New bills were announced in the Queen’s speech yesterday amongst which was the Enterprise and Regulatory Reform Bill, which is intended to reduce the amount of ‘unnecessary” business legislation and limit inspection of firms.
The Bill will make it easier for employers to hire and fire staff through an overhaul of the tribunal system. There will also be higher fees for employees who are sacked, thereby limiting the number of vexatious claims. And employees will have to go to a dispute resolution service before launching an unfair dismissal claim.
Business Secretary Vince Cable said: “Securing economic growth through business investment and trade is absolutely essential to recovery. Government’s plans to cut red tape, boost green investment, reform the competition landscape and reform the banks are vital moves that would help strengthen the business environment and boost consumer and business confidence.”
While there was some praise for the new Bill, some commentators feared that it might actually increase the administrative burden on employers. For example, John Walker, chairman of the Federation of Small Businesses, raised concerns that forcing companies to go into mediation with sacked employees could actually create “an additional administrative layer”.
And John Cridland, director general of the CBI said that he was undecided about the efficacy of the Bill, saying: “The test for this Queen’s Speech is whether it will help businesses to grow. Two Bills stand out for me: energy and regulatory reform. The first should help, but the jury’s out on the second.”
John Longworth, director general of the British Chambers of Commerce shared his doubts: “On balance, business will welcome some of the Government’s proposed legislative measures, but express serious reservations about others. Positive steps such as reform to employment tribunals and red tape reductions could be undermined by complex new burdens around shared parental leave, for example.”