How to hire your first cleaner: employment law, PAYE and what to pay in 2026

Growing your cleaning business to the point where you need extra hands is a milestone. But the step from sole trader to employer is one of the most legally consequential moves a small business owner makes. The rules around employment status, PAYE, right to work checks and written contracts are not optional extras — they are obligations that apply from day one, regardless of how small your business is or how informal the arrangement feels.

This guide covers everything you need to know about hiring your first cleaner in the UK in 2026: how to classify them correctly, what to have in place before they start, what to pay them, and how to stay on the right side of HMRC and the employment tribunals.

Employee vs self-employed: why HMRC is watching cleaning businesses closely

The most important decision you make when taking on a new cleaner is whether they are an employee or a genuinely self-employed subcontractor. HMRC looks at cleaning businesses carefully in this area because the sector has a long history of misclassification — owners treating workers as self-employed when, in substance, the relationship is one of employment.

The consequences of getting this wrong fall almost entirely on the employer. If HMRC determines that someone you treated as self-employed was actually an employee, you can be held liable for all the income tax and National Insurance contributions that should have been deducted under PAYE — plus interest and penalties. Back-dated NI liabilities on a single worker over two or three years can run to thousands of pounds.

HMRC's employment status tests for cleaners

HMRC applies the same framework to cleaning as to any other sector, but the practical questions are sharply relevant to how cleaning businesses operate day to day:

• Control: Do you tell the cleaner when to work, where to work, and how to do the job? If you set their schedule, allocate their clients and supervise their methods, that points strongly to employment.
• Substitution: Can the cleaner send someone else to do their work without your approval? Genuinely self-employed workers have an unfettered right of substitution. If in practice they always turn up themselves and you would not accept a substitute without vetting them, that points to employment.
• Mutuality of obligation: Are you obliged to offer work and are they obliged to accept it? A cleaner on a fixed weekly schedule with no right to turn down jobs is almost certainly an employee.
• Equipment: Do they use your mop, bucket, vacuum and cleaning products? Self-employed contractors typically supply their own tools and materials. If your cleaner works entirely with your equipment, that points to employment.
• Financial risk: Does the cleaner bear any financial risk? A self-employed person can make a profit or a loss. Someone paid a fixed hourly rate with no exposure to bad debts or business costs is more likely to be an employee.
• Exclusivity: Do they work only for you? A self-employed contractor should be free to — and typically does — work for multiple clients. A cleaner working exclusively on your jobs, week after week, looks like an employee.

No single factor is conclusive. HMRC looks at the overall picture. But if most of the above point toward employment, the relationship is employment, regardless of what the written agreement says.

When subcontracting is genuinely legitimate

Genuine subcontracting is entirely lawful. If you take on a specialist who supplies their own equipment, sets their own schedule, works for other cleaning businesses and invoices you as a business, the relationship can properly be self-employment. Likewise, if you bring in another cleaning operator on an occasional basis to cover capacity — someone who is themselves running a business — that can be subcontracting.

The test is substance, not labels. Calling someone a "subcontractor" in writing while treating them operationally as an employee carries full employment law risk.

What you must have in place before hiring

Before your first employee's first day, five things must be in place. None of them can be dealt with after the fact if something goes wrong.

1. Employer's liability insurance. This is a legal requirement under the Employers' Liability (Compulsory Insurance) Act 1969. You must hold a minimum of £5 million of cover. The insurance must be in force from the moment your employee starts — not from your next policy renewal. The fine for failing to have it is up to £2,500 per day.
2. PAYE registration with HMRC. You must register as an employer and obtain your employer PAYE reference number before you pay your first employee. Registration is done through your HMRC online account. Allow up to five working days for the reference to arrive.
3. A written employment contract (statement of particulars). Employees have a legal right to a written statement of their principal employment terms from day one of employment. This is not a recommendation — it is a legal right under the Employment Rights Act 1996. We cover what must be included in the contract section below.
4. A right to work check. You must check every employee's right to work in the UK before they start. We cover this in detail in the next section.
5. A basic health and safety risk assessment. The Management of Health and Safety at Work Regulations 1999 require you to carry out a suitable and sufficient risk assessment for your employees' work. For a cleaner, this means identifying the hazards in their role — chemical exposure, manual handling, working at height for window cleaners — and putting controls in place. You do not need a lengthy document, but you need evidence that you have thought through the risks.

Right to work checks

Every employer in the UK must check that each employee has the legal right to work before they start. This applies regardless of the employee's nationality or how long you have known them. Failing to carry out the check — or carrying it out incorrectly — does not protect you from liability. The civil penalty for knowingly or negligently employing someone without the right to work is up to £60,000 per illegal worker following increases introduced in January 2024, up from £20,000.

