Hire in the United Kingdom

Employer of record in the United Kingdom

If a lack of speed or local expertise are among your top concerns when expanding to or employing workers in the United Kingdom (UK), an employer of record may be the best option for achieving your global growth objectives.

An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in the UK ― often in as little as two weeks ― without having to take on the cost and risk of establishing a local entity.

Learn about the hiring, employment, payroll and benefits requirements for workers in the UK and how our employer of record service, EOR, and local HR experts can help you manage your international employment needs.

Hiring in the United Kingdom

Top companies from around the world have seen the benefits of hiring in the United Kingdom, but its labor regulations can be intricate. Employment relationships in the UK are governed by the Employment Rights Act 1996, the Equality Act 2010, and various statutory instruments, as well as common law principles and individual contracts. The Employment Rights Act serves as the primary legal framework, outlining workers’ rights, employer obligations, and procedures for labor disputes. ​

Additionally, UK law places specific regulations on the use of temporary and agency workers. The Agency Workers Regulations 2010 ensure that agency workers receive equal treatment in terms of basic working and employment conditions after a 12-week qualifying period. Employers must provide written employment contracts detailing terms and conditions, and ensure compliance with statutory requirements such as the national minimum wage and working time regulations.​

Because of the complexity of the UK’s labor and tax laws, compliant employment contracts are a critical business requirement. With Safeguard Global as your partner, you can hire employees in the UK with confidence, knowing that every contract meets legal standards. We also provide guidance on cultural expectations and hiring best practices, while helping you stay current with regulatory changes.​

Employment contracts in the United Kingdom

In the United Kingdom, employment contracts can be fixed-term or permanent, depending on the nature of the job and the agreement between the employer and employee. Permanent employment contracts must include benefits such as paid annual leave, statutory sick pay, pension contributions, and protection against unfair dismissal. Fixed-term employees are entitled to the same benefits as permanent employees, and after four years of continuous service on successive fixed-term contracts, they may be considered permanent employees unless the employer can justify the continued use of fixed-term contracts.

The United Kingdom also has apprenticeship contracts, mainly for training, which are governed by national apprenticeship standards. Employers engaging apprentices are required to:

• Provide structured training aligned with approved curricula
• Pay apprentices a stipend in line with government regulations
• Ensure apprentices work in a safe environment
• Adhere to regular working hours as defined by labor standards

Probationary period

In the United Kingdom, probation periods are indirectly addressed in local law, commonly ranging from three to six months in the private sector, and up to nine months in government positions, as outlined in the Employment Rights Bill.

Termination and notice periods

In the United Kingdom, statutory laws generally require written notice for termination, with periods ranging from one week to 12 weeks based on the employee's length of service. In most cases, terminated employees are entitled to a warning and a fair hearing. Just cause for a dismissal includes the following:

• Gross misconduct
• Poor performance
• Redundancy
• Statutory illegality
• Some other substantial reason
• Capability issues
• Conduct issues

Employees with at least two years of service may be entitled to redundancy payments, calculated based on their age, length of service, and weekly pay. As your Employer of Record (EOR) in the United Kingdom, we can assist you in managing employee terminations by providing legal guidance and a personalized process to ensure compliance with labor laws and minimize legal risks.

Working hours and overtime

The standard workweek in the United Kingdom is 40 hours, typically structured as eight hours per day, Monday through Friday. Under the Working Time Regulations, employees must not work more than 48 hours per week on average, unless they voluntarily opt out of this limit in writing.

Any hours worked beyond contracted hours may be considered overtime. Overtime pay is not mandated by law but must be clearly stated in the employment contract. Employers must comply with rest break entitlements and maintain accurate records of working hours.

Pay and benefits

When negotiating terms of an employment contract with a candidate in the United Kingdom, here are some of the statutory benefits and paid leave requirements to keep in mind, as well as how an employer of record can support your company’s benefits strategy.

