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Written by Brad Askew
Legal Tech Founder
Civil & Commercial Law background · Founder of LegalDocuments.co.uk
We’re not a law firm — we help you find the right legal support. For advice on your situation, speak to a legal adviser or find a solicitor.
Updated April 2026 · England & Wales
BA
Written by Brad Askew Legal Tech Founder
Civil & Commercial Law background · Founder of LegalDocuments.co.uk
Updated May 2026
·
England & Wales
If you run a business in the UK, getting to grips with employment law is one of those jobs that tends to sit near the bottom of the to-do list until something goes wrong. The rules are wide-ranging, they change regularly, and getting them wrong can cost you far more than getting them right in the first place.
This guide pulls together the main pieces of legislation that shape the employer-employee relationship in England and Wales, from contracts and pay through to dismissal, leave, and workplace safety. It is written for people running small and mid-sized businesses who want a plain-English overview before they dig deeper.
I am Brad Askew, the founder of LegalDocuments.co.uk, and my aim here is to give you a useful starting point rather than a dense legal textbook. Treat this as a map, not a manual.
Overview
Employment law in the UK is the body of statute, regulation and case law that governs the relationship between employers and the people who work for them. It sits across several different Acts rather than in one single code, which is part of what makes it feel complicated.
The main pillars cover how someone is hired, what terms their contract must contain, what they must be paid, how they can be managed day to day, the leave and time off they are entitled to, how disputes are handled, and how the relationship can lawfully be brought to an end. There is also a separate strand dealing with equality and discrimination, which runs through every stage of employment.
Alongside the primary legislation sit codes of practice, tribunal decisions, and guidance from bodies like Acas and the Health and Safety Executive. For most employers, the practical question is not 'what does the law say in the abstract' but 'what do I need to have in place to stay on the right side of it'. That is what the rest of this guide focuses on.
Key steps
01
Get the employment status right. Before anything else, work out whether the person you are taking on is an employee, a worker, or genuinely self-employed. Each category comes with a different set of rights and tax treatments, and getting this wrong is a common source of tribunal claims. The label on the contract does not decide it; the reality of the working arrangement does.
02
Issue a written statement of particulars from day one. Every employee and worker is entitled to a written statement of the main terms of their employment on or before their first day. This should cover pay, hours, holiday, notice, job title, place of work, and other core terms. A well-drafted contract goes further and deals with confidentiality, intellectual property, and post-termination restrictions.
03
Pay at least the statutory minimum and keep proper records. The National Minimum Wage and National Living Wage rates are updated each April and vary by age. You also need to keep accurate records of hours and pay, issue itemised payslips, and operate PAYE correctly. Underpayment, even accidental, can lead to back-pay liabilities and public naming.
04
Manage leave, sickness and family rights properly. Employees have statutory entitlements to paid annual leave, rest breaks, sick pay in qualifying cases, and a range of family-related leave including maternity, paternity, adoption, shared parental and unpaid parental leave. Having clear written policies makes these easier to administer and reduces the risk of disputes.
05
Follow a fair process before dismissing anyone. Unfair dismissal protection generally applies after two years of continuous service, but some reasons, such as dismissal linked to pregnancy, whistleblowing or a protected characteristic, are automatically unfair from day one. Use the Acas Code of Practice on disciplinary and grievance procedures as your baseline and document every step.
Common questions
QWhat is the difference between an employee and a worker?
An employee works under a contract of employment and has the full range of statutory rights, including protection from unfair dismissal after qualifying service. A worker has a narrower set of rights, such as holiday pay and the minimum wage, but usually cannot claim unfair dismissal. Someone who is genuinely self-employed has very limited employment rights. The correct status depends on the facts of the working arrangement rather than the job title.
QDo I have to give every new starter a written contract?
You must provide a written statement of the main particulars of employment to every employee and worker on or before their first working day. This is a legal requirement, not a nice-to-have. In practice, most employers go further and issue a full written contract, which gives you the chance to deal with matters like confidentiality, restrictive covenants and notice periods that the statutory minimum does not cover.
QHow much holiday are staff entitled to?
Full-time workers in the UK are generally entitled to a minimum of 5.6 weeks of paid annual leave each year, which works out at 28 days for someone working a five-day week. Employers can choose whether to include bank holidays within that allowance or grant them on top. Part-time staff receive a pro-rated amount. Specific calculations can get tricky for irregular hours and term-time workers.
QWhen does unfair dismissal protection kick in?
The standard qualifying period for ordinary unfair dismissal claims is two years of continuous employment. However, certain dismissals are automatically unfair from day one, including those connected with pregnancy, trade union activity, whistleblowing, asserting a statutory right, or a protected characteristic under the Equality Act 2010. In those cases there is no minimum service requirement, which is why a fair process matters from the start.
QWhat do I need to do about health and safety as a small employer?
All employers owe a duty to provide a safe place and system of work under the Health and Safety at Work etc. Act 1974. In practical terms that means carrying out risk assessments, putting reasonable control measures in place, providing information and training, and recording your approach. Businesses with five or more employees should have a written health and safety policy. The HSE website has sector-specific guidance worth reading.
QCan I make staff redundant if the business is struggling?
Yes, redundancy is a potentially fair reason for dismissal, but you have to follow a proper process. That includes identifying a genuine redundancy situation, using fair selection criteria, consulting with affected staff, considering suitable alternative employment, and paying the correct statutory or contractual redundancy pay. Where 20 or more roles are at risk at one establishment, collective consultation rules apply and the timescales are strict.
QDoes UK employment law apply to people working from home or abroad?
Employees based in the UK generally keep their employment rights wherever they physically work, including at home. For staff working overseas, the position is more nuanced and depends on factors like where the contract is based, where duties are performed, and the law of the country they are in. Cross-border working also raises tax, immigration and social security questions, so it is worth thinking through carefully before agreeing to it.
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Brad Askew Legal Tech Founder
Brad has a background in civil and commercial law and founded LegalDocuments.co.uk to make clear, reliable legal information accessible to everyone. This site is not a law firm and does not provide regulated legal advice.
Legal disclaimer
This article is for general information only and does not constitute legal advice. We are not solicitors. For advice on your specific situation, please consult a qualified solicitor.
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