Employers welcome government task group report on impact of employment regulation

In May 2002, a report by the government-appointed Better Regulation Task Force argued that current approaches to employment regulation in the UK are damaging business, and called for government departments to pursue alternatives to legislation for achieving policy objectives. Employers' groups welcomed the report.

On 15 May 2002, the Better Regulation Task Force published a report, Employment regulation: striking a balance, examining the impact of employment regulation on business. The report argues that businesses feel overwhelmed by the volume and complexity of current employment regulations, and that the regulatory burden is a particular source of concern for small and medium-sized enterprises.

The task force said that it found little evidence that government departments give serious consideration to alternatives to regulation. The report recommends that government departments should:

  • fully analyse the scope for non-regulatory options for achieving policy objectives, with legislation to be a last resort; and
  • closely involve independent experts in developing innovative alternatives to regulation.

The report also says that employers find it difficult to keep abreast of frequent changes in employment regulation and recommends that the government should, as far as possible, group together the commencement dates of changes in employment regulation.

Other recommendations by the task force include:

  • a review of the direct and indirect effects of employment legislation on different sized firms;
  • improved advice and guidance on regulatory requirements; and
  • piloting new mediation and arbitration services aimed at businesses with fewer than 50 employees.

The main UK employers' organisation, the Confederation of British Industry (CBI), said that it gave 'strong backing to the new drive to tackle red tape proposed by the task force'. CBI deputy director-general John Cridland said that the task force's report would 'reassure firms that are feeling utterly overwhelmed by the burden of employment law, which has reached record levels. But employers will be deeply disappointed if this turns out to be another false dawn. The government must show it is capable of turning fine words into real action.'

The Chartered Institute of Personnel and Development also welcomed the report. Its director-general, Geoff Armstrong, said in a statement: 'The complexity of the new employment laws and the speed with which they have been introduced are sources of great frustration for employers. Too often there is a complete lack of understanding of the time it takes to implement regulation in a way that best reflects the needs of business and employees.'

The Better Regulation Task Force is an independent advisory body set up in 1997 'to advise the government on action which improves the effectiveness and credibility of government regulation'. It is advised and assisted by a team of officials in the Cabinet Office. The task force is made up predominantly of people with a business background.

The task group's report on employment regulation has been drawn up against the background of sustained criticism by employers' groups of the extent and cumulative impact on businesses of statutory requirements (UK0110106N and UK0112103N). The view of the Trades Union Congress, highlighted in a new leaflet published in May 2002, is that employer pressure to 'cut red tape' is in reality a call for 'less employment protection', even though 'people at work in the UK enjoy fewer rights than most people in the rest of Europe.'

Useful? Interesting? Tell us what you think. Hide comments

Eurofound welcomes feedback and updates on this regulation

Add new comment