Minimum wages and salary benchmarks

Minimum wage rates in the United Kingdom are set nationally. As of April 1, 2025, the National Living Wage for workers aged 21 and over is £12.21 GBP per hour. Rates for younger workers and apprentices are lower, with £10.00 GBP for ages 18–20 and £7.55 GBP for those under 18 and apprentices. ​

The minimum wage applies uniformly across sectors, ensuring fair compensation regardless of industry.​

The overall annual average salary in the United Kingdom is approximately £37,430 GBP, with monthly earnings varying significantly by position, experience, and region. The median monthly salary is estimated to be around £3,119 GBP.​

By gender, a wage gap exists with average annual salaries for men typically exceeding those for women. Efforts to reduce this disparity continue through targeted government initiatives and policy reforms.​

Looking at salary by location in the United Kingdom

• London: Known for offering salaries above the national average, particularly in sectors such as finance, technology, and healthcare
• Manchester: Offers competitive compensation in industries like education, manufacturing, and information technology, with wages generally reflecting the local cost of living
• Birmingham: While salaries in Birmingham are competitive, certain sectors may offer compensation slightly below the national average, influenced by regional economic factors​

As your employment partner in the United Kingdom, Safeguard Global can provide you with the latest resources and insights on average employee compensation across various roles and regions, ensuring that you make competitive and compliant employment offers.

Payroll frequency

In the United Kingdom, employees are typically paid on a monthly basis, with salaries disbursed between the 25th and 30th of each month, as specified in the employment contract or company policy. While there is no statutory requirement for a specific pay frequency, monthly payments are standard, ensuring regular income for employees. ​

In addition to regular monthly wages, employees may receive additional compensation such as performance bonuses or commissions. These payments are often stipulated in employment contracts or internal company policies and are disbursed according to the terms outlined therein. Employers are required to adhere to the agreed-upon schedules for these payments to maintain compliance with labor regulations.

Bonuses and additional payments

In the United Kingdom, there is no statutory requirement for employers to provide bonuses; however, bonuses are commonly used to reward employee performance. Bonuses can be contractual, where the employer must pay the bonus if certain agreed criteria are met, or discretionary, where the employer has flexibility over whether to award the bonus. Even discretionary bonuses must be awarded based on fair and objective criteria, and they cannot be withheld arbitrarily. Employers are encouraged to clearly outline bonus schemes in employment contracts to ensure transparency and compliance with employment laws.

Employee benefits

Employers in the UK are required to provide several statutory benefits under national labor law.

• Pension auto-enrollment: Employers must enroll eligible employees into a workplace pension scheme and contribute at least 3% of qualifying earnings.
• Statutory Sick Pay (SSP): Employees who are off sick for more than three consecutive days may receive £116.75 GBP per week for up to 28 weeks.
• Maternity and paternity leave: Eligible employees are entitled to up to 52 weeks of maternity leave and up to two weeks of paid paternity leave.
• Holiday entitlement: Employees are entitled to a minimum of 5.6 weeks' paid holiday per year, including public holidays.

Many employers also offer supplemental benefits, such as private health insurance, childcare vouchers, cycle-to-work schemes, and enhanced sick or parental pay. These benefits help attract and retain talent in competitive sectors.

As your employer of record in the UK, we help design compliant and competitive benefit packages that align with statutory obligations and market expectations.

Tax and social contributions

Income tax and employee deductions

In the United Kingdom, withholding tax is known as Pay As You Earn (PAYE) and is deducted by employers before paying salaries to employees. Employers must deduct PAYE from employee salaries based on applicable income tax rates and submit it to HM Revenue & Customs (HMRC).

Employer payroll contributions

The United Kingdom's social security system requires employer contributions that are dependent on the total number of employees, and these contributions cover pensions, medical care, disability insurance, and gratuity payments. In addition, workers' compensation is financed by contributions from state governments, employers, and employees.

