By Daniel Hunter

Taking on your first employees is a significant milestone for any growing business, but some businesses can see this as a daunting experience, where mistakes could lead to costly tribunal claims.

Joanne Eccles, business advisor at the Forum of Private Business explains the key obligations small business owners need to consider to when making the move from a one-man band to a responsible employer.

"Many new employers do fall victim to the fear that can come when taking on an employee, even if they know it will be a key part of their growth plans," he said.

"Part of the problem is that many are unsure about their obligations as an employer before even thinking about the interview process. The problem is especially the case for small businesses that do not have the luxury of their own HR staff.

"Nobody wants to think that what you thought was the perfect hire could result in a costly tribunal case but with 1 in 6 disputes do at an average cost of £9,000. Add to this the solicitors fees and the time taken out you business and you are looking at nearer £20,000 in costs which could be crippling for a small business.

"But before the fear of fines and tribunal cases make you think again, Jo explains that by making sure that you are fully aware of your employer obligations is a key first step to building your team with confidence.

“As an employer you need to ensure you are up to speed with the basic rights of your employees. These cover the following 3 key areas: Pay and hours, Discrimination and Disciplinary and dismissal.”

Employees have the following basic rights that you must observe.
Failure to do so can result in grounds for a tribunal:

Pay and hours

• Your employees have the right to be paid the national minimum wage and equally to members of the opposite sex doing the same work of equal value
• Rest breaks and paid holiday must be in line with the Working Time Regulations
• Statutory sick pay and redundancy pay
• Protection from any unauthorised deductions in pay
• Employees are entitled Maternity, paternity and adoption leave and pay , paid leave for antenatal care, unpaid dependants’ leave, unpaid parental leave (after one year) and the right to request flexible working.
• Time off for public duties including jury service.


• Employees must not be discriminated against unlawfully on the grounds of race, sex, marriage, pregnancy, disability, gender reassignment, sexual orientation, age, religion or belief.
• Protection against less favourable treatment for part-time workers, those that ‘whistle blow’ and Trade Union members.

Disciplinary and dismissal

• All employees have the right not to be unfairly dismissed, after a qualifying period of two years.
• Employees have the right to access to fair grievance, disciplinary and disciplinary procedures, and the right to be accompanied at diciplianry and grievance procedure hearings.

All employees also have the right to receive a written statement of terms and conditions of employment (such as a contract) within two months or starting. This can avoid one the main causes of employment tribunal claims.

Eccles, continues: “Tribunals and investigations may never happen to you, but by seeking advice from organisations like the Forum to ensure you are up to speed with your obligations as an employer, can help you avoid any nasty surprises later.”

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