The Complete HR Guide for SMEs: Ensuring Legal Compliance and HR Best Practices

Introduction

Running a small or medium-sized enterprise (SME) in the UK comes with many responsibilities, and one of the most critical areas is Human Resources (HR). Managing employees effectively while staying compliant with UK employment laws is crucial to avoiding costly legal issues and ensuring a productive workforce. This guide will walk you through the key HR areas you need to focus on and the steps to ensure compliance with ACAS best practices and UK employment law.

Why HR Matters

Why HR Matters for SMEs: Cost Savings and Legal Protection

Small and medium-sized enterprises (SMEs) often overlook the importance of structured Human Resources (HR) practices, assuming these are concerns only for larger corporations with dedicated HR departments. However, regardless of size, every business must comply with employment laws to avoid legal risks that can lead to significant costs and disruptions.

How do I know if I am legally compliant

For many businesses within the UK whilst they are trying to do the right thing by their employees and the business the reality is very different as they are failing to comply with UK employment legislation. 

Unfortunately, ignorance is no defence in law and simply not knowing about the correct process or legal requirements can result in hefty tribunal awards. The best way to ensure you are complying with your legal requirements as an employer is to undertake a HR audit  

HR Audit

Regular HR audits help SMEs stay compliant and avoid potential legal issues. Key areas to review include:

• Recruitment and onboarding processes
• Contracts and employment documents
• Policies and handbooks
• Training and development programs
• Performance management procedures
• Employee relations management
• Compliance with GDPR and record-keeping

Find out for FREE if your business is complying with UK employment Legislation.

Book a FREE HR audit today https://keyhr.co.uk/free-hr-audit/

HR Management Options for Small Businesses

Handling HR In-House

Some small businesses prefer to manage HR tasks themselves using templates and advice freely available online. This do-it-yourself method can appear cost-effective at first, as it avoids upfront consultancy fees.
However, the true cost often becomes clear over time. Managing HR internally can be time-consuming and legally risky. Without expert input, businesses may unknowingly expose themselves to costly compliance issues or employee disputes.

Using an Outsourced HR Provider

Working with an external HR partner can significantly reduce these risks. Employment law is complex and constantly evolving, covering everything from equality and workplace safety to minimum wage and employee rights. Without specialist knowledge, staying compliant can be a real challenge.

Outsourced HR support ensures your business remains legally protected and up to date, helping you avoid financial penalties and reputational harm. It also frees up your time, so you can focus on growing your business, knowing your HR needs are in safe hands.

HR In SME’s

Recruitment

The Hiring Process

Employees are a crucial asset to your business. Finding the right individuals for your team requires careful consideration of their skills and experience relevant to the role.

When considering hiring friends or relatives, proceed with caution. Mixing personal relationships with business can lead to challenges in enforcing professional standards and addressing issues effectively.

To ensure you hire the right person for the job, follow these steps:

Identify the Role:

Clearly define the position you need to fill within your organization.

Create a Job Description:

A job description outlines the job title, main responsibilities, reporting structure, and work environment. It serves as a vital tool for recruitment, performance evaluation, and employee management.

Develop a Person Specification:

A person specification details the essential and desirable criteria, educational qualifications, professional experience, skills, competencies, and personal attributes required for the role. It assists in shortlisting candidates and designing interview questions.

Choose the Right Advertising Platform:

Select where to advertise the role to attract suitable candidates.

Prepare Standardized Interview Questions:

Develop fair and consistent questions Standardized questions are consistent, non-discriminatory queries based on the job description and person specification. They ensure fairness in the interview process and enable unbiased assessment of candidates’ suitability.

Shortlist Applicants:

Evaluate candidates against the job requirements to identify potential matches.

Conduct Interviews:

Use the standardized questions to assess candidates’ suitability for the role.

Verify Right to Work:

Ensure all prospective employees have the legal right to work in the UK. . It’s your legal responsibility to verify that employees have the right to work in the UK before hiring them.

Failure to conduct these checks can result in significant penalties, with fines up to £60,000 per illegal employee and/or up to 5 years in prison.

