Businesses believe the Employment Rights Bill will have a negative impact

Research by the British Chambers of Commerce (BCC) has found that businesses are worried about the speed with which the Employment Rights Bill is being put through Parliament and have serious concerns about it.

Many firms do not think its impact has been properly assessed and fear that, combined with the increased tax burden, it will be a barrier to growth.

Businesses are also sceptical about the benefits of the bill with just one in 50 firms saying they think the trade union proposals will be positive.

The research comes ahead of the Report Stage of the Employment Rights Bill beginning in the House of Lords tomorrow (Monday 14 July).

Jane Gratton, Deputy Director Public Policy at the BCC, said, “The opportunity to make any significant changes to the Employment Rights Bill to ease the cost and disruption to business is fast disappearing over the horizon.

While the government has consulted on several aspects, and listened to some concerns, the legislation still does not strike the right balance.

“A number of the proposals are deeply worrying for employers.  They will increase employment costs, complexity and risk for firms, particularly SMEs who will be disproportionately affected.  We are likely to see unintended consequences that could limit people’s employment opportunities and the UK’s economic growth.

“To grow our economy, firms must have the flexibility and agility to deal with challenges and opportunities. Government needs to help not hinder businesses –  to innovate, adopt new technologies and be more productive and competitive. By adding more restrictions and building in further delays before change can happen, the Bill jeopardises all of this. It is creating a lose-lose scenario for everyone in the workplace.

“While there many are things in the legislation that reflect what good businesses are already doing, there are some specific proposals that need amending.  Planned changes to dismissal rules, trade union ballot thresholds and zero hours contracts, for example, are some of the critical areas that need to be revisited.

“The government must continue its positive approach to engagement with business and remain open to changes. Only then can it ensure this legislation is proportionate, affordable and right for both firms and their employees.”