Firms ‘saving’ on compliance costs

It has been estimated that businesses are saving £418 million a year on the cost of complying with employment laws.

The reduction in costs, the Department for Business, Enterprise and Regulatory Reform (DBERR) said, has been achieved through free government advice and the use of online tools.

Between them they have helped employers cut both the time and money spent on regulation compliance.

The impact of the Employment Guidance Programme, which is part of the government’s push to curtail the administrative costs businesses face when dealing with regulations, was measured in a survey of a thousand firms.

The survey revealed that significant savings had been made in the administration of maternity and paternity leave and pay, flexible working time applications, working time and 48-hour opt-out record keeping, and the national minimum wage.

Some 74 per cent of businesses said they found compliance easy, up from 51 per cent in 2005.

A key part of the Employment Law Guidance Programme has been to enable firms to avoid unnecessary and costly over-compliance with regulation.

Pat McFadden, the Employment Relations Minister, said: “Our ambitious programme to cut the costs of regulation on business is already achieving positive results, but there is still more we can do. For example, new changes to dispute resolution that will cut costs further were approved by Parliament last month.”

The minister added: “Giving businesses free and clear advice cuts their costs because if they are getting good advice free from the government they have to spend less on outside consultants. It also helps make sure workers’ rights are respected.

“In the present economic climate we are focussed on doing everything we can to help business, without harming rights at work.”