Countrypedia

Hire and manage employees in the United Kingdom

As your Employer of Record (EOR) in the United Kingdom, we’d help you expand by hiring employees and running their payroll without establishing a local branch office or subsidiary.
Last updated:
July 16, 2025
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Table of Contents

General Overview

The United Kingdom is a diverse, service-based economy with strong financial, technology, and creative sectors. Its labor market is regulated by statutory laws and enhanced by collective bargaining, ensuring clear employee rights and employer obligations across various industries.

Employment Contracts

Types: Employers may provide contracts for both fixed-term and indefinite employment.

Requirement: Contracts must be in writing, outlining all terms such as job responsibilities, salary, and conditions.

Probation Period

Duration: Probationary periods can range from 2 weeks to 12 months.

Standard Practice: A 6-month probation is common, though no legal maximum exists.

Working Hours

Payment Cycle: Salaries are paid on the last day of the month via bank transfer only.

Working Time Directive: Although employees may work more than 48 hours in a single week, the average over a 17‑week reference period must not exceed 48 hours per week.

Vacation Days

Entitlement: Employees are entitled to a minimum of 28 days of paid holiday per year (calculated on a pro-rata basis). Bank Holidays do not have to be included as part of the annual leave but may be allocated at the employer’s discretion.

Sick Leave

Statutory Sick Pay (SSP):

  • Paid for up to 28 weeks.
  • Sick pay starts after an employee has been off work for 3 consecutive days (a doctor’s note is required if absence exceeds 7 days).
  • SSP is paid at a minimum of £96.35 per week unless higher rates are agreed in the contract.

Wages and Salary Payment

Payment Date: Salaries are paid on the last day of the month.

Minimum Wage:

  • The National Living Wage is £11.44 per hour for workers aged 23 and over (as of 2024).
  • Rates vary based on age and other factors.

Public Holidays

The UK observes the following public holidays (bank holidays form part of the annual leave entitlement):

  • January 1: New Year’s Day
  • Good Friday and Easter Monday (movable)
  • May 1: Early May Bank Holiday
  • Late May: Spring Bank Holiday
  • Late August: Summer Bank Holiday
  • December 25: Christmas Day
  • December 26: Boxing Day

If a bank holiday falls on a weekend, a substitute weekday (usually the following Monday) becomes a holiday.

Employer Taxes

Pension Contributions: Employers must automatically enroll eligible employees in a workplace pension, with a minimum contribution of 3% of gross salary.

National Insurance: Employers also pay National Insurance contributions at rates that vary by employee earnings and category.

Employee Taxes

Income Tax Bands (England and Wales):

  • Personal Allowance: Up to £12,570 at 0%
  • Basic Rate: 20% for earnings between £12,571 and £50,270
  • Higher Rate: 40% for earnings between £50,271 and £150,000
  • Additional Rate: 45% for earnings over £150,000

Scotland has its own tax bands with slightly different rates.

National Insurance: Employees contribute according to Class 1 rates (e.g., 12% on earnings between £184 and £967 per week and 2% on earnings above £967 per week).

Notice Period

Based on Length of Service:

  • For service of less than 2 years: At least 1 week’s notice.
  • For service between 2 and 12 years: 1 week’s notice for each year of service.
  • For service of 12+ years: Up to 12 weeks’ notice.

Termination and Severance Pay

Termination:

  • Notice must be given in writing, with notice periods as noted above.
  • During the notice period, employees continue to receive their normal salary and benefits.

Severance Pay:

Statutory severance is required only in cases of redundancy for employees with at least 2 years of service.

The statutory formula is:

  • Half a week’s pay per year for employees under 22,
  • 1 week’s pay per year for those aged 22 to 41, and
  • 1½ weeks’ pay per year for employees over 41 (capped at 20 years of service, with weekly pay capped at £525).
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Frequently
Asked
Questions

What is International EOR and PEO?

International EOR (Employer of Record) and PEO (Professional Employer Organization) are services that enable businesses to compliantly hire, manage, and pay employees in foreign countries without the need for establishing a legal entity. EOR acts as the legal employer while PEO co-employs workers, handling administrative tasks such as payroll, taxes, and benefits.

Does Acvian handle time record submissions?

Acvian does not handle time record submissions directly. It is the client’s responsibility to track and submit employee work hours. However, Acvian can offer guidance and best practices to ensure efficient time tracking and compliance with local labor laws.

How can employees view their payroll details?

Employees can view their payroll details through the monthly payslips they receive and also via our Acvian platform. These payslips contain information on earnings, deductions, taxes, and net pay, giving employees a clear overview of their monthly payroll. Please note that in some countries, employers are restricted from viewing payslips due to data protection regulations, and only employees can share their payslips. For more details on these regulations, please contact our specialists.

