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12 min read

How to Hire Using an Employer of Record in the UK (2025)

Employer of record

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Author

Jemima Owen-Jones

Last Update

June 25, 2025

Table of Contents

What is a UK Employer of Record?

Top reasons to use an EOR in the UK

How to hire in the UK: Step-by-step guide

Employment compliance tasks an Employer of Record manages in the UK

How much does it cost to hire through an EOR in the UK?

Which UK EOR should you choose?

Is Deel Employer of Record a strong choice for hiring in the UK?

Hire employees in the UK with Deel Employer of Record

Key takeaways
  1. Setting up a UK entity to make a local hire can take months and cost over £20,000 in legal, tax, and payroll setup.
  2. A UK Employer of Record lets you engage talent through its local entity, bypassing setup delays, legal costs, and compliance headaches.
  3. Deel EOR owns its UK entity for full control, supports hiring in 150+ countries, delivers transparent pricing, real-time compliance monitoring, and has top G2 ratings.

Hiring talent in the United Kingdom gives you access to one of Europe’s deepest tech, finance, and creative talent pools. The market speaks English (of course!), sits in a friendly time zone for both US and EMEA teams, and ranks high for remote-work readiness.

But the UK also has a maze of rules—setting up a local entity, registering for PAYE, calculating 13.8 % employer National Insurance contributions, and auto-enrolling staff into pensions. Miss a filing, and HMRC penalties arrive fast. That complexity stops many companies from tapping into UK talent.

An Employer of Record (EOR) removes the friction. The EOR becomes the legal employer, runs compliant UK payroll, and shoulders liabilities so you can focus on building your team.

Deel EOR, with its wholly-owned UK entity, transparent pricing, and real-time compliance monitoring, make it the fastest path to hiring UK talent without the usual headaches.

See also: What’s the Fastest Way to Enter Markets and Hire Globally?

What is a UK Employer of Record?

A UK Employer of Record is an organization that hires your talent in the UK through its UK entity so that you can skip the incorporation process and onboard new employees faster. You direct the day-to-day work; the EOR handles every statutory duty—payroll taxes, pension auto-enrolment, holiday leave, and workplace insurance.

In short:

  • You keep operational control
  • The EOR takes legal and compliance responsibility

Because the EOR is the legal employer, any HMRC audits, tribunal claims, or data-protection checks go to the EOR first, not your organization.

Deel EOR's UK entity sits on-shore, so your team enjoys full UK employment rights while you avoid costly subsidiary formation.

See also: Employer of Record (EOR): A Complete Guide

Deel Employer of Record
Hire employees globally with the #1 Employer of Record
Deel provides safe and secure EOR services in 100+ countries. We’ll quickly hire and onboard employees on your behalf—with payroll, tax, and compliance solutions built into the same, all-in-one platform.

Top reasons to use an EOR in the UK

To establish a legal entity in the UK, you need lawyers, directors, bank accounts, and months of filings. With an EOR like Deel, you enjoy:

  • Faster market entry: Sign one master service agreement with Deel EOR and hire in 2–5 days vs. the 3–6 months average to set up a company
  • Lower upfront spend: Entity setup, legal drafting, and payroll software often exceed £20,000 in year one. Deel EOR charges one flat monthly fee per employee, with no surprise extras
  • Guaranteed PAYE compliance: Real-time information (RTI) submissions filed on time, along with income tax and National Insurance contributions
  • Pension auto-enrolment done for you: Employers must auto-enrol eligible staff and contribute at least 3 %. The EOR handles enrolment, assessments, and opt-outs
  • GDPR peace of mind: Deel’s Data Processing Addendum and UK-approved Standard Contractual Clauses protect employee data, plus Deel IP Guard secures inventions
  • Misclassification cover: Recent Uber and Deliveroo cases show steep penalties for treating contractors as employees. EOR employment status removes the risk

Choosing Deel was easy—they offer unmatched compliance and HR support that scales with fast-growing companies like ours. They’ve been the best partner for executing our global hiring strategy.

