Hiring staff more efficiently

If you decide on this route, you need to make sure that the contractor is in fact self-employed, and will pay their own income tax and national insurance. There is a leaflet available from the HMRC website (IR56) that explains more about this area of employment.

For any non-self-employed staff, you must make tax arrangements with Revenue and Customs, and take the income tax and NI owed out of their salary each month. A new employee must provide a P45 and National Insurance Number when they start work.

When hiring staff, you must not discriminate against age, sex or disability. If you hire more than 5 people your premises should be able to accommodate the disabled - ramps, lifts and disabled toilets are a minimum requirement.

Once a candidate has agreed to take a job with your company, you should give them a written contract within 3 months. It should lay out the main terms of employment such as pay, hours, holiday entitlement, pension provision (all businesses with more than five employees must offer access to a plan), notice periods and disciplinary procedures.

If you are taking on a few staff you may wish to draw up company policy documents on certain aspects of your business. The policy should detail how each issue is dealt with and what is expected of the employee.

Think about having policies on holiday and other leave, working hours, resolution of disputes, confidentiality and the use of company facilities like e-mail and staff training to name a few.

Finally, staff are becoming much more aware of their rights than ever before, therefore it pays to be prepared and protected. According to the Health and Safety Executive (HSE) almost a third of applications to employment tribunals involve companies with less than 10 employees.

The HSE can provide you with an information pack about making your workplace a safe and healthy environment. There are also risk assessment kits available to help you assess any dangers in your workplace.

A spokesman for the HSE says: "If you have to shut down your business because of an accident, or lose an employee to sickness, it does cost. In the short run it might cost to put health and safety right, but the payback is in the long term."

The HSE gives out heavy fines and the occasional prison sentence for companies that break health and safety standards. All businesses with employees should ensure that they are fully covered by Employer's Liability and Public Liability insurance at a minimum.

Hiring staff to spread your workload and to expand your business is a positive step forward for a company. As long as a business owner understands the issues involved and takes it one step at a time, there is no reason why his company should not carry on growing successfully.

If you're taking on staff and need Employer's Liability insurance, why not review your entire business insurance package as well? Simply Business offers a fast easy way to choose from a range of impartial quotes and then buy either online or with a consultant over the phone.

- Compare quotes online