The Law Society has warned that making it easier for small businesses to dismiss people will not help them grow. The warning comes after proposals in the Beecroft report emerged, giving small businesses greater scope to dismiss employees.

Under the proposals, small businesses will be able to dismiss a worker even where there has been no misconduct or they have not performed to the required standard.

The Government says that small businesses are not expanding because of fear of being caught out by employment laws, in particular, unfair dismissal. It wants to exempt those businesses with fewer than ten employees from these laws.

“Making it easier for small businesses to dismiss people will not help them to flourish and expand,” says Chair of the Law Society Employment Law Committee Angharad Harris.

“There is a clear and well understood framework for employers, small and large. Creating a separate system for businesses with fewer than 10 people will create a ‘two-tier’ system which will be confusing and unhelpful.”

The Law Society warns there is also the risk that ‘compensated no fault dismissal’ will encourage poor management practices. Employers might not realise that ‘no fault dismissal’ doesn’t allow them to dismiss a worker because they are pregnant, or because they have a disability.

Angharad Harris added: “Not only do these changes remove important protections for employees, they also make small businesses vulnerable to other employment tribunal claims.

“What small businesses and first time employers need is support and advice to understand that employment law is largely a matter of good practice.”