A new survey has found that nearly eight in 10 (78%) SMEs in the UK believe it will be ‘difficult’ to implement the day-one rights introduced by Labour under its Employment Rights Bill, while only one in five (19%) say they have the in-house HR expertise and systems necessary to navigate the changes confidently and compliantly.
The survey of 140,000 small business owners across all major industries in the UK was conducted by BrightHR, a leading global provider of HR and health & safety software and employment law advisory services.
Respondents were asked various questions relating to their awareness of and preparedness for the 60+ employment law reforms by Labour under its ‘Plan to Make Work Pay’, including new day-one rights to flexible working, statutory sick pay (SSP) and protection from unfair dismissal.
The results reveal a lack of knowledge and confidence among small business owners about their ability to comply with the proposed employment law reforms, with nearly nine in 10 (88%) of those surveyed saying they had concerns about implementing the legislation and over one in eight (12%) reporting a lack of knowledge about which HR policies, processes and documentation they will need to update to stay compliant.
Other key findings:
• Awareness: 35% of business owners are unaware of the changes, with a further 48% unaware of the employment law risks associated with the proposed changes
• Confidence in current operations: 42% of business owners are not confident that their HR policies and procedures are compliant with existing employment law regulations
• Confidence to implement changes needed: Only 12% of business owners report they know what to change, in terms of their operations, policies and processes
• Readiness to implement changes needed: Only 19% of business owners report that they are wholly equipped to make the policy and procedure changes needed to adapt to the proposed reforms, with 36% unsure or unequipped
• Concerns about new day-one rights: 78% of small business owners believe it will be difficult to implement new day-one rights, including the right to be protected from unfair dismissal from day one of employment
Other statistics from the research show that:
• Sixty percent of business owners are likely or highly likely to seek expert advice in understanding and implementing the proposed changes, but only 23% are currently accessing third-party support to prepare for legislative change
• Fifty-seven percent of business owners are monitoring the news and reading information online to prepare for the proposed legislative changes
• Forty-two percent of business owners cite their biggest concern as the time it will take to implement the changes
Alan Price, CEO at BrightHR, said: “Small business owners are particularly concerned about the new day-one rights that employees will be entitled to under the Employment Rights Bill, particularly the right to be protected from unfair dismissal from day one of employment, rather than after the current two-year qualifying period.
“These changes will not only demand an overhaul of existing HR policies, processes and documents; they will also require a significant investment of time and resource to make sure they are implemented correctly.”