One of the greatest challenges facing any new business is how to deal with the UK's complex employment legislation. Employers not only have to understand how to motivate employees but they also need to understand a whole raft of legislation which determines what they can do, when they can do it and how they can do it. These are the essential highlights in a very complex area.

Statutory dismissal procedures
If things go wrong do not rush to dismissal. You can only dismiss initially for gross misconduct, otherwise you will need to warn instead. If you have to dismiss then you must first notify the employee, show them any relevant evidence in advance of a decision being taken and invite them to a disciplinary hearing. You must also give the employee the right to be accompanied. There are heavy penalties in addition to the usual tribunal award of compensation if you do not follow this procedure. The right applies after one year's employment.

Grievance procedures
If an employee raises a grievance you must offer them a meeting to resolve it. Again, they have the right to be accompanied. If you do not offer them a grievance hearing and the matter ends up in a tribunal then there are also heavy penalties in addition to the usual award of compensation.

Discrimination law
This is a minefield. Thankfully, cases of genuine discrimination are rare but misunderstandings frequently give rise to claims. It is unlawful to intentionally or unintentionally discriminate by virtue of a person's sex, race, disability, age, religious/philosophical belief of sexual orientation. If the employee has a complaint they have to raise it with the employer by a grievance before they can bring a tribunal claim. 

Working Time regulations and national minimum wage
Basic legislation such as this shapes the way in which employees can be compelled to work and how they are paid. The Working Time regulations state that an employee must not (unless they consent in writing) work more than 48 hours per week on average and they must also have a break if they work over six hours a day. The National Minimum Wage is self-explanatory: it does of course lay down minimum wages as determined by age. 

Obviously the legislation and case law is vastly detailed and all I have done is provide some signposts. There is much more that I could talk about. Do make sure that you keep abreast of employment law. It could be very costly to your business otherwise.

David Malamatenios is an associate at Colman Coyle LLP. For more information call 020 7354 3000, email david.malamatenios@colmancoyle.com [1] or visit www.colmancoyle.com [2]