How Acvian handles payroll disputes?

Acvian addresses payroll disputes promptly, working closely with both the client and the employee to investigate and resolve any issues.

Does Acvian require advanced monthly payments of salaries and service?

Yes, Acvian requires advanced monthly payments for salaries and service to ensure timely and accurate payroll processing.

Can Acvian provide consultations regarding a labor and tax legislation?

Yes, Acvian can provide consultations regarding labor and tax legislation. Our team of experts is well-versed in local regulations and can offer guidance to help your business maintain compliance, reduce risk, and navigate the complexities of international employment and taxation laws.

Which benefits does Acvian provide?

Acvian provides a diverse range of benefits, including but not limited to:

  • Health insurance
  • Car leasing
  • Gym allowance
  • Per diem compensation
  • Maternity leave

We can customize and offer many kinds of benefits requested by the client, ensuring that your employees receive the support and perks that align with your company culture and local regulations.

Can Acvian provide private health insurance?

Acvian can provide private health insurance options as part of its comprehensive employee benefits package.

What would the monthly/yearly costs for the employee be?

The monthly/yearly costs for an ‘average’ package vary depending on the specific plan and location. See our estimated price packages here. Acvian’s team can provide detailed cost breakdowns based on your requirements.

Can Acvian help with entity set up?

While Acvian doesn’t directly provide entity set-up services, we can introduce you to local lawyers who specialize in this area to assist you with your needs. See also, when it's better to set the entity or use the EOR.

Offboarding: how it is handled?

Offboarding is managed by Acvian in a structured and compliant manner. We coordinate with your business to ensure all necessary documentation, exit interviews, and final payments are completed. Acvian also ensures adherence to local labor laws and regulations, including providing any required notice periods and managing the termination process.

When does business need it?

Businesses typically need EOR and PEO services when they:

  • Expand into new international markets.
  • Hire remote employees in foreign countries.
  • Seek to streamline global workforce management.
  • Aim to ensure compliance with local labor laws and regulations.
  • Want to reduce the time and cost of establishing legal entities abroad.

Is Acvian compliant with GDPR?

Yes, Acvian is fully compliant with GDPR regulations. We collect and process personal data in accordance with the law, ensuring that data is used only for general, allowed purposes such as marketing and other legitimate business activities.

Where can Acvian supply EOR services?

Acvian can supply EOR services in over 180 countries, encompassing almost all European nations, the United States, and Canada, providing extensive coverage to support your business’s global expansion and workforce management needs. See our coverage here.

How does payroll work under EOR?

Under EOR, Acvian manages the payroll process by:

  • Acting as the legal employer of your foreign workforce.
  • Handling salary calculations, deductions, and disbursements.
  • Ensuring compliance with local tax and labor laws.
  • Managing payroll taxes, social contributions, and benefits.
  • Providing timely and accurate payroll processing for your employees.

Explore the details here.

Can you provide support for expatriate EOR workers?

Yes, Acvian provides comprehensive support for expatriate EOR workers, including:

  • Visa and work permit assistance.
  • Relocation and housing support.
  • Local registration and compliance.
  • Payroll and tax management.
  • Coordination of benefits and insurance coverage.

Explore in details here.

What are the details of expats support?

Expats support from Acvian encompasses a range of services designed to facilitate a smooth transition for employees working abroad. Key aspects include:

  • Assistance with visa and work permit applications, renewals, and compliance.
  • Support for relocation, including housing, schooling, and local registration.
  • Guidance on local tax regulations and filings.
  • Coordination of locally compliant benefits and insurance coverage.
  • Ongoing support for any changes or issues that may arise during the expatriate assignment.

What happens after onboarding?

After onboarding, Acvian maintains an ongoing relationship with your business and employees, ensuring smooth payroll processing, managing tax and regulatory compliance, handling benefits administration, and providing support for any changes or issues that may arise in the employment lifecycle. This allows you to focus on your core business operations while Acvian manages your international workforce.

How many days will it take for our personnel to be onboarded?

The onboarding process typically takes between 2 to 4 weeks, depending on the country and complexity of the employee’s situation. However, Acvian strives to expedite this process, ensuring a smooth and efficient transition for your personnel. See our story of the urgent employment project.

Does Acvian provide in-country support for employee inquiries or assistance requests?

Yes, Acvian provides in-country or regional support for employee inquiries and assistance requests. We have dedicated managers in the countries where we support your employees, ensuring prompt and knowledgeable assistance tailored to local regulations and practices.

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