 Additionally, ensure compliance with anti-discrimination laws to avoid legal repercussions, as discriminating against applicants based on protected characteristics can lead to tribunal claims.

Offer Employment:

Issue job offers and contracts to successful candidates, subject to satisfactory references.

Types of Employees

Employees

An Employee is typically someone directly employed by a company under a contract of employment. This arrangement entails regular work obligations, specified hours, and supervision by a manager or supervisor. Employees often work at the employer’s premises or a designated location, using materials and tools provided by the employer. They are subject to the employer’s disciplinary procedures and benefit from various employment rights, including the national minimum wage, holiday pay, and protection against discrimination.

Workers

A Worker, on the other hand, may have a contractual or informal agreement to perform services for a reward. While they may not be employees, they are entitled to certain rights such as the national minimum wage, protection against unlawful deductions, and statutory rest breaks. Workers may work under the supervision of another and typically cannot send someone else to do their work.

Self employed

Self-Employed individuals operate their own businesses and bear responsibility for their business outcomes, including profit and loss. They have autonomy in choosing their work schedule, methods, and may subcontract work to others. Payment for their services is often based on a fixed price rather than hourly wages, and they are not entitled to the same employment rights as workers or employees, such as statutory sick pay or maternity leave.

It’s crucial for businesses to correctly classify individuals as self-employed, workers, or employees based on these distinctions, as misclassification can lead to legal liabilities and disputes over employment rights and benefits.

Whilst you may think someone is self employed they may actually be classified as a worker or even as an employee with additional employment right. Failing to give the individual the correct rights and you could face an expensive tribunal claim

Contracts of Employment:

A contract of employment, also known as an employment agreement, is a legally binding document that establishes the terms and conditions of employment between an employer and an employee. It can be written, verbal, implied, or established through custom and practice.

Written Particulars of Employment (Written Statement of Employment)

Since April 6, 2020, UK law requires that both workers and employees must receive written particulars of employment from the beginning of their contract or employment. This document outlines crucial terms such as salary, working hours, and holiday entitlements.

Failure to supply written terms of employment prior to employment or on the first day can result in an automatic award of 4 week basic salary at tribunal

Expressed and Implied Terms

Expressed terms are those explicitly agreed upon by both parties, whether in writing or verbally. These include specifics like salary rates and working hours, providing clarity and enforceability to the employment relationship.

Implied terms, although not explicitly stated, are considered part of the contract by custom and practice, legal requirements, or necessity. For example, adherence to health and safety regulations or statutory minimum rights.

Statutory Minimum Terms

All employment contracts in the UK include statutory minimum terms imposed by law. These include rights such as the National Minimum Wage, statutory holidays, sick pay, maternity, paternity, and parental rights, protection against discrimination, and obligations related to health and safety.

Incorporation of Terms

Terms can be incorporated into contracts from various sources, such as collective agreements with trade unions, company policies, established customs and practices, or previous correspondence. These incorporated terms are as legally binding as those expressly stated in the contract.

Free contracts of employment off the internet

It may be tempting to use free contracts of employment found online as they offer initial cost savings and convenience. However, as they are not tailored to your business. The actual cost saving in the short term will vastly be outweighed by the financial losses later.

Generic contracts may lack clarity on essential statutory terms such as wages, holidays, and dismissal procedures, potentially leading to costly legal disputes and financial liabilities. Moreover, they may not be updated to reflect current laws or best practices, putting businesses at risk of non-compliance and operational disruptions.

It is always best to get contracts of employment professionally drawn up by either an employment solicitor or HR company as each contract needs to be bespoke to your business needs

Tailoring Contracts to Specific Roles

Using standard contracts for all employees may overlook crucial differences in roles and responsibilities. Tailoring contracts to each position ensures clarity on job expectations, salary, benefits, and specific legal obligations relevant to that role.

Review and Legal Compliance

Regularly reviewing and updating contracts is essential to ensure compliance with current legislation and align with the evolving needs of the business. Seeking legal advice when making significant changes or clarifying existing terms helps mitigate risks associated with employment disputes.

