The United Kingdom of Great Britain and Northern Ireland is a country that shares a common language, many cultural similarities, and a comparable approach to business as the U.S., but is also very different. If your company operates strictly in the U.K. or if you are planning on expanding into the U.K. market, it may be wise to make sure that you have HR software that is designed for the unique sovereign nation.
Employment Contracts in the U.K.
In the United Kingdom, it’s common for employers to provide an employment contract that an employee must agree to in order to work at the company. Employment contracts generally detail the rate of pay, holiday entitlement, general employment expectations, and notice periods. Once an employment contract has been signed, both the employer and employee are bound by the contract.
HR software can make it easier to draft and administer employment contracts. By providing an electronic copy of the employment contract, the documents also become easier to store and retrieve.
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Work eligibility is unique in the U.K. U.K. citizens, Swiss nationals, and citizens of the European Economic Area (EEA) are eligible to work in the U.K. without a work permit.
Countries included in the EEA are:
- Czech republic
- The U.K.
If a candidate doesn’t meet eligibility criteria, he or she may still be able to work with a visa. In some cases, a work permit may also be required. HR software that is designed for the U.K. will make it easy to figure out what candidates need to have in order to work and will assist with acquiring and organizing the information and documentation as required.
The U.K. has one of the longest tax codes in the world and tax laws change annually. Taxes are generally paid to Her Majesty’s Revenue and Customs, as well as local councils. The tax year also runs differently for businesses than for individuals, adding to the complexity of U.K. taxation.
Using HR software to assist with income deductions and taxes can decrease the likelihood of errors and make it much easier to comply with applicable laws. Of course, software must be designed to support the intricate tax needs of U.K. companies to be effective.
Holiday Entitlement and Sick Pay
Most workers in the U.K. are entitled to 28 days of paid leave per year. The leave may be referred to as statutory leave or holiday entitlement. Employers can include bank or public holidays in this total and can offer additional time off, but must offer the 28 days or 5.6 weeks of holiday entitlement per year.
Sick pay may be available for some workers, but often comes with very specific rules and requirements. Employees may not receive pay until they have been absent for at least three days and may be required to prove that they are unable to perform job requirements. Since sick pay may also be less than holiday pay, many employees use holiday hours when they fall ill.
Using HR software to manage time off requests and pay can be extremely helpful for U.K. employers. Automating holiday entitlement accrual and use can save time and reduce errors.