Employment query

[Sandybun]

We are thinking of hiring someone for around 6 hours a week to engage in play / educational activities with our 3-yr-old daughter who has autism. We were going to pay around £8 per hour.

We have never employed anyone before, and are a bit in the dark about how complicated it might potentially be. We are on a tight budget, and I'm just wondering what the real cost is likely to be in terms of employer contributions and NI liability, etc.? I've had a brief look at the HMRC website, and from that I think we seem to be below the lower earnings limit for PAYE, NI, SML and SSL. Is that correct? And what about holiday entitlement? Presumably we would have to offer that?

My other fear is that, for some reason, the employment won't work out and we might have to bring it to an end. Can anyone give me information about trial periods are lawful or not? Or the other thing we were thinking of doing was offering a 6 month temporary contract to see how it goes? All advice much appreciated.

If anyone can recommend a good basic website where I could get a template contract, I'd be very grateful.

can you not call the role a tutor role and then it will be upto whover you employ to declare their income. I have employed tutors before for my autistic daughter for exactly the same reason and it was always on a self employed basis.

If this person is going to be running educational play with your daughter and is using specific skills to do this, it is likely she could (and would expect to) do this on a self employed basis.

If there is any uncertainty, you will need to get a ruling from HMRC.

If (s)he is employed then yes you need to give 5.6 weeks paid holiday. (S)he will be below the level of NI (£107pw from April) and SSP, SMP etc., although every employee is potentially entitled to Statutory Maternity Leave (i.e. the right to return to their job).

BUT if the new employee already has another job you will have to operate PAYE and deduct tax at the basic rate from everything you pay - see here.

If it is not working out you can terminate a contract of employment within the first year simply by giving notice in accordance with the contract (which must not be less than one week). It is common for the notice period to be 1 week for the first 1-3 months and 1 month thereafter. Trial period is not the correct term for this, it is sometimes called a probationary period but you don't need to call it anything.

cansu managed to phrase my first paragraph in a much more simple way!

Thanks! I might contact HMRC to see what they say about it.

It would certainly be easier for us if she was acting as self-employed. In such an event, would I still need to draw up a contract or could I leave that up to her?

Do you get direct payments? They could help to pay for a buddy for your daughter as 'respite' for you as a carer.

Have a look here:
www.direct.gov.uk/en/CaringForSomeone/MoneyMatters/DG_10018517

Thanks! I wasn't aware of that, will look into it.

We've just placed a nanny / tutor in a similar capacity and they will be working on a self employed basis, as advised by HMRC!

Whilst it may seem a good idea to have a self-employed tutor, I would wonder how much that would cost, as a tutor in my view going to be wanting to provide the service for £8 an hour.

If you don't need someone with specialist training, then a part-time nanny on payroll might work out cheaper, depending on the salary you agree with them.

For example, if you agreed £8 gross an hour - 6 hours a week

(2012/13 tax year payroll calculations with thanks to MrAnchovy.com/calc/paye201213

Employees Taxcode: BR
Gross Annual: £2503
Employee Income Tax: £501
Employee National Insurance: £0
Net Pay: £2002
Employers NI: £0
Cost to Employer: £2503

If you didn't want to do the payroll yourself using the tools provided by HMRC, then add in a cost of say £125 for payroll admin... giving £2628

Where as if a tutor charged £10 per hour, you might be paying £60 a week for 48 weeks, thus £2880.

Direct Payments could be used to help pay for a tutor perhaps, see NAS: Direct Payments Guide. Also contact your local NAS Branch for support and information, including often the loan of books from the branch library - a branch local to me has books I brought on , for loan out to members.

How did I miss several words from that - think my brain works faster than I type.

as a tutor in my view is going to be wanting to provide the service for more than £8 an hour.

Not sure I follow you there Nick, someone with the right skills is going to want £X per hour whether it is PAYE or self employed (I suppose they might accept a slightly lower rate PAYE because they wouldn't have to pay Class 4 NI but this is offset by the hassle of payroll).

Suppose my thinking is that perhaps someone with the right skills isn't needed, as the OP didn't say they wanted an ABA tutor.

They just want someone to do a few hours play.

With autism, I feel that one of the key things is having someone who the child relates to, who the child will interact with. It may not be someone who has any special training in play/education for children on the autistic spectrum. Instead it could just be a someone with childcare experience.

Also, the budget level I feel is low if they did want someone who is a specialist.

With PAYE comes employer responsibilities that you might want to avoid?!