Consequences of Incorrect Contracts

Failing to issue correct contracts or including ambiguous terms can lead to legal disputes, financial liabilities, confusion over job roles and expectations, breaches of confidentiality or non-compete agreements, challenges in termination processes, exposure to discrimination claims, reputational damage, operational disruptions, and non-compliance with statutory requirements.

By understanding these key aspects of contracts of employment, SME employers can establish clear, fair, and legally compliant employment relationships. Regular review and adaptation to legal changes are essential to mitigate risks and ensure compliance.

Staff Handbooks

An employee handbook serves as a comprehensive guide and rulebook for your business, encompassing both statutory documents required by law and your company’s specific policies and operational practices. Having a well-designed handbook tailored to your business needs not only ensures compliance with employment laws but also helps mitigate absence levels, reduce associated costs, and minimize potential tribunal claims.

Under current UK employment legislation there is no legal obligation to issue a staff handbook to your employees. However Investing in an employee handbook can significantly benefit your business by preventing legal disputes and overpayment issues. It clarifies employee rights, responsibilities, and company expectations, thereby fostering a transparent work environment and enhancing operational efficiency.

By outlining clear policies on absenteeism and return-to-work procedures, the handbook supports effective absence management, reducing unplanned leave and providing a structured approach to handling employee absences. This proactive approach not only improves productivity but also helps control absence-related costs.

Moreover, the handbook serves as a critical tool for legal protection. It documents company policies and procedures, ensuring compliance with UK employment laws and regulations. In cases of disputes or legal claims, it can serve as evidence of fair treatment and adherence to legal standards.

Additionally, the handbook facilitates performance management and conflict resolution by setting clear behavioural expectations and providing guidance on resolving workplace issues. This structured approach helps mitigate the risk of tribunal claims and associated legal expenses.

Given the dynamic nature of employment laws, regularly reviewing and updating the handbook is crucial. This ensures that it reflects current company policies, legislative changes, and industry standards, maintaining its relevance and effectiveness in safeguarding your business interests. Aim to review and update the handbook at least annually or whenever significant policy or legal changes occur.

Managing Employees Effectively

Grievances and Performance Management

Having a clear grievance procedure is essential for ensuring that employee complaints are addressed fairly and promptly, preventing potential disputes from escalating. A structured grievance process allows employees to raise concerns in a safe environment, knowing that their issues will be taken seriously and handled appropriately.

It is equally important for employees to feel comfortable coming forward with grievances without the fear of retaliation, which can help maintain a positive workplace culture.

Maintaining transparency throughout the grievance resolution process helps ensure that outcomes are fair and equitable for all parties involved.

Absence Management

Absence management is crucial for SMEs, as employee absences can significantly impact productivity and costs. To effectively manage this, it’s essential for businesses to have a clear sickness policy in place, outlining procedures for employees to follow when reporting absences.

This policy should include specific instructions on who to notify, how to report, and any documentation required for verification. Additionally, conducting return-to-work interviews is an important step in managing absences. These interviews help identify the root causes of frequent absences, whether they are health-related, personal issues, or work-related stress, and can also offer a chance to ensure employees feel supported during their transition back to the workplace.

Monitoring absence trends over time can provide valuable insights into patterns or underlying problems, enabling businesses to take proactive measures before absences become a recurring issue. In some cases, offering flexible working arrangements may be a solution to accommodate employees who need alternative working conditions, whether due to personal circumstances or health concerns. By adopting these strategies, SMEs can better manage employee absences and create a more supportive and efficient working environment.

Disciplinary Procedures

A well-structured disciplinary policy and process are essential for SMEs to address employee misconduct in a fair and consistent manner, helping to minimise the risk of future tribunal claims. The process typically involves several key steps, beginning with a thorough investigation of the issue at hand. This step ensures that all relevant facts are gathered before any decisions are made.

Once the investigation is complete, a formal disciplinary meeting should be held, where the employee is given the opportunity to respond to the allegations. Allowing the employee to present their side is crucial to ensuring the process remains fair and transparent.

