How much does a UK-based employee cost?
So you’re thinking of hiring someone in the UK. That’s great! The UK is rich with talented people who come from a diverse range of industries and cultures and will be able to bring vital skills to your team. But what are the costs to your business for hiring an employee in the UK, over and above just your employees’ salaries? Let’s dive into some of the costs and terms you’ll start to hear often as an employer.
For each employee, an employer has to pay a certain percentage on all earnings above a threshold per month towards National Insurance. This cost is on top of the employee’s gross salary.
Pensions are a mandatory benefit for UK-based employees. As an employer, you must have a compliant pension scheme in place in which employer and employee contributions are required unless the employee chooses to opt out.
There are additional benefits which you may want to consider offering your employee, for example, Private Medical Insurance, Life Insurance, or Critical Illness Cover. These will typically incur additional employee-related costs, and through the bench-marking service at Goodwille, we can help you determine what is right to offer your employee based on their experience & the industry in which they work. Check out our video about your responsibilities as a UK employer for more insights and have a chat to the Goodwille team for advice on what might best for your business.