Business tax and compliance

Employers in the United Kingdom must adhere to various taxation and regulatory compliance requirements to operate legally and avoid penalties.​

• Corporate tax: Companies are taxed at 25% for profits above £250,000 GBP. A small profits rate of 19% applies to companies with profits of £50,000 GBP or less. ​
• Value added tax (VAT): VAT applies to businesses with annual turnover exceeding £90,000 GBP. Employers must register, file monthly or quarterly returns, and pay VAT on applicable goods and services. ​
• Pay As You Earn (PAYE): Employers must deduct PAYE from employee salaries, vendor payments, and contractor fees. PAYE must be deposited by the 22nd of the following month, and periodic returns must be filed.​
• Income tax returns (ITR): ITRs are filed annually based on company profits. Companies must also file annual financial statements with the UK tax authorities.

Work visas and immigration

Programs for foreign workers

In the United Kingdom, hiring foreigners without valid work visas can result in substantial fines, legal action, or revocation of sponsorship licenses. The UK government enforces strict regulations to ensure employment opportunities are first available to UK citizens unless specialized skills are required. Therefore, the UK has structured skilled migration programs for foreigners, with provisions for highly skilled professionals in sectors like healthcare, engineering, information technology, and education. Certain workers may apply for a UK work visa.

• Skilled Worker Visa: For individuals with a job offer in an eligible skilled occupation from a UK employer
• Global Talent Visa: For leaders or potential leaders in academia, research, arts, and technology
• Intra-Company Transfer Visa: For employees transferring within the same company to a UK branch​

Foreigners may also apply for a Standard Visitor Visa (Business), which is issued for attending meetings, conferences, or training sessions in the UK. It does not permit full-time employment in a UK company.

Sponsorship and employer responsibilities

Hiring a foreign national in the UK requires compliance with immigration and labor regulations. Employers must hold a sponsor licence issued by UK Visas and Immigration (UKVI) to hire workers under most visa categories.

Eligibility criteria

• The role must meet skill and salary thresholds defined by UKVI.
• The candidate must pass English language and financial requirements.
• The job must be genuine and included on the list of eligible occupations.

Required documentation

• Certificate of Sponsorship (CoS) issued by the employer
• Employment contract detailing job duties, location, and salary
• Company sponsor licence and supporting documents
• Passport and biometric information from the employee
• Proof of English language proficiency and qualifications (if required)

Post-arrival requirements

• Foreign nationals must register for a Biometric Residence Permit (BRP) within 10 days of arrival.
• Employers must maintain right-to-work checks, update sponsor management systems, and report job changes or early terminations.

Processing times and costs

Once a person has applied for a UK employment visa, the processing time varies, but it typically ranges from three to eight weeks. ​

The fees for an employment visa vary based on the duration of the visa.

• Up to three years: £610​ GBP
• More than three years: £1,220​ GBP

Additional fees, such as the Immigration Health Surcharge (£624 GBP per year) and priority processing fees, may apply. Check with the specific UK consulate or embassy for the most accurate and up-to-date fee structure.

Leave and public holidays

Annual leave and paid time off

Employees in the United Kingdom are entitled to paid vacation leave as soon as they start employment. The statutory entitlement is 5.6 weeks per year for full-time workers, which may include public holidays depending on the employment contract. This leave is fully paid and can be taken throughout the leave year, as agreed between employer and employee.

Additional leave may be offered as part of an employment contract, though it is not required by law. Many employers offer enhanced leave policies to stay competitive and improve retention.

Unused statutory leave may be carried over for up to one year in limited cases, such as long-term sickness. Payment in lieu of unused leave is only permitted upon termination of employment.

Public holidays

Employees are entitled to several paid public holidays that are collectively recognized in England, Wales, Scotland, and Northern Ireland.

• Jan. 1: New Year's Day
• Good Friday • Easter Monday (England, Wales, and Northern Ireland)
• Early May Bank Holiday, which generally is the first Monday in May
• Spring Bank Holiday, also known as the Late May Bank Holiday, the last Monday in May
• Summer Bank Holiday, which for Scotland is recognized as the first Monday in August and for England, Wales, and Northern Ireland is recognized as the last Monday in August
• Dec. 25: Christmas Day
• Dec. 26: Boxing Day Additional public holidays are recognized by Scotland.
• Jan. 2: The second day of the new Gregorian Calendar year
• Nov. 30: St. Andrew's Day Additional public holidays are recognized by Northern Ireland.
• March 17: St. Patrick's Day
• Easter Monday
• July 12: Battle of the Boyne (Orangemen's Day)

Employers are not legally required to provide paid leave on public holidays unless stated in the employment contract. However, most full-time workers receive paid time off or an alternative day of leave.