Depending on the severity of the issue, the next step may involve taking appropriate action, which could range from issuing a formal warning to dismissing the employee. In either case, it’s important to offer an appeal process, allowing the employee a chance to challenge the decision if they feel it was unjust.

Failing to follow a fair and consistent disciplinary process can leave an organisation vulnerable to claims of unfair dismissal. To avoid this, employers should ensure that managers are adequately trained in handling disciplinary procedures, enabling them to approach each situation professionally, impartially, and in accordance with established policies.

Redundancy and Termination

Handling Redundancy Correctly

Redundancy should only be considered when a role is genuinely no longer needed, and it must be handled carefully to ensure fairness and compliance with employment laws. Employers must provide a fair selection process to determine which roles are at risk of redundancy, ensuring that criteria are clear, objective, and applied consistently across the workforce.

It’s also essential to consult with affected employees, giving them the opportunity to understand the reasons behind the redundancy and express any concerns they may have. Where possible, employers should offer alternative roles within the company to help employees transition into new positions, thus potentially avoiding the need for redundancy altogether.

For employees with over two years of service, redundancy pay must be provided, as mandated by law. However, before resorting to redundancy, employers should consider alternative measures, such as job sharing or reducing working hours, which can help retain valuable employees while still achieving the necessary workforce adjustments.

Dismissing an Employee

Dismissing an employee is a significant decision that must be handled with care to avoid potential claims of unfair dismissal. There are several valid reasons for dismissal, including poor performance, misconduct, redundancy, or legal reasons, such as the loss of an employee’s right to work in the UK. In each case, it is essential that employers follow a fair and consistent process to ensure the dismissal is justified. This includes providing proper notice to the employee and documenting each step of the process to maintain transparency and prevent legal issues. Following a structured procedure helps protect the business from unfair dismissal claims and ensures that the employee is treated with respect and given a fair opportunity to address any concerns.

Employment Law Essentials

Discrimination

Understanding UK Employment Law: Equality Act 2010 and SME Responsibilities

In the United Kingdom, the Equality Act 2010 serves as a fundamental framework to protect employees from discrimination based on various protected characteristics. As an SME employer, it is crucial to understand and comply with these legal provisions to avoid legal risks and ensure a fair and inclusive workplace environment.

Protected Characteristics and Prohibited Discrimination

Under the Equality Act 2010, it is illegal to discriminate against employees based on the following protected characteristics:

• Age: Discrimination based on age, whether younger or older, is prohibited.
• Gender/gender reassignment: Employees must not be treated less favourably due to their gender identity or intention to undergo gender reassignment.
• Marriage or civil partnership: Discrimination based on marital status or civil partnership status is unlawful.
• Pregnancy and maternity: Employees must not face discrimination due to pregnancy, maternity leave, or related circumstances.
• Race (including nationality and ethnicity): Discrimination based on race, nationality, or ethnicity, including colour and national origin, is strictly prohibited.
• Religion or belief: Employees are protected from discrimination based on religious beliefs or philosophical convictions.
• Sex: Discrimination based on biological sex or gender is unlawful.
• Sexual orientation: Discrimination based on sexual orientation, including heterosexuality, homosexuality, or bisexuality, is prohibited.

Forms of Discrimination and Compliance Obligations

Discrimination can manifest in various forms, including:

• Direct discrimination: Treating someone less favourably due to a protected characteristic.
• Indirect discrimination: Applying policies or practices that disadvantage individuals with certain protected characteristics.
• Discrimination by association: Treating someone unfairly because of their association with another person who has a protected characteristic.

As an SME employer, it is imperative to ensure that all aspects of employment, including recruitment processes, terms of employment, workplace policies, and practices, are free from discrimination. This includes providing reasonable accommodations for individuals with disabilities and ensuring fair treatment throughout all stages of employment.

Training and Equal Opportunity Policies

Training managers and employees on equal opportunity policies and anti-discrimination practices is essential. This proactive approach not only fosters a culture of inclusion but also reduces the risk of discrimination claims and legal disputes. Regular training sessions should cover identifying and addressing unconscious bias, understanding diversity in the workplace, and promoting inclusive behaviours among staff members.

