Can a child legally work in our family business?

13 May 2021

Often overlooked are the restrictions imposed on the employment of children, which are applicable regardless of whether the child you employ is related.

You need an extra bit of help on the weekends or during the school holidays. Your teenage son or daughter is crying out for an extra bit of pocket money. It’s the perfect fit and one of the many reasons why children end up helping out in the family business.

What’s often overlooked however are the restrictions imposed on the employment of children, which are applicable regardless of whether the child you employ is related to you or not. Note that separate provisions apply in relation to children undertaking work experience placements as part of their education, and in relation to public performances by children. A ‘child’ is any person under compulsory school age (in England and Wales a child ceases to be of compulsory school age on the last Friday in June of the academic year in which the child reaches 16).

Restrictions will vary somewhat between local authorities, but some of the key restrictions are that it is illegal for a child to work:

  • if they are under 14 years of age (note however that many local authority byelaws do permit 13 year olds to be employed)
  • during school hours or before 7.00am or after 7.00pm
  • for more than two hours on a school day or a Sunday
  • for more than 12 hours in any school term week
  • for more than five hours on any non-school day other than a Sunday (for more than eight hours if aged 15 or over)
  • without a one hour rest break after working four hours in any one day
  • without the employer notifying the local authority and obtaining a work permit, if the local authority in question operates a permit system (most do).

Many will be familiar with the prohibition on employing under 14s and the restrictions on the hours that children can work, but in our experience it is the need for children of compulsory school age in employment to have a work permit which is most often overlooked, particularly in family owned businesses.

Any employment of a child, whether paid or voluntary, is illegal without a work permit and this applies to parents employing their own children in the family business. Any employer found to be employing a child without the necessary work permit may be liable to prosecution by the local authority, as well as by the enforcing authority under health and safety law.

The potential fine for an employer failing to have a work permit is £1,000. However a failure to carry out a risk assessment (part of the work permit application process) can result in a fine of up to £2,000 (unlimited in the Crown Court). There is also the risk that your employer’s liability insurance would not cover a child who has been employed without the necessary permit.

What you need to do

The work permit application process is not onerous and is in most cases simply two sides of an A4 page long. Along with the application form the employer will need to provide certain information to the local authority, within one week of employing a child. This information includes:

  • the hours and days on which the child is to be employed, the occupation in which the child is to be engaged, details of the task involved and the place of employment
  • a statement, by a parent of the child, that the child is fit to work and that the parent agrees to the employment
  • details of the school at which the child is a registered pupil
  • a statement to the effect that an appropriate risk assessment has been carried out by the employer.

Provided the local authority is satisfied that the proposed employment is lawful, that the child’s health, welfare will be looked after and that it will not negatively impact on their education they will issue a work permit which will then need to be kept by the employer for the duration of the child’s employment.

Can a child work in a family business?

Yes, but they will need to be at least 13 years old and there are restrictions on the days and hours that they are legally permitted to work.

What type of work are they allowed to do?

Children are only permitted to do ‘light work’, which means work unlikely to be harmful to the child’s safety, health or development, to their school attendance or participation in work experience. Local authority byelaws may place other restrictions on the work that a 13 year old is permitted to undertake. In addition, unless local byelaws permit it, a child cannot be employed in street trading.

What should they be paid?

Children are not entitled to be paid the national minimum wage, so there is no statutory restriction on what they should be paid. Young workers, under 18 but above the compulsory school age, and apprentices are entitled to receive the NMW at the appropriate rates.

For more information contact Liz Stevens on 01603 756474 or [email protected]. Alternatively, please contact another member of the Employment team.

The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at May 2021.