Public holiday entitlements are included in the statutory 5.6 weeks of annual leave. If employees work on a public holiday, employers may offer extra pay or compensatory leave, depending on the company policy.

Sick leave

Personal and sick leave are governed by the Statutory Sick Pay (SSP) system. Employees earning over £123 GBP per week are entitled to £116.75 GBP per week for up to 28 weeks. The first three days of sick leave are typically unpaid, known as 'waiting days'. Employers may offer enhanced sick pay schemes through employment contracts or collective agreements.

Parental leave

Employers must provide up to 52 weeks of maternity leave, with 39 weeks paid, for eligible employees following the birth or adoption of a child. Employees who have worked for an employer for at least 26 weeks by the 15th week before the expected week of childbirth are eligible for benefits, with written notice provided at least 15 weeks before the due date.​

Hiring and talent management

Commonly recruited roles

Global companies operating in the United Kingdom frequently hire for roles that support financial services, digital operations, and international client engagement. There are multiple roles that are commonly recruited for in the UK.

• Customer support representatives: Handle inquiries and service delivery across UK and global markets
• IT specialists and developers: Manage infrastructure, cloud systems, and software development
• Finance and accounting professionals: Support audits, regulatory reporting, and tax compliance
• HR and administrative coordinators: Facilitate onboarding, payroll, and employee records
• Logistics and procurement analysts: Coordinate supply chain, warehousing, and vendor contracts
• Marketing and digital content specialists: Lead campaigns, analytics, and social media strategy
• Executive assistants: Provide high-level administrative support to senior leadership

As your Employer of Record in the UK, we can help you access experienced, English-speaking professionals and onboard top talent efficiently and compliantly.

Languages

The United Kingdom is a multilingual workplace environment, with English and regional languages used across industries. While English dominates corporate settings, regional languages are widely spoken in government and business sectors, particularly in Wales and Scotland. Workplaces often operate in a bilingual or multilingual manner, depending on the industry and region.​

In corporate sectors like IT and finance, English is the primary language for communication, documentation, and client interactions, especially in multinational companies. Meetings, presentations, and official emails are generally conducted in English, though employees may use regional languages informally.​

In government offices and public sector organizations, English and regional languages are commonly used for internal communication and documentation. The UK recognizes several regional languages, with devolved administrations prioritizing their regional languages — such as Welsh in Wales, Scottish Gaelic in Scotland, and Irish in Northern Ireland.​

The manufacturing and retail sectors rely on local languages for daily operations, especially in labor-intensive industries. Factories, warehouses, and construction sites primarily use English or regional languages, while management-level communication may be in English.​

In customer service, language use depends on clientele. English is common for domestic and international customer support, while many companies also hire speakers of Welsh, Scottish Gaelic, Irish, and other regional languages to cater to regional customers.

Education level

The UK workforce comprises individuals with diverse education levels, ranging from basic schooling to advanced degrees. Education levels vary by industry, job role, and region, with skilled and unskilled workers contributing to different sectors of the economy.

• Unskilled and semi-skilled jobs (agriculture, construction, retail, informal sector): Primary (key stage 2) or secondary (GCSEs)
• Skilled trade and technical jobs (manufacturing, automotive, electrical, construction): Vocational training (NVQ level 3), apprenticeships, BTEC, A-Levels
• Entry-level corporate and service sector jobs (clerical, sales, customer service): Bachelor's degree (BA, BCom, BSc) or A-Levels
• IT and engineering jobs (software development, technical support, research and development): Bachelor's degree (BEng, BSc in computer science, IT, or electronics)
• Finance and business jobs (accounting, banking, consulting, corporate roles): Bachelor's or master's degree (BCom, MBA, ACA, CFA)
• Healthcare and life sciences jobs (medical, pharmaceuticals, biotechnology): Bachelor's or master's degree (MBBS, BDS, BPharm, MSc, MTech in biotechnology)
• Academia and research jobs (education, scientific research, government): Master's or PhD (MA, MSc, MPhil, PhD)

Recruitment trends and hiring considerations

The UK job market in 2025 reflects strong demand in digital services, healthcare, green energy, and skilled trades. Technology, finance, and professional services remain core drivers of hiring, while remote and hybrid work models continue to shape talent acquisition strategies.