Diversity and inclusion

Diversity in the workplace encompasses differences like gender, race, age, disability, sexual orientation, and more, while inclusion involves creating an environment where every individual feels valued and can contribute fully.

UK employment laws, including the Equality Act 2010 and the Public Sector Equality Duty (PSED), mandate fair treatment and prohibit discrimination based on protected characteristics. Small businesses must adhere to these laws, ensuring equal opportunities, non-discriminatory recruitment, reasonable adjustments for disabilities, and regular staff training on diversity and inclusion.

Practical steps for small businesses include implementing an Equal Opportunities Policy, fostering inclusive recruitment practices, making workplace adjustments for disabilities, conducting diversity training, monitoring diversity metrics, and handling discrimination complaints effectively.

Beyond legal compliance, promoting diversity and inclusion can enhance creativity, improve employee satisfaction, widen the talent pool, and enhance a company’s reputation for ethical practices and legal compliance.

Disability discrimination

In the context of UK employment law, disability is defined under the Equality Act 2010 as a physical or mental impairment that significantly impacts a person’s ability to carry out normal daily activities over the long term.

Defining Disability Criteria

A condition is considered long term if it lasts for more than 12 months, while substantial impairment means the condition is more than minor, significantly affecting tasks that are part of daily life.

Identifying Disability

An individual is recognized as disabled if they have a physical or mental impairment that meets the criteria of substantial and long-term negative effects on daily activities. Examples include mobility difficulties, reliance on aids like hearing or sight aids, learning disorders such as dyslexia or dyspraxia, and long-term mental health issues like depression, anxiety, or schizophrenia.

Covered Conditions

The Equality Act 2010 also covers conditions that recur or fluctuate, such as Rheumatoid Arthritis, Myalgic Encephalitis (ME), Chronic Fatigue Syndrome (CFS), Fibromyalgia, and epilepsy. Progressive or genetic disorders like HIV, Cancer, Multiple Sclerosis, Motor Neurone Disease, and Muscular Dystrophy are automatically protected from the day of diagnosis.

Protection Beyond Recovery

Even individuals who have recovered from a previous impairment are protected against discrimination under the law. If someone faced discrimination due to a past disability, they are still safeguarded by legal provisions.

Employer Responsibilities

As an employer, it is crucial to prevent discrimination in all aspects of employment:

• Recruitment: Ensuring fair treatment in job advertising, application processes, and interviews.
• Contracts and Policies: Implementing non-discriminatory terms in contracts, policies, and handbooks.
• Reward and Promotion: Avoiding discriminatory practices in pay, benefits, training, and career development.
• Termination and Redundancy: Ensuring fairness in decisions related to termination, dismissal, and redundancy.

Forms of Discrimination

• Direct Discrimination: Treating someone less favourably because of their disability, such as denying a role requiring computer skills to a blind person.
• Indirect Discrimination: Implementing policies or practices that disadvantage employees with disabilities, even if unintentional.
• Other Protections: Employees are also safeguarded from discrimination by perception (assumptions about their abilities) and association (treating someone unfavourably due to their connection with a disabled person). Harassment of disabled individuals, including offensive behaviour, gestures, or jokes, is strictly prohibited.

Consequences of Disability Discrimination

Employers who engage in or permit disability discrimination may face tribunal claims with potentially unlimited fines or financial awards. It is essential for SMEs to uphold equal opportunity principles and implement robust policies to mitigate legal risks and foster a fair and inclusive workplace environment.

Disability and Reasonable Adjustments

Employers have a legal obligation to make reasonable adjustments to ensure that employees, trainees, apprentices, contract workers, and business partners with disabilities are not substantially disadvantaged in performing their roles.

Understanding Reasonable Adjustments

Reasonableness of adjustments is assessed based on specific circumstances, considering factors such as whether the adjustment would alleviate the disadvantage, feasibility, affordability, and any health and safety risks posed to others.

