Micro-businesses to be exempt from new regulation
Businesses employing fewer than 10 staff could be exempt from
any new regulation, employment minister Mark Prisk announced on
Friday.
In a speech to the Federation of Small Businesses in Liverpool
on 18th March, Mark Prisk announced that the Government would begin
consulting on a new proposal to exempt small firms from new
domestic regulation for three years.
The aim of the exemption is to give particular assistance to
small and start-up businesses, the owners of which have long
complained that excessive regulation acts as a deterrent to
growth.
The burden of ever-increasing regulation
Commenting on the proposals, Nick Soret, Head of Employment Law
& HR consultancy support at
RBS
Mentor, said:
“This announcement indicates that the Coalition government is
starting to hear the message from small business owners of the
burden of ever-increasing regulation, particularly in the current
economic climate.
“There are three problems with this. The first is that there has
already been a large crop of employment regulation already
implemented by the Coalition or due to be implemented in April.
This includes the Equality Act, Additional Paternity Leave and the
decision to scrap the default retirement age – all of which will
impose lasting burdens on businesses. This exemption comes too late
for these specific changes.
“A second problem is that regulation which comes from the
European Union – which most new regulations do – is not covered by
the proposed moratorium.
“And a final obstacle is the Coalition agreement itself, which
commits the Government to extending flexible working rights to all
employees and to promoting a system of flexible parental leave
during the lifetime of this Government.
“It remains to be seen how much impact the Government’s
proposals will have in practice. However for many business owners,
the change in tone will be most welcome”.