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United Kingdom

Introduction
 

General overview & country facts, as well as labour regulations.
Employer Contributions
 

These are additional costs incurred by employers over and above the employee’s monthly gross salary and/or bonus.
Employee Contributions
 

These are costs incurred by employees that reduce their monthly gross salary and/or bonus to determine their net “take home” pay.
Employment Terms
 

All you need to know about salary & bonuses, working hours & overtime, probation period, notice period & severance pay, as well as all leave types.

COUNTRY PLAYBOOK

United Kingdom
Everything you need to know about payroll, benefits & hiring top talent in United Kingdom

Currency

Pound Sterling (GBP)

Salary payment frequency

Monthly

Capital

London

Time Zone

GMT

Official Languages

English

Is English spoken?

Yes
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UK | Global Employment

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general facts | Image | Playroll | Employer of Record | international payroll
Introduction
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Employer Contributions
employee contributions | Image | Playroll | Employer of Record | international payroll
Employee Contributions
employment terms | Image | Playroll | Employer of Record | international payroll
Employment Terms
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Introduction

General Overview & Economic Facts
  • The United Kingdom (UK) is the collective name for England, Scotland, Wales and Northern Ireland
  • It is a sovereign country located off the north­western coast of the European mainland
  • The UK spans an area of 242 495 km² (93 627,8 sq mi) and has a total population of approximately 67.22 million
  • The United Kingdom has the world’s 5th largest economy by nominal GDP (2021) and the 10th largest by PPP (2021)
  • The UK has a high-income economy and a high human development index rating, ranking 14th in the world
Why Employ In United Kingdom?
  • The main exports from the UK include cars, gas turbines and crude petroleum
  • 11.49% of the population is between the ages of 15 and 24 years, with 39.67% of the population being between the ages of 25 and 54. The UK has a mix of a fairly youthful population, making it a favourable country to employ young, energetic employees, as well as a good country to hire more experienced employees
Overview Of The Labour Law
  • Employees in the UK benefit from certain minimum legal rights. These rights are found in various Acts, Regulations, common law and equity
  • The rights cover rules regarding minimum wage, paid holidays, break from work, working hours, occupational pension and provisions for leave
  • Collective bargaining agreements also play a role
Fun Country Facts
  • Llanfairpwllgwyngyll-gogerychwyrndrobwlllllandysiliogogogoch, a city in Wales, is the longest name of any city in the world
  • The 1st King of England made a law that everyone had to be in bed by 8pm
  • There are more chickens in England than people
Why Use Playroll Services For United Kingdom?
  • Employing in the UK requires companies to have their own legal entity in the country as well as managing payroll, employee benefits, taxes and legal compliance. This can get quite complicated, especially with the complexity of employment laws in the UK
  • With Playroll’s Employer of Record services, your team will be employed by our established legal entities in each country
  • We will take care of payroll, employee benefits, taxes, legal compliance and provide ongoing employee support, so that you can focus on growing a thriving team
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Employer Contributions

These are additional costs incurred by employers over and above the employee’s monthly gross salary and/or bonus.

National Insurance (NI)

Calculated on total monthly earnings
NI contribution is determined by the employee’s category:

A- all employees except those in the categories below

B- married women/widows entitled to pay reduced NI

C- employees over the State Pension age

H- an apprentice under the age of 25

J- employees who can defer NI due because they’re paying it in another job

M- employees under the age of 21

Z- Employees under the age of 21 who can defer NI due because they’re paying it in another job

Class A employees – All employees except those in the categories below

Earnings between £ 520.00 – 737.00
0.00%

Earnings between £ 737.00 – 4189.00
13.80%

Earnings over £ 4189.00
13.80%

Class B employees – married women/widows entitled to pay reduced NI

Earnings between £ 520.00 – 737.00
0.00%

Earnings between £ 737.00 – 4189.00
13.80%

Earnings over £ 4189.00
13.80%

Class C employees – employees over the State Pension age

Earnings between £ 520.00 – 737.00
0.00%

Earnings between £ 737.00 – 4189.00
13.80%

Earnings over £ 4189.00
13.80%

Class H employees – an apprentice under the age of 25

Earnings between £ 520.00 – 737.00
0.00%

Earnings between £ 737.00 – 4189.00
0.00%

Earnings over £ 4189.00
13.80%

Class J employees – employees who can defer NI due because they’re paying it in another job

