18 March 2013

Employer perceptions of employment law out of step with reality

A recent Government research survey appears to be at odds with many of the arguments the coalition has used to justify its reforms on employment law since coming to power.

The main thrust of the study entitled 'Employer Perceptions and Impact of Employment Regulation' is that many businesses view employment law as overly burdensome, while accepting that this view was mostly derived from a lack of understanding.

Contrary to the Government's view, the business survey confirmed that regulations were rarely a key factor when it came to recruitment and management of staff. Unsurprisingly, the main criteria for recruitment remain to be, to find the best candidate, who has the necessary education, required work experience and skills to perform the role.

The survey revealed that employers who regularly used agency workers had avoided the effects of the recent changes made through the Agency Workers Regulations 2010 by offering shortened assignments of less than twelve weeks, alternating workers and using fixed term contracts for longer periods of cover.   

There were also many outdated beliefs still held by employers with many believing the old three stage statutory dismissal process was still in effect (it has not been since April 2009 when the ACAS Code of Practice was introduced).

Conclusions

One of the key conclusions of the research was that employers with written employment policies were far more confident they were compliant with the law than those who operated on an informal ad hoc basis.

Surprisingly, the main reason businesses gave for continuing practices of oral employment contracts and no codified policies was to foster better relationships with employees. They believed that this outweighed the risk of litigation.

Further, micro, small and medium sized businesses that had little internal HR expertise saw employment regulations as complex and inaccessible to people who lacked a background in law or HR.

What can businesses learn from the survey?

Although many of the recent and proposed changes to employment law have been drawn up for the "benefit" of smaller sized business, the survey illustrates the more pertinent issue is education and training. It is clear that teaching businesses to be preventative instead of reactive may ultimately save them from experiencing litigation in the employment tribunal.

Perhaps the answer for small business owners is outsourcing more of the HR and employee management part of the business. This would not only ensure peace of mind that all HR and employment law policies and procedures were properly drafted, but more importantly it would allow them to continue doing what they do best - running their business!