Employer Perceptions of Employment Law

[Thanks to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]

The Department for Business Innovation & Skills (BIS) has published a new report in its Employment Relations Research series:  Employer Perceptions and the Impact of Employment Regulation.

This report was carried out on behalf of BIS by researchers from TNS/BMRB and Kingston University.  A total of 40 businesses took part and were interviewed over the spring and summer of 2012.

The report makes very interesting reading.  Contradicting the Coalition government's thinking on the impact of employment law on business via its 'Red Tape Challenge' and Employment Law Review, respondees generally considered that employment regulation was both necessary and fair.  In the main, anxiety about employment law stemmed from a fear and misunderstanding of the law. This is the so-called 'perception reality gap', identified by other researchers such as Peck and others in Business Perceptions of Regulatory Burden (2012).

The key points in the report are as follows:

Employers were often supportive of a regulatory framework for employment for the employment relationship.

Reducing regulation for small employers might not actually be effective in reducing anxiety, because those employers are often unaware of the changing laws relating to employment.

Employers have a fear of being taken to an employment tribunal over unfair dismissal, and some myths surrounding the dismissal process need to be dispelled.

Tribunal outcomes were perceived as unpredictable.

Small employers tended not to formalise disciplinary procedures unless dismissal was being considered, a process which often let to litigation.

A solution to that problem would be for small businesses consistently to follow a procedure for dealing with performance and conduct. But these employers expressed a fear that this would damage the personal element of the employment relationship in a small business.  

The report identifies a clear need to provide a single information portal regarding employment law and HR.

When looking at reforms to simplify employment law, the focus should be on disciplinary and dismissal procedures. An interesting finding was that, four years on,  many employers still believed there was a statutory disciplinary and dismissal procedure that needed to be followed.

An insightful conclusion of the report is that employers' perception of legislation as burdensome is based more on an actual fear of litigation, rather than any actual experience and is actually worsened by the public pervasiveness of the 'anti-regulation' debate.