Earnings between £ 520.00 – 737.00
0.00%

Earnings between £ 737.00 – 4189.00
13.80%

Earnings over £ 4189.00
13.80%

Class M employees – employees under the age of 21

Earnings between £ 520.00 – 737.00
0.00%

Earnings between £ 737.00 – 4189.00
0.00%

Earnings over £ 4189.00
13.80%

Class Z employees – Employees under the age of 21 who can defer NI because they’re paying it in another job

Earnings between £ 520.00 – 737.00
0.00%

Earnings between £ 737.00 – 4189.00
0.00%

Earnings over £ 4189.00
13.80%

Pension Fund

Calculated on total monthly earnings.

Earnings between £ 0.00 – 520.00
0.00%

Earnings between £ 520.00 – 4189.00 
3.00%

Apprenticeship Levy

Employers with a total salary bill of GBP 3 million per annum must contribute 0.5% of the value to hiring apprentices or developing existing staff.

0.50% 

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Employee Contributions

These are costs incurred by employees that reduce their monthly gross salary and/or bonus to determine their net “take home” pay.

National Insurance (NI)

Calculated on total monthly earnings
NI contribution is determined by the employee’s category:

A- all employees except those in the categories below

B- married women/widows entitled to pay reduced NI

C- employees over the State Pension age

H- an apprentice under the age of 25

J- employees who can defer NI due because they’re paying it in another job

M- employees under the age of 21

Z- Employees under the age of 21 who can defer NI due because they’re paying it in another job

Class A employees – all employees except those in the categories below

Earnings between £ 520.00 – 797.00
0.00%

Earnings between £ 797.00 – 4189.00
12.00%

Earnings over £ 4189.00
2.00%

Class B employees – married women/widows entitled to pay reduced NI

Earnings between £ 520.00 – 797.00
0.00%

Earnings between £ 797.00 – 4189.00
5.85%

Earnings over £ 4189.00
2.00%

Class C employees – employees over the State Pension age

Earnings between £ 520.00 – 797.00
0.00%

Earnings between £ 797.00 – 4189.00
0.00%

Earnings over £ 4189.00
0.00%

Class H employees – an apprentice under the age of 25  

Earnings between £ 520.00 – 797.00
0.00%

Earnings between £ 797.00 – 4189.00
12.00%

Earnings over £ 4189.00
2.00%

Class J employees – an apprentice under the age of 25  

Earnings between £ 520.00 – 797.00
0.00%

Earnings between £ 797.00 – 4189.00
2.00%

Earnings over £ 4189.00
2.00%

Class M employees – employees under the age of 21  

Earnings between £ 520.00 – 797.00
0.00%

Earnings between £ 797.00 – 4189.00
12.00%

Earnings over £ 4189.00
2.00%

Class Z employees – Employees under the age of 21 who can defer NI because they’re paying it in another job  

Earnings between £ 520.00 – 797.00
0.00%

Earnings between £ 797.00 – 4189.00
2.00%

Earnings over £ 4189.00
2.00%

Pension Fund

Earnings between £ 0.00 – 520.00
0.00%

Earnings between £ 520.00 – 4189.00
5.00%

Income Tax

Income Tax is ‘Pay As You Earn’
Federal tax of 30% is applied on vacation premium exemptions, grocery coupons, and Christmas bonuses. Income tax varies by territory in the UK

