Do you want to hire an employee in the UK without a permanent establishment but need an English payroll? IPS can help you hire and pay employees in England in compliance with the law, even without an English branch or permanent establishment.

There are 2 ways you can hire someone in England without a permanent establishment:

  1. Employer of Record (England) – this is where your employee is employed directly by us and deployed to you full time. This is also known as employee leasing in England or Umbrella Company in UK.
  2. Direct employment in your company but with payroll accounting according to English law by registering your company as a foreign employer.

Both employment options offer their advantages and disadvantages. Contact us to find out which one suits your project better. We will be happy to advise you and find the best solution for your company.

IPS is your global payroll solution for a successful and fast international expansion without a permanent establishment.

Remote Work Full Time from England – Information for Hiring Employees in England

To ensure that you succeed in your first go abroad, IPS as your international payroll partner is here to assist you with the correct employment of your employees in England and the preparation of English payroll in accordance with the laws of the country. Following is some information to help you understand the English payroll system.

Wage costs

Employer costs in England vary according to the personal situation of the employee and range from 15% to 18% on top of the gross salary.

If you do not have an office in England, you will need a service like IPS to calculate and pay these additional employer costs correctly according to English law.

With international payroll in England from IPS, you can ensure that your employee is paid compliantly according to English law.

International payroll services in England require compliance with English employment law.

As your international payroll service in England, we make sure you are equipped with the information you need. 


If an employee in England falls ill, the first 3 days do not have to be paid. Only from the fourth day onwards is the employee entitled to the so-called Statutory Sick Pay (SSP). This is a set amount per week paid to the employee for 28 weeks. The employer is reimbursed for this by the state. A sick bill or the so-called “fit bill” does not have to be presented until after 7 days.

Vacation and public holidays

In England, each employee is entitled to 28 working days of paid vacation. Normally, the 8 public holidays are included in this amount.

There are 8 public holidays in England. If a public holiday falls on a weekend, the following Monday is considered a “substitute holiday”.

  • January 1
    New Year’s Day
  • Good Friday
  • Easter Monday
    (in England and Wales and Northern Ireland, but not in Scotland)
  • First Monday in May
    May Day
  • Last Monday in May
    Spring Bank Holiday
  • Last Monday in August
    Summer Bank Holiday
  • December 25
    Christmas Day
  • 26 December
    Boxing Day

Probationary period/termination

In England, the length of the probationary period can vary, but is usually around six months.

During the first two years of employment, an employee in England can be terminated without good cause. After two years, you need good cause to terminate the employment relationship.

The statutory notice periods are:

  • a notice period of at least one week for employment of one month up to 2 years

  • a one-week notice period for each year of employment for a period of 2 to 12 years

  • 12 weeks’ notice for a period of employment of 12 years or more.

A longer notice period can be agreed in the employment contract.

As your international payroll company in the UK, we will ensure that you comply with the legal framework when giving notice.

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