April means only one thing in the HR world - employment law. Yes, yesterday was D-day for employment legislation and once again the legal profession will be rubbing its hands in glee as confused, overburdened employers seek clarification of the changes.
However, for once some of the new legislation is to the benefit of employers, notably the increase in the qualifying period for unfair dismissal claims. From yesterday (6 April) employees whose employment begins that, or a subsequent, date will need to complete two years’ service before they can claim unfair dismissal, although it’s worth stressing that this is not retrospective.
Business successfully argued for this change by convincing government it will give companies the confidence to invest in jobs. Employer lobby group CBI persuasively argues that regulation, especially employment law, is putting a brake on expansion, in particular on smaller companies.
At its annual conference last month, the British Chambers of Commerce echoed this, with director general John Longworth pointing to the “multitude of small regulations” that add up to a “huge mountain to climb”. Meanwhile, the Forum of Private Business has put the cost of employment law to small business at £4.2bn.
The government is making the right noises, with its Red Tape Challenge and ‘one in, one out’ approach to regulation. Business secretary Vince Cable says this approach is stemming the flow of new regulation and that government is “identifying a substantial number of regulations for repeal or consolidation”. But it seems it is not moving fast enough for business. A survey by Barclays Corporate last week found four in 10 businesses did not plan to create jobs over the past 12 months, despite all the coalition’s efforts to remove barriers to job creation.
So while this month’s employment law changes are the least onerous for some time - the others being a rise in statutory maternity/paternity pay, adoption pay, statutory sick pay and changes to national insurance and income tax rates and thresholds - they are unlikely to help job creation and growth. In fact, we may see new jobs miraculously appearing that could well have been available earlier but which have been kept under wraps to take advantage of the new legislation. Think about that if employment figures mushroom in the coming months.