Yunjung (Rina) Bae,

Director of People, MarqVision

How to hire in the UK: Step-by-step guide

Use this eight‑step checklist to hire UK employees in weeks, stay fully compliant, and skip the cost of opening a local entity.

1. Choose an EOR with a wholly-owned UK entity

Pick an EOR provider that owns its UK entity, instead of relying on third-party providers. Ownership gives you audit-ready contracts and faster issue resolution. Deel EOR's UK entity means every employment document is issued directly, avoiding third-party delays.

Tip: Ask to see the EOR’s Companies House registration number before signing.

2. Book a demo and verify social proof

Schedule a live demo and look for real-time compliance dashboards, AI-powered salary benchmarks, and integrations with your HRIS. Scan reviews on G2 and Trustpilot; Deel EOR holds a 4.8/5 average.

Tip: Request a customer reference in your industry to confirm UK payroll accuracy.

3. Request a transparent EOR quote

Ask for a line-item quote: gross salary, 13.8% Employer NI, pension costs, apprenticeship levy, and the flat EOR fee. Deel EOR shows every statutory element up front—no hidden “implementation” charges.

Tip: Compare costs before you expand—read our article EOR vs. Entity Costs: What’s More Affordable?

4. Submit a 12–24-month hiring plan

Share head-count projections so the EOR can forecast cash funding, annual leave accruals, and benefits negotiations. With Deel’s workforce planning and salary benchmarking, you’ll see budget impacts before you commit.

Tip: Update the plan quarterly; it keeps your cost forecasts realistic.

5. Create the employment contract on the platform

Choose an indefinite or fixed-term contract. Deel’s contract generator auto-fills probation, notice periods, holiday, and pension details based on UK employment law. Add role-specific clauses, assign equipment, and grant stock options—Deel’s legal team reviews everything for compliance.

Tip: Include a clear invention-assignment clause to lock down IP created remotely.

6. Confirm the candidate’s right to work

Upload passport scans or share codes. The platform verifies them against the Home Office system. With Deel Immigration, you can even sponsor work permits if needed.

Tip: Run background, work authorization, and work permit eligibility checks at the offer stage to avoid last-minute surprises.

7. Run the onboarding workflow

Deel EOR automates bank details collection, P45 uploads, and pension enrolment. Employees pick benefits during self-service onboarding.

Tip: Use Deel Engage to roll out training and performance goals, and Deel IT to provision equipment.

8. Maintain ongoing compliance

Legislation changes yearly, including minimum wage, NI thresholds, and holiday pay calculations. Deel Compliance Hub flags new rules and updates contracts automatically.

Tip: Subscribe to Deel’s compliance newsletter to receive clear and concise summaries of relevant compliance changes.

Platform Tour
Explore the Deel platform
See how easy it is to add and configure a brand-new employee contract through the Employer of Record service. Click to launch a platform demo.

Employment compliance tasks an Employer of Record manages in the UK

Below is an overview of key 2025 employment requirements that employers hiring in the UK must follow, and how a UK EOR like Deel covers each one.

