The Advisory, Conciliation and Arbitration Service claims that these changes will simplify disciplinary procedures but there are concerns small businesses will be faced with the considerable additional expense of revising their existing procedures in order to comply, or face penalty costs should they fail to do so.
Coverzones CEO Simon Ball says: “The different clauses covering age, disability, minimum wages, migrants and the rest will always make compliance to employment law a tricky proposition but, particularly now, the rise in redundancies will expose significant risk for small businesses. The savings that a business can make from seemingly honest redundancies can quickly be negated by the ensuing legal fees that come from a litigation claim from a former employee.
“Any employer who anticipates making redundancies would be wise to consider that employees made redundant in the face of credit-crunch hardship may be more likely to file for a claim. This latest initiative demonstrates once again that policy makers are out of step with the actual needs of business.”
Coverzones provides business insurance online, mainly to small and medium-sized businesses. Ball says it’s clear a signifncant number of small business owners don’t understand they’re legally required to have employers liability cover. “On top of the fact that they already risk fines of £2,500 a day for failing to provide this cover, this new legislation means that if they find themselves caught out they stand to lose even more,” he says. “Recent research from the IOD showed that when a new piece of legislation is enacted, the vast proportion of SME owners are unaware that anything has changed – how many businesses will be wrong footed by today’s changes?”
The change is one of a raft of employment law amendments coming into effect this month. Laws on annual leave have been changed while penalties for not paying the statutory minimum wage have been bolstered and the right to request flexible working patterns to care for children has been extended.
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