Chancellor George Osborne has just proposed the introduction of “fire at will” dismissal law that will enable small employers to dismiss staff more easily.
Under-secretary of state for employment relations, Norman Lamb, is unveiling plans during March which would remove restrictions on laying off staff at businesses with fewer than ten employees.
It is proposed that poorly performing employees are laid off whilst the employer can recruit staff who will perform more effectively. It is claimed that current rules allow employees to “coast along” without management action. The proposal is designed to support the “cutting the red tape challenge” and increase employment.
However, the latter is debateable whether employment legislation is contributing to increasing unemployment.
There are plenty of employers in the UK that do not currently adhere to employment law and in treating their staff poorly run the risk of incurring an employment tribunal claim during which successful employees have the right to be compensated for lost employment rights.
Should the government introduce their proposal of compensated no fault dismissals, employment rights will be diminished. The government’s proposal is underpinned by an anticipation that the value of small businesses to the economy will increase.
Regressive steps
However the danger of changing the law to allow easier dismissals for small companies could instead backfire and scupper the government’s plans of their contribution to economic growth.
There could be many underlying reasons of poor conduct that require deeper investigation and promotes fair treatment. If the law is changed and small businesses are allowed to operate in a “fire at will” manner, the effects on employee morale within a company could be very damaging.
Company reputation will also suffer and have a negative impact on the bottom line. If the dismissal has a discriminatory angle employees have the right to go to an employment tribunal regardless of length of service adding to costs.
Poor performance, regardless of company size, is easy to manage through a fair process of monitoring and support. Practical advice can easily be sought from an HR practitioner.
The government needs to carefully think about the introduction of such a proposal. Coupled with their firm intention to introduce fees for claimants to lodge an employment tribunal claim, access to employment rights for many downtrodden workers will be, all but, practically removed.
This will mean going back to before the beginning of the 20th century when protection for worker rights began and will not be good for the future.
Sandra Beale is an HR consultant at SJ Beale HR Consult.
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