Category Key Requirements (2025)
Statutory employer costs Cover 15% National Insurance on salary above £417/month. Contribute a minimum 3% to a private workplace pension via Penfold. Pay 0.5% Apprenticeship Levy on NICable salary.
Employment contracts & probation rules Written statement due on or before day 1 of work. Probation typically 3–6 months; notice during probation is 1 week, then scales with tenure—up to 12 weeks for 12+ years service.
Pay and working hours Minimum wage (National Living Wage): £12.21 per hour for workers aged 21+. In the United Kingdom, a standard work year includes 260 working days. A typical schedule is Monday to Friday, 8 hours per day, totaling 40 hours per week.
Payroll & PAYE compliance Employers must run PAYE, deduct tax and NI, and file Real Time Information submissions on or before every payday. Records kept for 3 years. GDPR requires secure payroll data handling; Deel encrypts data at rest and in transit.
Vacation and public holiday allowances Full-time employees accrue 28 paid days off.
Income taxes Withhold income tax, bonuses, and allowances under the PAYE system. Remit payments to HMRC by the 22nd of each month. Ensure accurate use of employee tax codes. Issue P60 (by May 31) and P45 (upon termination).
Expenses, allowances, and bonuses Approved expenses are tax-free if submitted with full documentation. Most travel, equipment, and client-related costs are non-taxable. Recurring services (e.g. phone, coworking) are taxable. Per diems aren't available in the UK—employees must submit receipts. All allowances (e.g. WFH, relocation) are taxable. Bonuses are taxed as regular income.
Statutory benefits & pension requirements Employers auto-enroll staff aged 22–state pension age, earning £10,000+ per year, and contribute at least 3%. 8 % total minimum contribution.
Maternity, paternity, parental, adoption & foster leave 52 weeks maternity, 2 weeks paternity, and shared parental leave.
Sick leave, bereavement leave, and carer’s leave Full-time employees qualify for Statutory Sick Pay up to £118.75/week for 28 weeks.
Terminations/dismissals, redundancy, severance, and resignations Fair dismissal grounds: capability, conduct, redundancy, statutory restriction, or other substantial reason. Consultation required for 20+ redundancies. Statutory redundancy pay: 0.5–1.5 weeks’ pay per year of service, capped at £719/week up to £21,570.
Health & safety Employees are required to complete an annual Health & Safety (H&S) training. They must complete this training as part of their onboarding process.
Misclassification risk The UK takes a strict approach against employee misclassification. Penalties include unpaid taxes, fines, and liability for back pay, holiday, and pension entitlements.
Data & IP protection The UK enforces strong data protection and IP laws under UK GDPR to support innovation, trade, and individual rights.
Continuous Compliance™
Unlock Continuous Compliance™ with Deel
Keep your finger on the pulse of global compliance issues like never before. Our Compliance Hub provides access to the latest regulatory updates and risk warnings, offering guidance and actionable alerts to enhance compliance—all in a single place.

How much does it cost to hire through an EOR in the UK?

The cost of hiring an employee through an EOR includes the employee’s gross salary, mandatory employer costs required by the country, such as statutory benefits, taxes, and fees, and finally, the EOR’s management fee.

Hiring through an EOR like Deel gives you a predictable monthly fee that covers payroll, compliance, and admin—no setup costs, legal fees, payroll software subscriptions, or extra onboarding or offboarding charges.

Here’s a breakdown of the costs you’ll face when opening your own UK entity compared to hiring through Deel’s EOR:

Factor Your own UK entity Deel EOR
One-off costs £24,249 up-front £0
Annual, recurring costs £36,703 £0
Deel Employer of Record service fee N/A £5,295 per employee
Estimated total annual costs £60,952 £5,295
Time to first hire 2 weeks 1 business day(s)

Flat pricing means you can scale headcount without surprise bills—one of the largest benefits our customers cite.

Use our Employee Cost Calculator to see the full cost of hiring talent in the UK, including salary, taxes, pensions, and statutory fees.

Global Hiring Toolkit
EOR vs. Entity Calculator
Looking for the most cost-effective way to expand your team abroad? Discover the best option for your business with our calculator.

Which UK EOR should you choose?

When comparing EOR providers, don’t compromise on the following:

  • Entity ownership: Choose a partner with a wholly-owned, registered UK entity. It tightens control and speeds up document processing
  • Proven compliance expertise: Look for in-house UK legal, payroll, and HR teams, plus real-time compliance monitoring. Deel’s Compliance Hub alerts you to every legislative change
  • Platform breadth: Beyond hiring and payroll, you want work permit support, equity management, device provisioning, and performance tools. Deel offers visa and immigration assistance, compensation benchmarking, equiptment, and more—so you won’t outgrow the platform
  • Global coverage: Select a UK Employer of Record with entities in other countries. This way, if you decide to hire employees in more countries, you can use the same EOR and keep all your global workforce in the same system. Deel provides safe and secure EOR services in 150+ countries

See also: Owned Entity vs. In-Country Partner: The Best Choice for Global Hiring

Discover how Lloyd’s List Intelligence expanded to new markets with Deel EOR

Lloyd's List Intelligence provides business intelligence, data, and analysis on maritime trade and operations.

