An expert has claimed that red tape is deterring new start-ups from generating fresh employment opportunities and urged the government to consider relaxing rules for some smaller companies.

Rebecca Burn-Callander, editor of small to medium-sized enterprise (SME) support website, warned that regulations are adding to the already high workload of entrepreneurs and said most should be temporarily suspended for new firms.

“Considerations like maternity leave, the new paternity laws, tribunals and new flexible working rights make hiring staff a legislative and financial burden,” she explained. “It’s never been this expensive to employ people.”

Ms Burn-Callander stated that many employment laws should be waived for two years following the formation of start-ups, reducing their HR responsibilities and freeing them up to grow and hire additional workers.

Her comments came after a study from the Forum of Private Business indicated that a significant proportion of SMEs were planning to cut staff this year.

Posted by Hayley Edwards