A UK employer of record employs your hire through a British entity, issues an employment contract that meets UK statutory minimums, runs PAYE payroll, and pays the employer National Insurance and pension contributions that sit on top of gross salary. The buyer directs the work; the EOR carries the legal employer obligations. The UK is one of the easier major markets to employ in, with no works councils and comparatively flexible dismissal law, but the statutory floor is real and specific: paid holiday, notice ladders and employer National Insurance are set by law, and the figures below come from the UK government's own guidance. Nothing here is legal or tax advice; contracts and current law control.
What a UK EOR does
A compliant UK EOR contracts the employee, registers the employment for PAYE with HMRC, withholds income tax and employee National Insurance at source, pays employer National Insurance on top of salary, auto-enrols the employee into a workplace pension, and administers statutory leave and sick pay. It must also verify the employee's right to work in the UK before employment begins, since that duty falls on the employer. For a company outside the UK with one or a few British hires, the EOR replaces incorporating a UK entity, registering as an employer and running a PAYE scheme, and its fee is priced against exactly that avoided overhead.
The statutory floor: holiday, notice and hours
Almost all UK workers are legally entitled to 5.6 weeks of paid holiday per year, which is 28 days for someone on a five-day week; the statutory entitlement is capped at 28 days, and bank holidays do not have to be paid leave on top unless the contract says so. Statutory minimum notice from the employer scales with service: at least one week after one month of employment, one week per year from two to twelve years, and twelve weeks beyond that; notice pay is based on average earnings over the twelve weeks before notice starts. Contracts routinely improve on these floors, and a UK EOR's template should state the enhanced terms explicitly rather than leaning on the minimum.
What UK employment costs on top of salary
The main statutory on-cost is employer National Insurance: for the 2026-27 tax year, category A employers pay 15% on earnings above the secondary threshold, which sits at £96 to £481 per week depending on category, equivalent to £417 to £2,083 a month. Employees separately pay 8% on weekly earnings between £242.01 and £967 and 2% above that, withheld through PAYE. Workplace pension auto-enrolment adds an employer contribution on qualifying earnings, and holiday and sick pay liabilities sit inside salary rather than on top. A UK EOR quote should show gross salary, employer NI at 15%, pension contribution and its own fee as separate lines; a single blended number hides the one line you can actually negotiate.
What to check in a UK EOR provider
Confirm which UK entity will be the employer on the contract and that it operates its own PAYE scheme rather than routing employment through an umbrella arrangement, since umbrella structures have drawn sustained HMRC attention. Ask to see the contract template's notice terms against the statutory ladder, one week per year of service from two to twelve years, and how the provider handles the right-to-work check, which must happen before day one. Ask how holiday is tracked against the 5.6-week entitlement and what happens to accrued but untaken leave at termination, because that liability lands in the final invoice. Finally, ask whether the quoted employer NI uses the current year's 15% rate and thresholds, since these change at the April tax year boundary.
Questions people ask about uk employer of record
How much National Insurance does a UK employer pay?
For 2026-27, category A employers pay 15% on earnings above the secondary threshold, which the government lists at £96 to £481 per week depending on category letter. This is the single largest statutory cost on top of gross salary in a UK EOR invoice.
How much paid holiday must a UK employee receive?
5.6 weeks per year, which is 28 days on a five-day week and pro rata for part-time workers; the statutory entitlement caps at 28 days and bank holidays can be counted inside it unless the contract grants them on top.
What notice must a UK employer give?
At least one week after one month of service, one week per full year from two to twelve years, and twelve weeks at twelve years or more. Notice pay is based on the average of the twelve weeks of earnings before notice starts, and contracts may set longer periods.
Does using a UK EOR avoid employer National Insurance?
No. The EOR pays it as the legal employer and passes it through on the invoice. Any provider suggesting the 15% employer charge can be structured away is describing risk, not savings.