Numerous employment regulations have been weighing down HR professionals for a long time, from regulations governing the use of agency workers to laws around staff dismissal. While legislation is of course necessary to provide a framework for businesses, its complex nature can all too often prevent organisations from making important business decisions. The Government recently announced plans to either scrap or overhaul some 3,000 regulations with the aim of boosting business growth. This is undoubtedly good news for UK businesses, but it’s vital that employment regulations are at the heart of this review so businesses can have the confidence and certainty they need to grow their workforces.
Brook Street’s independent research, in partnership with YouGov, found that employment legislation in the UK is a significant burden for employers. In fact, just one in ten businesses think that existing employment legislation is fit for purpose and almost two-thirds (62 percent) of those questioned in the survey felt that employment regulation has a negative impact on their business. Furthermore, many believe that the employment regulations are ‘over-engineered’ and that they simply don’t give businesses the flexibility they need, with HR professionals often left bearing the brunt of the layers of red tape.
The complexities of employment legislation seem to be too much of a burden for UK businesses and in response, many companies are choosing not to hire staff than risk being non-compliant. In fact, in our survey 40 percent of respondents say it deters them from taking on new people. At a time when organisations needs to do everything possible to get back on their feet, this figure is far too high and it is crucial that businesses’ recruitment and expansion plans are not held back by over-regulation.
Clearly, a lack of understanding around the intricacies of legislation and a fear of the potential risks associated with non-compliance is making employers nervous about dismissing under-performers. It appears that companies are resigned to a ‘better safe than sorry’ strategy which might seem like a sound solution at first, but in the long-term it can have a negative impact on their productivity, growth and overall competitiveness. It’s vital that businesses take their time to understand how employment regulations affect them, otherwise they risk having a stagnant talent pool and in turn stagnant business performance.
I cannot help wondering what might happen to the UK’s fragile economy if businesses had more confidence to hire and innovate. It’s clear from our conversations with small businesses that many companies are keen to start doing things differently, but all too often, concerns and questions over employment regulations are holding them back. It’s important to remember though that businesses are not alone when it comes to understanding employment law. There are employment experts and recruiters around who can guide businesses through the intricacies of legislation and inspire them to grow their business. In fact, that is exactly why we have created our new Survive & Thrive campaign – to help and support UK businesses as much as possible through these difficult times. In an uncertain economy and with layers of legislation to get through it can be difficult to have the confidence to invest in people, but with the right advice, the right strategy and the right people, the business benefits are clear.
Here are some key considerations to help guide your business through the regulatory maze:
- Implement a long-term strategy aligned to your business objectives: Employment law is constantly changing so it is important to have a long-term plan to help you deal with these changes more easily as and when they happen.
- Assign the right people: Make sure someone suitable in your company is responsible for being aware of what regulations are on the horizon so they can promptly communicate these to the wider HR team or senior management. Any necessary changes to the way your business runs should then be implemented in a timely manner.
- Obtain the right advice: Knowledge is power, and by taking the time to understand regulatory requirements, you will be in a much stronger position to take on new talent and move your organisation from merely surviving to thriving.
Erika Bannerman is Sales and Marketing director at Brook Street, the recruitment specialists. With over 20 years’ industry experience, Erika deals with a number of organisations from SMEs to FTSE 100s to provide in-depth recruitment and strategic solutions advice.