Labor shortages in healthcare, construction, and logistics are influencing recruitment incentives and skills development. Employers increasingly seek candidates with digital proficiency, adaptability, and sector-specific qualifications.

Cultural considerations include a preference for merit-based hiring, inclusive policies, and transparent communication. As your local partner, we can help you understand regional hiring norms, salary expectations, and regulatory requirements — ensuring a smooth and compliant recruitment process in the UK.

Workplace culture and business practices

Workplace norms and professional etiquette

Workplace culture in the United Kingdom values professionalism, punctuality, and respectful communication. While organizational hierarchies exist, collaboration and individual initiative are encouraged across most industries.

Hierarchy and authority: Decision-making is often consultative, especially in mid-sized and large firms. Managers are accessible, and open dialogue is welcomed in meetings and team discussions.

Email and phone etiquette: Business emails are typically concise and polite, starting with a greeting and ending with a formal sign-off. Phone calls often include brief introductions before addressing business matters directly.

Meeting etiquette: Punctuality is expected, and agendas are often circulated in advance. Meetings generally follow a structured format with space for input and discussion.

Professional dress code: Attire varies by industry, with formal business wear common in finance and law, and business casual or smart casual prevalent in tech, education, and creative sectors.

Typical working hours and business customs

The standard workweek in the United Kingdom typically consists of 37 to 40 hours, spread over five days, with most employees working Monday to Friday. Standard hours are generally from 9:00 a.m. to 5:30 p.m., including a lunch break. Employees are entitled to at least one full day of rest per week, commonly on Saturday or Sunday.

Remote and hybrid work arrangements have become increasingly common across sectors like finance, tech, and professional services. Employers must ensure that remote employees adhere to working time regulations, receive appropriate rest periods, and are protected under UK employment law.

Flexible working requests are a statutory right for eligible employees and must be considered fairly. Any agreed changes to working hours or location must be confirmed in writing in line with UK labor regulations.

Key HR challenges and compliance risks

The UK's employment laws, including the Employment Rights Act 1996 and the Equality Act 2010, establish a comprehensive framework for employer obligations. Compliance is critical, as violations can lead to significant financial penalties and legal repercussions. Recent legislative developments, such as the Employment Rights Bill, have introduced additional responsibilities for employers. HR teams must remain proactive in updating policies and procedures, especially when transitioning from an EOR model to a fully established local entity.

Professional employer organization (PEO) vs. employer of record (EOR) in the United Kingdom

What is a PEO in the United Kingdom?

A professional employer organization (PEO) in the United Kingdom is a third-party service provider that manages human resources, payroll, compliance, and employee benefits for their workforce.

Challenges with a PEO model

While a professional employer organization (PEO) in the United Kingdom can streamline HR operations through a co-employment model, the client company retains certain legal liabilities. This arrangement typically necessitates establishing a local legal entity and managing aspects such as tax filings and employee benefits.

In contrast, an employer of record (EOR) assumes full legal responsibility for employment, enabling foreign companies to hire in the UK without setting up a local entity. The EOR manages payroll, taxation, compliance with labor laws, and statutory benefits, thereby reducing administrative burdens and legal risks.

EOR as an alternative to PEO

If you're interested in expanding into the United Kingdom and managing evolving employment legislation or complex tax systems are among your top concerns, an employer of record (EOR) may be the best option for achieving your global growth objectives.

An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in the UK — often in as little as two weeks — without having to take on the cost and risk of establishing a local entity.

Safeguard Global has more than 17 years' experience as an EOR in countries around the globe. As an EOR in the UK, we're experts in employment law, payroll administration, and benefits provision, ensuring your business remains compliant and efficient.

