Hiring for your startup? Here’s what you need to know
- Constantine Law
- Mar 19
- 3 min read
Starting a new business is an exciting journey, but hiring your first employees comes with legal and practical challenges.
In our latest episode of The Employment Law Podcast, two of our esteemed partners—Fiona Hewitt and Catherine Wilson—share essential insights on navigating the recruitment process smoothly.
Here’s what you need to consider before bringing new talent into your business.
Clarity is key: Defining roles and responsibilities
Before diving into recruitment, Catherine Wilson emphasises the importance of having a clear job description:
“There needs to be some clarity… what is the job role and what is the job description? This isn’t just a paper exercise.”
Failing to define the job properly can lead to hiring mistakes, mismatched expectations, and even potential legal risks. The balance lies between being too generic and creating an unrealistic wish list.
As Fiona points out, job titles also matter—giving someone a senior-sounding title without the actual responsibilities can create pay disputes and organisational confusion down the line.
Avoiding common pitfalls
Recruitment isn’t just about finding the right fit—it also involves legal obligations. Discrimination laws, as Catherine highlights, apply from the moment you start hiring, not just after employment begins:
“Discrimination isn’t even a day-one right of employment—it actually can cover the whole recruitment process.”
Protected characteristics under the Equality Act 2010, such as race, sex, religion, and disability, must be carefully considered to avoid inadvertent bias or legal claims.
A particularly important reminder: discovering a new employee is pregnant is not a valid reason to withdraw an offer.
Budgeting beyond salary
Salary is just one part of the cost of hiring an employee. Additional expenses like National Insurance contributions, pension enrolment, and onboarding costs must be factored in. As Fiona puts it:
“It actually costs to onboard somebody, and that needs to be factored in.”
And with upcoming changes in April—including a reduction in the employers’ National Insurance threshold and an increase in the National Minimum Wage—business owners must ensure their budgets are realistic and sustainable.
The importance of references and compliance
References are often treated as a tick-box exercise—a formality—but Catherine warns against this mindset:
“References are not just a tick-box exercise… Former employer references naturally have a lot more weight than personal references.”
She also stresses the need for due diligence before finalising employment, including verifying a candidate’s right to work in the UK and carrying out industry-specific checks (such as DBS checks in the care sector).
Remember, failure to comply with these legal requirements can result in hefty fines or even criminal liability.
Employment contracts and workplace policies
Once a candidate is selected, providing a clear contract is essential. While not all terms must be in the contract itself, Catherine highlights the need for transparency on key conditions like pay, working hours, and notice periods.
“Sometimes our contracts are too long, and people don’t read them. Important terms can be buried.”
She suggests keeping some policies separate, such as maternity leave or grievance procedures, to allow easier updates without renegotiating contracts.
Ensuring accessibility—such as hosting policies on an intranet—can also help employees understand their rights and responsibilities.
Preparing for the future: What’s changing in UK employment law?
The legal landscape for employers is evolving. Catherine notes upcoming changes to ‘day-one rights,’ expanding protections for employees in areas like parental leave and unfair dismissal. There’s also ongoing discussion around simplifying worker classifications by merging employee and worker statuses.
Final thoughts
Hiring for your startup is a significant step, and while the process can be daunting, being well-prepared makes all the difference. As Fiona advises:
“Watch this space. We will be providing updates on employment law as changes become clearer.”
For a more in-depth discussion, listen to the full podcast episode and don’t forget to subscribe to get all the latest insights from our team.
If you need tailored advice, Constantine Law’s employment law specialists can help you navigate these challenges with confidence.
