Since coming into power in 2010 the Government have sought to make significant changes to employment law. Their aims in doing so have been to ease the regulation of employers through the "Red Tape Challenge" and to reduce the burden of unnecessary employment legislation. Overall the stated aim of the Government is to ensure employment laws provide the flexibility required for employers to grow and that the obligations under them are not too onerous for employers.

Implicit in this approach by the Government is that employment law currently imposes obligations which are too burdensome on employers and which do not provide the necessary degree of flexibility to employers. The Government have previously stated that they knew that there was a perception among employers that employment laws are not working and need to change and that they were generally balanced in favour of protecting employees, with few obligations on employees to make the employment relationship work.

This approach of the Government has been challenged to some extent by the findings of the recently published report "Employer Perceptions and Impact of Employment Regulation". This report was carried out on behalf of The Department for Business, Innovation and Skills by researchers from TNS/BMRB and Kingston University. A total of 40 businesses of different sizes took part and were interviewed over the spring and summer of 2012. Contrary to the Government's view this study found that employers do not dislike employment regulation in general. In fact they view it as necessary and fair as it ensures employees' rights are protected and provides a legal framework for employers to refer to when managing their staff. Only when asked directly did employers say that employment regulation was burdensome.

Rather, the main problem which employers identified was a lack of understanding of employment laws and this caused the employers to view employment regulations as burdensome. In particular there was confusion surrounding dismissal processes with the general perception among those employers questioned in the study being that such processes are lengthy and costly and that, mistakenly, a statutory process has to be followed when dismissing employees.

In light of this it seems the Government should perhaps put more resources into educating employers, particularly those who do not have access to HR professionals, about employment regulation and the impact it has on their business to ensure any myths are dispelled. Certainly it was the conclusion of the study that some work may need to do be done to remove such myths in order to reduce the perception that regulations are too burdensome. Arguably the Government's current raft of proposals to make changes to employment laws could further confuse employers and, at the very least, the results of this study emphasizes the need for the Government to ensure employers are well informed about what these changes mean for them in practice, as otherwise employers may still view employment regulations as being too onerous.

The other key findings of the study are:-

  • employment regulation was rarely a key driver of how employers recruited and managed their employees;
  • when recruiting staff, employers were primarily concerned with finding the best candidate with the required education, work experience and skill level. However, equality legislation, recruiting migrant workers and the Agency Workers Directive were said to impact on recruitment practices;
  • most employers regularly using agency workers had avoided the effects of the Agency Workers Regulations 2010 SI 2010/93 by shortening assignment lengths to less than 12 weeks, bringing in different workers each week and using fixed-term contracts for longer term cover;
  • employers with written employment policies were more confident that they were compliant with regulations than employers who operated more informally. Employers without formal policies felt they were at risk of litigation but believed that working informally maintained better working relationships with staff and ensured managerial autonomy; and
  • micro, small and medium sized businesses who had little internal HR expertise saw employment regulation as complex and inaccessible to people who lacked a background in law or HR.

The full study is well worth a read and can be viewed here:-

Employer Perceptions and the Impact of Employment Regulation