Pound Sterling (GBP)
Onboard, pay and manage employees in the United Kingdom with Deel.
Usually, to hire in the United Kingdom, your business needs an entity. That means a local office, an address registered as a subsidiary, and an account with a local bank. All of this, plus navigating regional benefits, payroll, tax, and HR laws, can take months.
Deel lets you hire employees in the United Kingdom quickly, easily, and compliantly. We even automate tax document collection, payroll, benefits, and more. For your existing direct employees, we can manage your entire payroll operation from end-to-end.
All the necessary benefits for the United Kingdom
built right in
Deel allows you to provide localized benefits for employees in the United Kingdom within minutes. All in one manageable online dashboard.
- Employers Liability Insurance
- Professional Training
- State Pension Fund
- Private Healthcare - Unisure (optional)
- Private Healthcare - Freedom (optional)
- Private Healthcare - Allianz (optional)
- Pension benefits - Penfold (optional)
- Private Healthcare - Canada Life (optional)
Our quickstart guide to hiring in the United Kingdom
Navigate the tabs below to learn everything you need to know about hiring an employee in the United Kingdom
Minimum Wage Requirements
Minimum wage varies by age and working hours. For employees aged 23+ working 40 hours a week, the minimum wage is £1,806.13/month (£21,673.60/year).
Individual Income Tax
The individual income tax ranges from 0% to 45%. Income tax is calculated according to progressive rates. Multiple additional factors may impact overall rates such as the household status and the number of children.
|Gross Annual Income||Tax Rate (%)|
|Up to £12,570||0%|
|£12,571 - £50,270||20%|
|£50,271 and £150,000||40%|
There are slightly different tax rates and banding in Scotland, however, this is all taken care of by the tax authorities. Employees based from a Scottish address will have a slightly different tax code that will enable the correct taxation to be applied.
The employer cost is generally estimated at 17.3% of the employee salary.
- National Insurance Contributions - 13.80%
- Mandatory Private Workplace Pension - 3%
- Apprentice Tax Levy - 0.5% of the employee's (NICable) salary
The Apprentice Tax Levy is calculated on the employee's NICable salary.
Optional and Conditional Costs:
- Optional Private Health Insurance
- Single employee: GBP 67.70
- Employee + children: GBP 98.55
- Couple: GBP 129.40
- Family: GBP 160.25
- Optional Life Insurance - GBP 10, GBP 20, GBP 30 or GBP 40
- Private Health Insurance Admin Fee - USD 15 per invoice with Health Insurance
Overtime Pay & Maximum Hours
- first 6 weeks: 90% of their average weekly earnings (AWE) before tax.
- following 33 weeks: £172.48 or 90% of their AWE (whichever is lower).
- final 13 weeks of maternity leave are unpaid
Mother and father may choose instead to share up to 50 weeks of leave and 37 weeks of pay between them after the first 2 weeks of compulsory maternity leave to be taken only by the mother (4 weeks if the mother works in a factory).
The first 37 weeks are paid at £172.48 a week or 90% of the employees' earnings, whichever is lower. The remaining 13 weeks are unpaid.
In addition to the standard Shared Parental Leave, employees are also entitled to an additional 18 weeks of unpaid leave that can be used up until the child’s 18th birthday.
Terminations must respect complex rules and the rules of an employee’s employment country. The off-boarding is always handled by the Employer with the primary stakeholders. It may include ad-hoc fees as well as required or recommended steps on specific termination cases.
Terminations in the UK can be complex. There is no at-will termination in the UK for employers outside the probation period and termination must be done for just cause.
Compliant terminations include:
- Fair dismissal
- Unfair dismissal
- Constructive dismissal
- Wrongful dismissal
The minimum notice period is 1 week and will be increased according to the length of the employment.
- 1 week if the length of service is 1-2 years
- 1 week for every year of service on 2 - 12 years
- 12weeks if the length of services is 12+ years
Severance for Employees
In the UK, all employees who are terminated due to redundancy are entitled to severance pay. Severance pay is calculated as follows.
- 0.5 weeks pay for each year of service where the employee was below the age of 22
- 1 weeks pay for each year of service where the employee was between 22 to 40 of age
- 1.5 weeks pay for each year of employment where the employee was 41 and over
Paid Time Off
Full-time employees are entitled to 20 day of paid time off (PTO) a year plus an additional eight public holidays.
Please note, in the platform this is listed as 20 days of PTO and the employee will be entitled to an additional 8 days of public holiday on top of this.
PTO (Including public holidays) accrues at 5.6 weeks times the number of days a week the employee works.
Public holidays, also known as bank holidays, vary by region in the United Kingdom. There are 8 bank holidays in England and Wales, 9 in Scotland, and 10 in Northern Ireland.
- New Year's Day
- Good Friday
- Easter Monday
- Early May Bank Holidays
- Spring Bank Holiday
- Summer Bank Holiday
- Christmas Day
- Boxing Day
Additional Regional Holidays
- January 2: Scotland Day
- March 17: St Patrick's Day Northern Ireland
- July 12: The Twelfth Northern Ireland
- November 30: St Andrew's Day Scotland
Onboarding takes 1 business day after the SOW is signed.
Employment Contract Details
All Employment Agreements must include:
- Employer’s name
- Employee’s name
- Job title or Job description
- Start date
- Contract term
- End date for fixed term contracts
- Salary and salary frequency
- Working hours and days of work, if and how they may vary
- Working hours specifications if applicable (if employees will have to work on Sundays, during the ‘night period’ or take overtime)
- Holiday entitlement (and if that includes public holidays)
- Workplace and whether employees might have to relocate
- Additional workplaces if applicable
- Employer's address
- Probation period
- Any other benefits
- Obligatory training, and whether or not this is paid for by the employer
- Termination conditions
For employees, it must also include the date that a previous job started if it counts towards a period of continuous employment.
Hiring in the United Kingdom, hassle-free
With Deel, your business can easily hire employees in the United Kingdom with our EOR solution. If you have an entity, our Global Payroll solution takes care of payroll and compliance for your direct employees. Our 250+ in-house experts handle everything from managing local laws, complex tax systems, or your payroll in the United Kingdom and 150+ countries.
Estimate Employer Cost
*of employee salary