The relentless flow of complex employment law is stifling UK competitiveness and risks future job creation, according to a new report by the British Chambers of Commerce (BCC).

Employment regulation: up to the job? is published a day ahead of the official labour market figures, expected to show that unemployment has surpassed 2.46 million. It argues that basic workplace protections have been supplemented with burdensome rights to request, extended time-off provisions, and unreasonable health and safety restrictions.


Some of the most striking problems identified in the business group’s report include:


·         The average waiting-time for a first hearing at an employment tribunal is an unacceptable 20 weeks.

·         It is extremely difficult for an employer to prove gross misconduct has taken place. Even in the case of a security guard who was dismissed for leaving his post unattended, the tribunal found this was not grounds for gross misconduct.

·         Employers have ‘the same responsibilities for ensuring the health and safety of home workers as they do for staff based at their own premises’. This includes carrying out a risk assessment and an assurance that lighting and glare within a worker’s home is safe.

·         Employees are allowed to make claims against their employer without taking any advice on the merits of their claim.


The BCC makes a series of constructive recommendations to help reduce and rebalance the burden of employment red tape, and suggests an urgent overhaul of the UK’s dysfunctional tribunal system. These include:


·         Employers should not have to wait more than 16 weeks for a first tribunal hearing.

·         The law should be changed to allow employee dismissal if an employer ‘reasonably believes’ that a member of staff’s actions constituted gross misconduct.

Employers should only have responsibility for equipment they have provided to a remote worker; otherwise remote workers should be responsible for health and safety in their own home.
Employees making claims must receive advice from either a solicitor or Acas, the workplace dispute advisory service, before submitting a formal claim or complaint.

Commenting, David Frost, Director General of the BCC said:


“There is an emerging consensus that employment law is now weighted too far in favour of the employee. Many rights come from EU legislation, which is informed by and aimed at labour markets very different to our own. The result is that the UK and the EU are becoming increasingly uncompetitive due to the rising cost of labour.


“Encouraging job creation – and therefore wealth creation – must remain the government’s priority as economic recovery continues. A three year moratorium on the implementation of new employment law is crucial, as is cancelling the 1% hike in employer National Insurance contributions, planned for April 2011.”


Lord Mandelson and Ken Clarke will be challenged with the report’s findings when they meet to debate at the BCC’s annual conference on Thursday.