Examples of Reasonable Adjustments

These adjustments may involve modifying recruitment processes, offering assistance during interviews, conducting interviews in accessible locations, providing assistive devices for tests, altering work methods, installing physical accommodations like ramps or hearing support systems, supplying specialized equipment such as ergonomic chairs or desks, and ensuring accessible training and recreation facilities.

Legal Obligations for Reasonable Adjustments

Employers must consider and implement reasonable adjustments when they become aware or should reasonably be aware of an employee or job applicant’s disability. This obligation also applies when an individual requests an adjustment, experiences job-related difficulties due to their disability, or faces delays in returning to work after disability-related absences.

Refusal of Adjustments

Employers can refuse adjustments if they can demonstrate that the changes are not feasible or financially viable, or if they would fundamentally alter the core duties of the job role. However, it is advisable to seek legal advice before refusing adjustments to someone with a disability.

Consequences of Non-Compliance

Failure to implement reasonable adjustments without valid justification can be considered discriminatory by courts and may lead to unlimited tribunal awards against the employer. It is essential for employers to proactively assess and accommodate reasonable adjustments to ensure compliance with disability discrimination laws and foster an inclusive workplace environment.

Working Time Directive

The Working Time Regulations 1998 protect employees from excessive working hours and ensure adequate rest periods. Key entitlements include:

Maximum Weekly Working Time:

 Employees should not exceed an average of 48 hours per week, unless they opt out voluntarily. This limit applies across all jobs an employee holds. Employers must ensure compliance and adjust schedules if employees exceed this limit without opting out.

What Counts as Working Time:

• Job-related training
• Remote work
• Overseas assignments
• Any other time stipulated in the contract as working time
• Unpaid overtime required by the employer
• Working lunches or events
• Paid overtime
• On-call time (in certain cases)
• Travel time to and from client sites
• Normal contracted hours
• Secondary employment

Rest Periods:

• Daily rest: Employees must have at least 11 consecutive hours of rest within each 24-hour period.
• Weekly rest: Employees are entitled to 24 hours of uninterrupted rest every seven days, which can be averaged over two weeks, allowing for two days off.

Breaks:

Employees are entitled to breaks if their working day exceeds six hours.

Night Work:

• Night employees should not work more than an average of 8 hours in any 24-hour period.
• Regular night workers must receive free health assessments.
• Night workers with health issues related to night work should be transferred to day work where feasible.

Paid Annual Leave:

Employees are entitled to a minimum of 4 weeks (20 days) of paid annual leave, in addition to statutory holidays.

Special Protections:

Young employees have specific protections under the Working Time Directive to safeguard their well-being.

Record Keeping:

Employers must maintain accurate records of employees’ working hours, including overtime, to demonstrate compliance with the Working Time Directive.

Opt-Out:

Employees can voluntarily opt out of the 48-hour maximum work week. This does not negate other protections provided by the Directive. Employees cannot be compelled to opt out and have the right to opt back in with appropriate notice periods (typically 7 days to 3 months).

Health and Safety:

The Directive aims to protect employees’ health and safety, necessitating that employers ensure working hours do not compromise employee well-being.

Compliance with the Working Time Directive is essential for SMEs to avoid legal issues, promote employee welfare, and maintain productivity. By understanding and implementing these guidelines, SME employers can create a balanced and lawful working environment that supports both business needs and employee rights.

TUPE (Transfer of Undertakings)

TUPE, or the Transfer of Undertakings (Protection of Employment) Regulations 1981 (amended 2006, 2014), is legislation aimed at safeguarding employees’ rights when the business or services they work for are transferred to a new employer.

Dealing with a TUPE transfer can be a complex and time-consuming HR matter for any business.

TUPE applies primarily in two types of transfers:

1. Business Transfer: This occurs when a business or part of it is transferred to another company through a merger, acquisition, or change in ownership.
2. Service Provision Transfer: This happens when a contract to provide services is transferred from one contractor to another, such as when a cleaning service contract changes hands.

In both cases, employees associated with the business or service provision have the right to retain their jobs and maintain their existing employment rights under TUPE regulations. This protection extends even if an employee’s time is only partially connected to the transferred business or service contract.

For example, if an employee, works part-time on a contract that is transferred, such as cleaning a school, they have a legal right under TUPE to continue that role.

