Businesses are reeling. On 1 October they were hit by one of the biggest rafts of legislation to come into force on a single day, with new laws relating to age discrimination, the national minimum wage, maternity rights, fire safety and gangmasters.

Their introduction came as the CBI published a report, based on the government's own regulatory impact assessments, revealing that since New Labour came into power, employment legislation had cost businesses £37bn.

Arguably the biggest issues for industry employers are the rise in the minimum wage and the age discrimination regulations.

Recent minimum wage increases have already added £1bn to retailers' wage bills, according to the British Retail Consortium.

James Harborne, its public affairs executive, says: "We feel that a large proportion of the industry is going to find it difficult to absorb."

That's bad enough alongside soaring rents, rates, energy prices and property costs, but businesses will also have to take into account new regulations relating to pensions and paid holiday entitlements in the next few years.

James Lowman, director of public affairs at the Association of Convenience Stores, explains: "Pensions will add 1% to payroll costs and paid holiday 1% to 2%. We're talking about year-on-year cost increases pushing 10%. In c-stores generally wages amount to 11%-12% of turnover, where it used to be 8%-9% a few years ago. That can represent more than half of the business's gross profits."

The latest 6% hike in the minimum wage also makes it hard for employers to maintain pay differentials further up the employment chain, he says.

The Forum of Private Business wants future increases to be pegged to the Retail Price Index. Matt Hardman, its media and PR officer, says: "At the moment it is going up at a staggering rate that can't be sustained."

The Food and Drink Federation, meanwhile, is calling for future rises to be in line with inflation.

Like the minimum wage, the new age discrimination laws are welcomed in principle, but some experts believe that they are too complicated, unnecessarily restrictive and could hamper recruitment of the best people. The same applies with the new maternity regulations.

There are also concerns that the two sets of regulations could clash. Paul Cotton, partner at law firm Eversheds, says: "A young person who is paid the minimum wage applicable to them or a rate above that rate but below the standard rate will not be able to complain of age discrimination just because someone who is in a higher bracket for minimum wage purposes is paid more than them.

"However, they could claim age discrimination if someone in the same age bracket is paid more on account of their age."

Fears of such a clash are likely to have been behind Asda's announcement this week that it is scrapping its "under 18" rate to offer equal rats of pay for all colleagues doing the same job.

Others will no doubt follow suit. Commenting on the swathe of employment laws, Jonathan Chamberlain, partner in the employment team at law firm, Wragge & Co, says: "This is possibly the biggest piece of social engineering for 40 years. The government is evidently trying to change society's attitudes towards age and family.

"But they are doing so by asking employers to lead a social revolution. Most employers think they are engaged in running a business. There are going to be tears."

He likened the government's uphill task in changing attitudes towards age to changing attitudes towards race and colour.

He argues that although attitudes do change, they change slowly. "We're a lot closer to 1964 than 2006 in terms of age discrimination," he adds.

If the government is to realise its ambitions, it will need to do more to help businesses comply with the new regulations, warn experts. The BRC's Harborne says: "A lot of it is going to be down to government's raising of awareness and education about how to manage issues such as maternity."

The BRC is calling for a wider review of the long- term impact of the minimum wage, while the FPB is asking for a small firms minister and is introducing an employment law guide late next month to help businesses navigate the red tape.

Their message to employers is: get to grips with the legislation now. Despite the government's insistence that the focus will now be on simplification of existing legislation, there's likely to be a lot more to come.