As a leader in a complex and regulated market, they faced challenges in expanding and managing teams across multiple locations. They explored different ways to set up entities but found it complicated, as each country had its own payroll regulations and tax requirements.

“We just didn’t have the economies of scale, time, and resources to be able to set up entities in each of those different locations. We went with Deel because they were able to provide us with everything we needed in one platform.”Hetty Townsend, APAC People And Culture Business Partner, Lloyd's List Intelligence

Learn more

Is Deel Employer of Record a strong choice for hiring in the UK?

Yes—Deel is a top-tier Employer of Record solution for hiring in the UK, combining deep local compliance expertise with industry-leading tech. Deel’s wholly-owned UK entity, transparent pricing, and proven G2 leader status make it the safest, fastest way to onboard British talent without the pain of entity setup or compliance risk.

With Deel, you have:

  • A wholly-owned UK entity: Direct hiring and compliance, no third-party delays or costs
  • Hire in 2–5 days: Skip the 3–6 month entity setup process
  • Transparent, all-inclusive pricing: No hidden fees—see every statutory cost up front
  • Full compliance: Handles PAYE, Employer NI (13.8%), pension auto-enrolment, and GDPR
  • 150+ countries covered: Scale beyond the UK with one platform
  • IP and data protection: Deel IP Guard and GDPR-compliant processing
  • No UK bank account needed: Deel manages payroll and statutory filings
  • Local benefits and contracts: Platform auto-generates UK-compliant documents
  • Onboarding support: A Dedicated UK team ensures a smooth candidate experience

With Deel EOR, you avoid the hassle of setting up a UK entity, keep your costs predictable, and ensure every hire is 100% compliant, so you can focus on building your team.

See also: More Than a Service: EOR as a Strategic Partner in Business Growth

Hire employees in the UK with Deel Employer of Record

Ready to expand into the UK without months of legal prep or compliance headaches?

Deel EOR lets you hire full-time employees in days, not months, with a flat, transparent EOR fee that covers payroll, pensions, benefits, and more.

Don’t let entity setup or complex local employment laws slow your growth—let Deel handle the hard parts so you can hire faster and smarter.

Book a demo to see how easy it is to onboard your next UK hire and keep your costs crystal clear.

FAQs

You can onboard a UK employee in as little as 2–5 business days once documents are signed and right-to-work is verified.

Yes, employees must have a UK bank account for payroll deposits.

Deel generates a UK-compliant employment contract, including required clauses for pay, leave, probation, and IP assignment.

Deel manages all PAYE tax, National Insurance, and Real-Time Information (RTI) filings with HMRC.

UK employees are typically paid monthly. All tax filings are due on or before payday, and Deel ensures on-time compliance.

Deel covers statutory sick pay, 28 days’ paid annual leave (including public holidays), pension auto-enrolment, and parental leave.

Probation periods in the UK usually last up to 6 months; Deel customizes this in each contract per your needs.

Yes—Deel’s immigration team can support visa sponsorship and right-to-work checks as part of the onboarding process.

No—since Deel is the legal employer, your workers are fully protected as UK employees, not contractors.

Deel’s contracts include clear IP assignment, and all employee data is processed under strict GDPR compliance.

Ready to avoid UK compliance risks and hire faster? Book your Deel demo today.

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About the author

Jemima is a nomadic writer, journalist, and digital marketer with a decade of experience crafting compelling B2B content for a global audience. She is a strong advocate for equal opportunities and is dedicated to shaping the future of work. At Deel, she specializes in thought-leadership content covering global mobility, cross-border compliance, and workplace culture topics.

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