PEO/Employer Of record in the United Kingdom

Hire staff in the United Kingdom while we manage all employment and HR operations. No local company is needed! 

PEO/Employer of Record in the UK - Hire Employees Compliantly

We are a Professional Employer Organization (PEO) that provides Employer of Record services in the United Kingdom, also known as “employment solutions” or “PEO solutions”.

Many companies opt to outsource their employment to minimize costs and legal risk when expanding their business operations in the UK.

We can help foreign companies navigate through British employment laws and requirements, saving you time so you can focus on core business activities.

While all employment, HR, administrative and legal matters are outsourced to us, you are able to have a physical presence in the United Kingdom without the need to set-up a legal entity.

Entity Not Required

Foreign clients do not need to register a legal entity in the United Kingdom when using PEO services.

100% compliant

We strictly follow official compliance guidelines to ensure a safe legal environment for all clients.

Fast Market Entry

We will help you to hire and onboard employees within one week.

Complete PEO package for efficient and compliant employment

On-board staff in the United Kingdom without any risks

Employment and payroll regulations in the United Kingdom

Table of Contents

Employment contracts

An employment contract can be a “written statement of particulars,” which is for employees with contracts that last a month or more. This statement will include the main conditions of employment.

Working Hours

An employee should work 48 hours a week to be considered a full-time employee. However, the average working week in the UK is between 35 and 40 hours. Employees may work longer hours a day, but the workday may not exceed 11 hours a day. Overtime can be paid through overtime payment but could also be paid in time off.

Annual Leave

A worker is legally entitled to 5.6 weeks paid holiday per year and can include bank holidays as part of statutory annual leave.

Public Holidays

  • New Year’s Day: 1 January
  • Good Friday: 30 March
  • Easter Monday: 2 April
  • Early May Bank Holiday: 7 May
  • Spring Bank Holiday: 28 May
  • Summer Bank Holiday: 27 August
  • Christmas Day: 25 December
  • Boxing Day: 26 December

Probation period 

Probation periods are common in the UK and typically last between three and six months. The main feature of the probationary period is that the employee will not normally be entitled to claim unfair dismissal if the employment is terminated as the employee requires two years’ service to bring such a claim.

Termination and severance pay

There are four different types of dismissal in the UK: fair dismissal, unfair dismissal, constructive dismissal, and wrongful dismissal.

  • Fair dismissals: must have a valid reason for dismissing the employee which includes: capability, conduct, and redundancy
  • Unfair dismissals: includes an inaccurate reason for dismissal, unfair reason, failing to give warning about the dismissal, and discrimination
  • Constructive dismissal: an employee resigns because an employer breached the employment contract. This could be a single serious event or a series of less serious events
  • Wrongful dismissal: An employer breaks the terms of an employee’s contract in the dismissal process, such as dismissing someone without giving them proper notice

There is no statutory severance pay requirement in the event of non-economic dismissals.

Social security

Unless exempted by a reciprocal agreement or under the EEA rules, Class 1 National Insurance Contributions are payable by both the employer and employee in respect of an employee working in the UK.

Employee Social Security Contribution Rates

Category Letter£118 to £166 a week (£512 to £719 a month)£166.01 to £962 a week (£719.01 to £4,167 a month)Over £962 a week (£4,167 a month)
A0%12%2%
B0%5.85%2%
CN/AN/AN/A
H0%12%2%
J0%2%2%
M0%12%2%
Z0%2%2%

Employer Social Security Contribution Rates

Category Letter£118 to £166 a week (£512 to £719 a month)£166.01 to £962 a week (£719.01 to £4,167 a month)Over £962 a week (£4,167 a month)
A0%13.8%13.8%
B0%13.8%13.8%
C0%13.8%13.8%
H0%0%13.8%
J0%13.8%13.8%
M0%0%13.8%
Z0%0%13.8%

Individual Income Tax 

Individual income taxes are paid annually in the UK. Most individuals in the UK pay income tax through the PAYE (Pay As You Earn System) system. An employer uses this to withhold income tax and national insurance contributions from an employee’s wages which are paid directly to HMRC (HM Revenue & Customs).

A self-assessment tax return may be required each year if an individual earned more than:

  • £1,000 from self-employment
  • £1,000 from other untaxed income, for example from tips or renting out a property

Personal Allowances

The personal allowance for 2019/20 is £12,500. This is the amount of income upon which no income tax is paid.

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