Entity setup in the United Kingdom

Setting up a local entity

While employers of record (EORs) provide a quick entry into the United Kingdom, establishing a legal entity is essential for companies planning large-scale operations, direct hiring, and full market control. The decision depends on growth plans, industry regulations, and cost considerations.

Safeguard Global can help you assess your growth plan and objectives and find the solution that best meets your needs. We're the only provider that grows with you.

Entity registration steps and timelines

Establishing a legal entity in the United Kingdom requires several steps, each involving specific documentation and regulatory approvals. The process begins with selecting an appropriate company name and registering it with Companies House, the UK's registrar of companies. Applicants must provide a registered office address in the UK, details of at least one director, and the company's articles of association, which define its internal governance structure.​

Next, companies must prepare key incorporation documents, including the memorandum of association, which outlines the company's objectives, and the articles of association. These documents, along with the registration application, are submitted to Companies House. Upon approval, Companies House issues a certificate of incorporation, confirming the company's legal existence.​

After incorporation, businesses must register for corporation tax with HM Revenue & Customs (HMRC) within three months of commencing business activities. Depending on the nature of the business, companies may also need to register for VAT and PAYE for employee income tax deductions.​

The entire incorporation process in the UK typically takes between 24 hours to a few days, depending on the method of application and the completeness of the submitted documents.​

Comparing EOR vs. entity setup

While EOR is a faster, low-risk option for market entry and small teams, entity setup is better suited for long-term growth and larger workforce expansion.

• When EOR might better suit your needs: • You need to hire employees quickly (one to two weeks).
• You don’t want to set up a legal entity and manage compliance.
• You are testing the UK market before making a long-term commitment.
• You plan to hire fewer than 50 employees in the United Kingdom.
• ou need flexibility without significant investment.

When entity setup might better suit your needs:

• You want full business control and plan to operate long term.
• You need to sign contracts, open bank accounts, and own assets in the United Kingdom.
• You are hiring 50+ employees (EOR costs become unsustainable).
• You operate in a regulated industry requiring local registration.
• You want to protect your intellectual property under UK law.

Global workforce solutions

HR & Benefits solutions in United Kingdom

We offer localized HR and benefits support tailored to UK employment standards. This includes administration of statutory entitlements such as paid leave, pension enrollment, and national insurance contributions. Our services also cover onboarding, policy management, and employee documentation to ensure compliance with UK employment regulations.

Tax & Accounting solutions

Our experts manage PAYE and national insurance submissions, ensure timely income tax withholdings, and support employer obligations under HM Revenue & Customs (HMRC). We also assist with corporate tax filings and ensure all reporting meets UK legal and financial standards.

Global Payments & Payroll Processing

We provide accurate, compliant, and timely payroll processing in GBP and other currencies. Our services cover employee salary disbursement, statutory deductions, and bonus payments — ensuring full adherence to local labor, tax, and banking regulations.

Updated: May 2025

Partner with Safeguard Global as your employer of record and PEO in the United Kingdom

With over a decade of service, we are the longest-serving employer of record and PEO provider in the international market. Organizations around the world rely on EOR, our employer of record solution, to expand and hire in over 170+ countries around the world, quickly and compliantly.

We’ve seen just about every global employment circumstance imaginable—and with our extensive knowledge of local law and culture, we know what it takes to get employment right in the United Kingdom. We provide written contracts in the local language, salaries in the local currency and HR support in your employees’ time zone.

Additionally, as a global payroll provider we support payroll administration—including payments, filings and other calculations— all around the world and can accommodate the payroll outsourcing needs of any size organization.

Whether you’re looking to hire as part of a strategic expansion or to meet specific talent needs, our global solutions advisors can walk you through your international hiring options so you can make the right choice for your organization. Contact us today.

Disclaimer: The information provided on or through this website is for informational purposes only and does not constitute legal advice. Safeguard Global expressly disclaims any liability with respect to warranty or representation concerning the information contained herein, including the lost essence, interpretation, accuracy and/or completeness of the information in transit and language translation.