When a new employer takes over, they assume all responsibilities and liabilities of the old employer, including ensuring that employees’ terms and conditions are not less favourable than those they previously enjoyed. This means any outstanding wage payments or other obligations become the responsibility of the new employer.

Changing or harmonizing terms and conditions for employees protected under TUPE is challenging. It can only be done for economic, technical, or organizational reasons (ETO reasons) that entail changes affecting the entire workforce, such as restructuring.

Under TUPE, employees’ terms and conditions are protected indefinitely, ensuring continuity and stability for transferred employees.

By adhering to TUPE regulations, employers can ensure compliance with legal requirements while managing transitions smoothly and respecting employees’ rights during transfers of business or service provision.

Employers should communicate clearly with employees regarding potential changes and their impact on existing roles. Proper consultation with affected employees is essential to ensure a smooth transition.

Time Off

Legally paid time off (full pay or statutory government pay rates)

• Sick pay
• Annual leave 5.6 weeks per year
• Maternity leave
• Paternity leave
• Shared parental leave
• Ante natal appointments for pregnant women
• Child bereavement.

Unpaid time off (unpaid time off falls into 3 categories)

Unpaid leave granted by law

• Jury service
• Magistrates (up to 13 full
• 26 half days per year)
• Emergency time off for dependents
• Parental leave up to 13 weeks for children up to 18 years of age
• Right to attend antenatal appointments
• Defence Secretary call up notice (armed services).

Unpaid leave you have to give due consideration to by law

• Training or study leave under Section 63D of the Employment Rights Act.

Unpaid leave that is at the discretion of the company

• Career breaks
• Sabbatical
• Bereavement leave
• Compassionate leave
• Doctors dentist or hospital appointment.

There is no legal right for an employee to have paid time off to attend any doctor, dentist or hospital appointment. As a business you are well within your right to:

• Refuse time off
• Request appointments be made outside of normal work hours
• Request the employee take annual leave to cover the appointment
• Advise that attending these appointments will be on an unpaid basis
• Request that any time off must be made up at a later date.

Other important information

Pensions

As an employer you have to offer and automatically enroll your employees into a pension scheme if they:

• Are classified as an employee or worker
• Normally work within the UK
• Are aged between 22 and the state pension age
• Earn above the minimum earnings threshold.

National minimum wage

All employees are entitled to be paid a minimum national minimum wage based on their age.

Payment and deductions

You must make all required payments to employees as specified in the contract. Failure to make payments or deduct monies from an employee without prior consent will be an unauthorised deduction of wages.

Statutory Sick Pay (SSP)

All employees are entitled to SSP if they meet the qualifying criteria, SSP is subject to 3

unpaid waiting days. As a business you cannot ask an employee to provide a doctor’s sick/fit note until after 7 days.

Flexible/Zero hours holidays

Flexible/Zero hours workers still accrue and have a right to paid holiday. Failure to give

Flexible/Zero hours workers their legal holiday entitlement will result in formal claims via

tribunal.

GDPR

GDPR is a set of regulations to protect the retention and handling of data. As an employer

you must be able to demonstrate that employees:

• Were informed of the purpose and use of their personal data, including being given clear explanation of how the business will handle their data
• Have freely consented to the use and processing of their data.

Disclosure & Barring Service (DBS) Checks

If you have regular dealings with, or contact with, children or vulnerable adults the company has a responsibility to ensure that the necessary DBS checks have been undertaken on its employees. Failure to do so could result in the company being liable for civil or criminal prosecution.

Business events and parties

If the business arranges or employees on business premises arrange a party or event to be held inside or outside business hours, then normal business terms and conditions will apply.

Conclusion

HR compliance is a critical aspect of running a successful SME. By ensuring you have the right contracts, policies, and procedures in place, you protect your business from legal risks while creating a positive working environment. If you’re unsure whether your business is fully compliant, consider seeking professional HR support or conducting an HR audit to identify and address any gaps.

For tailored HR advice, handbooks, contracts, and HR compliance support, Contact KeyHR today!