Summer of red tape will leave small firms hot under the collar

This is of concern to the FPB's Campaigns Manager, Victoria Carson: "The extension of SMP could be a problem for many small businesses that fear they will be left holding the baby if workers decide to take extended leave. Little thought has been given to the financial impact for businesses that can't easily find a replacement for the absent worker."  

"Big businesses can quite easily replace members of the workforce without serious consequences; however this is not the case for small firms with highly-skilled, specialised or experienced workers. As a consequence, the responsibilities of missing employees have to be passed onto other staff, reducing productivity and profitability." she added. 

FPB member David Berry is Managing Director of Individual, an interior design company in Bournemouth: "When we had 2 out of a workforce of 18 people on maternity leave at the same time, the effect was crippling. Temporary, skilled replacement staff are very hard to find. We still haven't recovered because we didn't have the capacity to cope." he said. 

"To make matters worse, when they returned they both decided to go part-time and then both left within three months. I could have attracted a better candidate if I had known that the positions would be vacant in the long-term." 

With additional changes being made to areas of employment law among others, Miss Carson believes the cost of compliance for smaller firms will increase over the next few months.  

"Smaller businesses will be hit with costs in terms of time taken to understand and introduce new regulations, then there is the cost of the impact on productivity. There is also a real danger that, due to the complexity of the regulations and the lack of resources of smaller businesses to deal with them, companies may contravene them and end up with a fine or being taken to an employment tribunal." 

Not all the changes to maternity leave are negative for smaller firms, the ten ‘keeping in touch days' could prove very useful, maintaining relationships and making the skills and experience of missing workers available to the employer. 

Flexible working 

The FPB is warning its members that more new regulations due to come into force in the next few months could also impact on the working relationships between employers and their staff. In particular, Miss Carson highlighted changes to flexible working hours.  

"Under the new regulations, the right to request flexible working – which was previously available only for parents of children under 6 or under 18 if the child is disabled – will be extended to carers of adults. There is a danger that some businesses could as yet be unaware of the changes or may not know how to deal with such requests." 

"Smaller businesses recognise the value of having employees that can balance a happy home life and productive work life. But some will still struggle to come to terms with these changes. The nature of some companies will mean that they may have to turn down requests for flexible working hours, even if they would like to help. That will put stress on to the employer-employee relationship." she added.  

Evidence to the DTI 

The FPB has welcomed the Department of Trade and Industry's (DTI) Employment Simplification Review and has submitted a paper including a survey of 150 smaller businesses, to provide an evidence-based response of the cost of compliance with employment law. The survey found that: 

• Health and safety regulations are extremely time-consuming for smaller businesses and are considered totally disproportionate. The regulations suffer from a lack of clarity and increasing complexity which should be addressed. Almost two-thirds of respondents indicated that the administration and complexity of the regulations were prohibitive. 
• Absence control and sickness – there is a need to monitor increasing levels of complexity, and any programme of simplification should focus on long-term illness. Over 40% of respondents felt that the regulations were disproportionate. 
• Dismissals and redundancy – those respondents who had experience of this area expressed concern over a highly complex and process-driven set of regulations which resulted in the need for costly expert help. 
• Maternity and paternity – the key concern for small businesses is not necessarily the complexity of these regulations, but the immense cost in terms of pay and resource. Qualitative data indicated that increasing extensions in maternity and paternity leave and pay are having a damaging effect on employers' views of women in the workplace.  
• 83% of respondents spend up to 12 hours a month dealing with PAYE and other tax or National Insurance issues. The burden on small businesses is immense and respondents felt that the administrative burden and complexity of the legislation is excessive. This results in the need for outsourcing to expensive experts or the introduction of software packages that smaller firms find confusing or even impossible to use .
   

More red tape 

Miss Carson thinks that other new regulations due to come into force in the next few months could have the effect of making the employer responsible for the actions of their staff. 

"The smoking ban will mean employers will have to be vigilant, making sure that their employees are adhering to the new regulations, because it is the business that could be held responsible." 

There are other new regulations that companies must be mindful of, such as the implementation of the Waste Electrical and Electronic Equipment (WEEE) Directive which places fresh duties on businesses. Meanwhile the FPB is campaigning against changes to the Construction (Design and Management) Regulations (CDM) for firms having building work carried out. The FPB is advising employers to swot up on the changes, which are covered in the FPB's Employment and Health and Safety Guides. 

The FPB Employment Guide 

The FPB's Employment Guide contains the help needed for smaller businesses to implement the law in the workplace. The Guide gives all the information needed, from recruitment through to dismissal, to help avoid industrial tribunals and unfair dismissal claims, and maintain positive workplace relations. With a CD-ROM containing easy-to-use letter and contract templates, the FPB Employment Guide helps businesses get it right with the minimum of fuss and effort.  

The Health and Safety Guide 

A successful business is dependent on the health and welfare of its employees and customers. The business owner is responsible for ensuring a safe working environment. The FPB's Health & Safety Guide is designed to help business owners do this with the minimum of fuss.