Income bracket per annum 

0.00 – 12,570.00
0.00%

12,571.00 – 50,270.00
20.00%

50,271.00 – 150,000.00
40.00%

150,000.00 or more
45.00%

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Employment Terms

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General

Minimum Wage
  • Age 23 or older- £ 9.50 per hour
  • Age 21 – 22- £ 9.18 per hour
  • Age 18 – 20- £ 6.83 per hour
  • Age 18 or younger- £ 4.81
  • Apprentice- £ 4.81
Working Hours
  • Maximum of 8 hours per day, 40 hours per week for employees 17 years or younger and a maximum 48 hours per week for employees 18 years and older
  • Minimum meal interval of 20 minutes if working for more than 6 hours a day
  • Typical working hours are 09h00 to 17h30 Monday to Friday
Overtime
  • There is no statutory maximum overtime
Notice Period
  • There is no statutory notice period
  • It is common to have notice periods based on the employees duration of employment:

– Employed between 1 and 24 months- 1 weeks’ notice

– Employed between 24 and 36 months- 2 weeks’ notice

– Employed between 36 and 48 months- 3 weeks’ notice

– Employed between 48 and 60 months- 4 weeks’ notice

– Employed between 60 and 72 months- 5 weeks’ notice

– Employed between 72 and 84 months- 6 weeks’ notice

– Employed between 84 and 96 months- 7 weeks’ notice

– Employed between 96 and 108 months- 8 weeks’ notice

– Employed between 108 and 120 months- 9 weeks’ notice

– Employed between 120 and 132 months- 10 weeks’ notice

– Employed between 132 and 144 months- 11 weeks’ notice

– Employed for 144 months or more- 12 weeks’ notice

Severance Pay
  • Severance pay is payable for every full year of employment: 

– Age 21 and younger- 50% of 1 weeks’ pay

– Age 22 to 40- 100% of 1 weeks’ pay

– Age 41 and older- 150% of 1 weeks’ pay

      Probation Period
      • There is no statutory probationary period
      • It is common to have a probation period between 3 and 6 months
      Bonus
      • There is no statutory bonus 
      Public Holidays

      Public Holidays England and Wales 2023

      • January 1st – New Year’s Day
      • January 2nd – New Year’s Day (substitute day)
      • April 7th – Good Friday
      • April 10th – Easter Monday
      • May 1st – Early May Bank Holiday
      • May 8th – Bank holiday for the coronation of King Charles III
      • May 29th – Spring Bank Holiday
      • August 28th – Summer Bank Holiday
      • December 25th – Christmas Day
      • December 26th – Boxing Day

       

      Public Holidays Scotland 2023

      • January 2nd – New Year’s Day
      • January 3rd – 2nd January
      • April 7th – Good Friday
      • May 1st – Early May Bank Holiday
      • May 8th – Bank holiday for the coronation of King Charles III
      • May 29th- Spring Bank Holiday
      • August 7th – Summer Bank Holiday
      • November 30th – St Andrew’s Day
      • December 25th – Christmas Day
      • December 26th – Boxing Day

       

      Public Holidays Northern Ireland 2023

      • January 1st – New Year’s Day
      • January 2nd – New Year’s Day (substitute day)
      • March 17th – St Patrick’s Day
      • April 10th – Easter Monday
      • May 1st – Early May Bank Holiday
      • May 8th – Bank holiday for the coronation of King Charles III
      • May 29th – Spring Bank Holiday
      • July 12th – Battle of the Boyne (Orangement’s Day)
      • August 28th – Summer Bank Holiday
      • December 25th – Christmas Day
      • December 26th – Boxing Day
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      Leave

      Paid Leave / Vacation Days
      • Minimum of 28 days per year 
      Sick Leave
      • Paid leave
      • Paid by employer 
      • 28 weeks per year 
      Maternity Leave
      • Paid leave
      • Paid by employer 
      • Minimum of 26 weeks per year and a maximum of 52 weeks per year 
      Paternity Leave
      • Paid leave
      • Paid by employer 
      • Minimum of 2 weeks per year 
      Parental Leave
      • Unpaid leave 
      • 4 weeks per child per year 
      Family Responsibility Leave
      • Unpaid leave 
      • Unlimited leave 
      Short-Term Care Leave
      • Unpaid leave 
      • Unlimited leave 
      Start hiring in United Kingdom today!