Better employment law procedures ‘can reduce business costs’

Posted 17/09/2009

Companies have been advised to ensure their employment law procedures are “watertight” in order to avoid unnecessary expenditure on administration.

The Forum of Private Businesses (FPB) has published new figures which reveal expenditure on redundancy procedure and other job-related legal costs is the largest administrative burden faced by smaller firms.

According to the body, this may be being exacerbated by non-compliance with employment law, which is leading to an increase in the number of companies being taken to tribunals.

Matt Goodman, FPB’s policy representative, warned that incoming legal changes, such as the increase in the weekly wage limit used to calculate redundancy payments, could be set to make such matters even more costly and complex.

He therefore suggested that firms seek help and advice to ensure they keep abreast of all of their legal requirements and avoid being hit with unnecessary costs.

This comes after the Chartered Institute of Personnel and Development warned that selecting a worker for redundancy due to a long-term illness could be considered an employment law violation and may result in a compensation claim.