What documents you need to see

For British and Irish citizens, you need to check one of the following original documents in person (or via an approved identity service provider):

• A current UK or Irish passport
• A UK birth or adoption certificate plus proof of National Insurance number (payslip, P60, NI card, HMRC letter)
• A certificate of registration or naturalisation as a British citizen

For EU, EEA or Swiss nationals who have status under the EU Settlement Scheme, you cannot ask to see a physical document — they do not receive one. Instead, you must use the Home Office's online right to work checking service.

Whatever documents you check, you must keep a copy (physical or digital) for the duration of employment and for two years after employment ends. The copy must be dated to show when the check took place.

For employees whose right to work is time-limited — on a visa, for example — you must carry out follow-up checks before their permission expires. Set a reminder well in advance.

What to pay in 2026

The National Living Wage (NLW) increased to £12.21 per hour for workers aged 21 and over in April 2026. This applies to employees across the whole of the UK — England, Scotland, Wales and Northern Ireland. There is no regional variation in the legal minimum wage, though some employers in higher-cost areas such as London choose to pay the voluntary London Living Wage, which sits above the NLW.

The full rate structure for 2026 is:

Paying below these rates is a criminal offence. HMRC enforces minimum wage compliance and names employers who underpay on its public register. The most common breach in cleaning is failing to account for unpaid travel time between jobs, or deducting the cost of uniforms and equipment from pay in ways that bring effective hourly pay below the minimum.

The true cost of employing a cleaner

The gross wage is only part of the cost. When you hire an employee, you also pay employer National Insurance contributions and accrue a holiday pay liability. Here is the full calculation for a cleaner working 25 hours per week at the National Living Wage:

• Gross pay: 25 hrs × £12.21 × 52 weeks = £15,873/year
• Employer NI: 15% on earnings above the secondary threshold of £5,000 = (£15,873 − £5,000) × 15% = £1,630.95/year
• Holiday pay: 5.6 weeks' statutory entitlement = 12.07% of hours worked = approx. 155 hours × £12.21 = ~£1,893/year in equivalent cost
• Total employer cost: approximately £19,400/year

That gap — £15,873 in wages versus ~£19,400 total employer cost — is the figure that catches many first-time employers out. Budget for the full cost, not just the wage.

The table below shows the total employer cost at three different weekly hours, all at the NLW rate of £12.21:

These figures use the 2026/27 employer NI rate of 15% above the £5,000 secondary threshold. Holiday accrual is calculated at 12.07% of pay (5.6 weeks divided by 46.4 working weeks). Pension contributions are not included in these figures — see the pension section below.

Setting up PAYE

PAYE — Pay As You Earn — is the system through which you deduct income tax and National Insurance from your employees' pay and pass it to HMRC. You must operate PAYE if you pay any employee above the Lower Earnings Limit (£123 per week in 2026/27) or if you pay any employee at or above the NLW.

The process for setting up PAYE as a new employer is:

1. Register as an employer with HMRC. Do this through your Business Tax Account at gov.uk/register-employer. You will need your business name, business type and the date you expect to first pay an employee. Allow up to five working days for your employer PAYE reference to arrive by post.
2. Get payroll software. You need payroll software to calculate deductions and submit Real Time Information (RTI) reports to HMRC. HMRC provides a list of approved software. Some accounting platforms include payroll. Cadi includes payroll tracking with RTI deadline reminders to keep you on time.
3. Collect a starter checklist from your employee. Before their first pay run, you need their name, address, National Insurance number and starter declaration (which determines their tax code). Use the HMRC starter checklist form.
4. Submit a Full Payment Submission (FPS) on or before each payday. This is the RTI requirement — you must tell HMRC about every payment to every employee on or before the date of payment. Late FPS submissions attract penalties.
5. Pay HMRC by the 19th (cheque) or 22nd (online) of the month following the tax month. Tax months run from the 6th of one month to the 5th of the next. What you pay is the total income tax and National Insurance deducted from employees, plus your employer NI contributions.

If you run weekly pay, you submit a weekly FPS. Monthly pay means a monthly FPS. The RTI obligation applies even if no tax is due in a period — in that case, you submit a nil FPS or an Employer Payment Summary (EPS).

What must be in the employment contract

Employees have a statutory right to a written statement of employment particulars from their first day of employment. This is not discretionary — it is a legal requirement under the Employment Rights Act 1996. Failing to provide it gives the employee grounds to raise a complaint at an employment tribunal.

