. One of the most popular is Microsoft Teams. Other popular options include Zoom, Slack, Jira, and Google Drive. Whatever remote communication systems your business currently uses, your UK employees should be able to adopt these easily.

Holiday season in the UK — 2023

Holiday Schedule in the UK [2023]

National public holidays in the UK in 2023 include:

Date	Holiday name
1 Jan., 2023	New Year’s Day
2 Jan., 2023	New Year’s Day observed
7 April., 2023	Good Friday
1 May., 2023	Early May Bank Holiday
8 May., 2023	Bank Holiday for Coronation of King Charles III
29 May, 2023	Spring Bank Holiday
25 Dec, 2023	Christmas Day
26 Dec, 2023	Boxing Day

What is the typical salary increase employees in the UK expect?

In the United Kingdom, there is no standard annual salary increase, and the amount of the salary increase will depend on a variety of factors, including the company’s budget and what is offered by comparable companies.

However, employees typically expect an annual salary increase in line with cost of living increases, plus performance-related increases where applicable. This is often approximately 2-3% each year, with high-performing employees receiving an additional 1-8% as a performance-related pay increase.

FAQs

Should I hire freelancers or employees in the UK?

Whether you hire freelancers or employees in the United Kingdom essentially comes down to your specific requirements: Freelancers/self-employed, may be an attractive prospect for some job roles and businesses, as there are fewer employment rules and regulations to follow. However, there are still some essential legal considerations, and it’s important to set up your contracts with the correct terms and conditions or you could find that you don’t receive the services you expected, or even risk having trade secrets divulged.

Hiring employees can be much more straightforward, especially when you work with a global Employer of Record like Horizons. We have an expert understanding of UK Employment Law, and can help you hire employees in the United Kingdom quickly and cost-effectively.

Can I hire foreigners in the UK?

Yes, you can hire foreigners in the United Kingdom. There are a number of visa routes that allow foreign nationals to come to the UK to work, including the Tier 2 General Visa and the Tier 5 Youth Mobility Scheme Visa. However, there are some restrictions on who can apply for these visas, so it is important to check the requirements before applying. In general, they will need to have a job offer from a certified sponsor and meet the minimum salary requirements.

How do I open a UK subsidiary?

The procedure for establishing a UK subsidiary can take as little as a few hours to several weeks, depending on the complexity of your business. You’ll need to submit an application form and several important documents to Companies House, including Articles of Association, Company Charter, and a full set of accounts -among other documentation. All documents need to be notarized by a lawyer, and if they are in a language other than English, they will need to be translated into English by a certified translator.

After the UK subsidiary is set up, it will be required to give yearly accounts to Companies House and may have to go through an annual audit. The amount of times the company is audited usually depends on the size and profile of the overseas company. The subsidiary will also have to sign up for corporation tax and possibly VAT (Value Added Tax) and UK payroll tax.

In most cases, the fastest and safest way (from a compliance perspective) to get operations started in the UK is to hire your first few employees with a global EOR like Horizons.

Hiring in the UK, Made Easy

Your business can easily hire employees in the UK without opening a local entity. We handle local employment law, complex tax regulations, and international payroll in 180+ countries worldwide. All you need to do is focus on your business.

Success stories from businesses we’ve helped enter and grow in new markets.

Client Testimonials

"As a seed-stage, London-based startup, we were initially hesitant to expand internationally due to the administrative workload involved. Horizons took the headache out of the process, allowing us to hire a team of software engineers in Germany."

Gabor SzedlakCo-founder & COO at MindLabs (UK)

"I truly appreciated the thoroughness and the professionalism of Horizons personnel while we hired internationally with them. They were knowledgable on all subject matters pertaining to international employment."

Gary PaskyVP Software Development, PICS ITech (USA)

"On deciding to begin commercial activities in Asia Pacific, we needed a provider to handle the employment and remuneration of our workforce. With Horizons the result was fast, efficient, and fit-for-purpose. We recommend Horizons as an EOR provider.”

Chris MorrellManaging Director, Schaeffler Group (Germany)

"The collaboration with the Horizons team is excellent. Both our local employee as well as our HQ in Germany are more than pleased with the support provided and the simplicity of the service. We can highly recommend the Horizons solution to anyone."

Christoph EngelbertCo-Founder & CTO, Clevabit (Germany)

"We needed an EOR that could provide expert support for payroll in APAC. We are pleased with Horizons’ expertise and the fact that they are flexible, responsive, and easily accessible from Belgium. They were able to provide services within the short timeline we required."

Katia FlamandHuman Resources, Devian Chemicals (Belgium)