Coalition Government: employment legislation policy

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05 Apr 2011

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The Government announced the following new employment law policy in its document "Plan for Growth", issued after the March 2011 budget, and in speeches from ministers at the Department for Business, Innovation and Skills (BIS). Stuart Chamberlain, author and HR expert at Croner looks at the key points arising from the paper. Legislation not coming into force In order to reduce the costs of regulation on all businesses, the following legislation will not come into force:

  • The Government will not extend the right to request time to train to businesses with fewer than 250 employees. It is estimated that this implementation would have cost businesses up to £350 million a year. Small and Medium-sized Enterprises (SMEs) will now have the flexibility to manage the training requirements of their companies to meet their needs without spending time on administering the "right to request" process, which is proportionately more costly for smaller businesses.
  • It will not bring forward the dual discrimination rules in the Equality Act 2010 that would have cost business £3 million per year.
  • The Government will repeal the extension of the right to request flexible working to parents of 17-year-olds, planned for 6 April 2011, which would have had an administrative burden costing £0.5 million.
  • It will consult to remove the unworkable requirement in the Equality Act for businesses to take reasonable steps to prevent persistent harassment of their staff by third parties as they have no direct control over it, which would save £0.3 million.
Small business exemption The Government recognises the particular burden that new regulation places on small businesses. As a result, it will exempt micro businesses (ie businesses with fewer than 10 employees) and genuine start-ups from new domestic regulation. This moratorium will last for three years and applies to all regulation — which presumably means any legislation that is not derived from European law — it is due to begin on 1 April 2011. Public audit of statutory instruments In addition to this moratorium, the Government will undertake a public audit of almost 22,000 statutory instruments. The legislation will be grouped into themes on a dedicated website and businesses will be asked to inform the Government about what they think of those regulations and how to improve the system. Any overly burdensome or unnecessary regulations will then be removed, unless the relevant department can justify their continuation. "Sunset" clauses The Government is also to publish details of how it proposes to introduce "sunset" clauses (i.e. how long the law will last) into new regulations. These new regulations will be reviewed after five years to see if they are effective, if they are still necessary, and whether the costs to business can be reduced. If they are found to be working as expected, then the regulation will be extended for a further five-year period. New regulations derived from EU directives will, for small firms, only match the minimum required by European law.

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