The statement must include, as a minimum:

• Job title and job description — what the role is and what it involves
• Start date and whether any previous employment counts toward continuity of service
• Pay rate and pay period — the hourly rate and whether it is paid weekly or monthly
• Hours of work — the normal working hours, days of the week and whether they vary
• Holiday entitlement — the statutory minimum is 5.6 weeks per year (28 days for a full-time worker), including bank holidays
• Notice period — statutory minimum is one week per year of service up to 12 weeks; you can offer more but not less
• Place of work — the address or addresses where work is performed, or a statement that the employee will work at various locations
• Sick pay policy — whether you pay company sick pay above Statutory Sick Pay (SSP), and for how long
• Pension — whether there is a workplace pension scheme and the auto-enrolment rules that apply
• Collective agreements — whether any affect the terms of employment (rare in small cleaning businesses)
• Disciplinary and grievance procedures — or a reference to where these can be found

For a cleaning business, the contract also needs to address practical matters: the requirement to wear PPE where provided, confidentiality of client details (clients' homes and security codes), what happens if a client cancels, and any probationary period.

Auto-enrolment: the basics

If your employee is aged between 22 and 67 and earns more than £10,000 per year, you are legally required to automatically enrol them in a qualifying workplace pension scheme. This obligation applies from their first day of employment — you do not need to wait for them to ask.

The minimum contributions under auto-enrolment are:

• Employer contribution: 3% of qualifying earnings
• Employee contribution: 5% of qualifying earnings (including tax relief)
• Total minimum: 8% of qualifying earnings

Qualifying earnings are calculated on the band between the lower earnings threshold (£6,240/year) and the upper earnings limit (£50,270/year). For a part-time cleaner earning £15,873 per year, the qualifying earnings are £15,873 − £6,240 = £9,633. Your minimum employer contribution is 3% of £9,633 = £289/year.

You must choose a pension scheme. Nest (National Employment Savings Trust) is the government-backed scheme available to all employers at no additional charge — it was created specifically for small employers who may not be accepted by commercial pension providers. Most small cleaning businesses use Nest when first auto-enrolling employees.

Your duties begin when you take on your first eligible employee. The Pensions Regulator will contact you after you register as an employer with HMRC with guidance on your declaration of compliance deadline. Missing this deadline attracts escalating fines.

Employees earning between £6,240 and £10,000 per year are not automatically enrolled, but they have the right to opt in and receive your employer contribution if they ask. Employees earning below £6,240 can join the pension scheme but are not entitled to employer contributions.

Five mistakes cleaning businesses make when hiring

These are the errors that generate employment tribunal claims, HMRC investigations and substantial financial penalties. They are all avoidable with straightforward process.

1. Not doing the right to work check. Many employers assume they can tell from a person's accent, appearance or familiarity that they have the right to work. You cannot. The check must be done, the document must be the right one, and you must keep a copy. With civil penalties now up to £60,000 per worker, the cost of skipping this check is not worth contemplating.
2. Paying cash in hand without PAYE. This is one of the most persistent myths in the cleaning sector — that paying cash is fine as long as the worker "doesn't mind" or "prefers it that way." It is not fine. PAYE is your obligation, not theirs. HMRC's compliance teams target cleaning businesses specifically, and cash payments with no payroll records are a red flag.
3. Not issuing a written contract on day one. Many small cleaning businesses issue a contract weeks or months after the employee has started — or never issue one at all. Employment tribunals award up to four weeks' pay as compensation for failure to provide a written statement. More importantly, without a written contract, any dispute about hours, pay or notice defaults to statutory minimums and whatever the tribunal considers was agreed verbally — which is always uncertain territory.
4. Forgetting employer's liability insurance. Public liability insurance is not the same thing as employer's liability insurance. Many cleaning businesses have the former and assume it covers them for employees. It does not. Employer's liability insurance covers injury or illness suffered by employees in connection with their work. It must be in place from the first day of employment, at a minimum of £5 million.
5. Underestimating the total cost of employment. Budgeting only the gross wage — without accounting for employer NI, holiday accrual, pension contributions and the administrative cost of payroll — leads to cash flow problems within months of hiring. Use the full employment cost figures in this article to set your pricing before you hire, not after.

Hiring your first employee is a commitment, but it is also how cleaning businesses scale. The legal framework exists to protect both employer and worker. Get the foundations right — employment status, PAYE, right to work, insurance, contract — and you will have built the kind of employment relationship that lets you focus on growing the business rather than managing compliance crises.