92% of small firms see no reduction in the administrative burden of employment law
60% view employment law as a significant regulatory burden
76% of small businesses do not have a dedicated HR resource
64% of small companies view employment law as a disincentive to employing staff
Labour Law remains a huge burden for small firms
The Small Firms Association today, launched the results of their SFA National Employment Law Survey. Speaking at the launch the Assistant Director of the SFA, Avine McNally, stated that “the influx of new rules and regulations from Europe and their transposition into Irish legislation remains a significant problem for small businesses. As an employer, there are over 40 pieces of primary legislation relating to employment matters, that must be dealt with, irrespective of whether the Company employs 1 or 1,000 staff. Employment Law really has become a “minefield” for small businesses!” stated McNally.
The SFA survey showed that 76% of small businesses do not have a dedicated HR resource to assist them in dealing with the complexities of employment law. The average number of employees in the 24% of companies who did employ a HR person, was 60.
The Employment Law Survey was carried out in the first quarter of 2009. The questionnaire was distributed to 500 small firms and the sample was drawn from manufacturing, distribution, retail and services sectors and from a regionally representative sample across the Irish Republic.
60% of small businesses surveyed viewed compliance with employment law to be a significant regulatory burden, whilst 92% indicated that there was no visible reduction in the administrative burden on employment law. “It is the strongly held view of small business that enterprise development in Ireland is unnecessarily and severely handicapped by the amount of bureaucratisation and the costs associated with it, imposing significant compliance costs on firms weakens the ability of businesses to adapt to changing economic conditions, the extent, scope and impact of employment legislation hits small firms hardest as they are least able to absorb the loss of flexibility and increase costs which occur as a result”, commented McNally.
The survey does show that despite the difficulties involved, small firms are putting correct policies and procedures in place. 92% of companies have a health & safety statement in place, whilst 89% have contracts of employment, 75% have an anti-harassment/bullying policy and 88% have discipline & dismissal procedures. “Given that all companies, regardless of size or sector, are legally obliged to have these particular policies in place, it is imperative that 100% of companies address these issues in the near future”, commented McNally.
40% of companies have no email and internet policy in place, “this is an area that employers do not realize can cause major issues for them, the duty of care rests with the employer to protect their staff and customers from receiving information which they may find objectionable. The growing propensity of e-mail and internet abuse across society generally, is now finding expression in the workplace, employers must remember that they will be held legally liable if their employees misuse their IT systems”, said McNally. The survey also reveals that the majority of small companies have no measures in place to record working-time, either through a clocking-in or manual-recording system. “Less than one quarter of companies (23%) have such systems in place, despite the fact that there has been a legal obligation under the Organization of Working Time Act – Record-Keeping Regulations, since 1st November 2001”, commented McNally.
The survey highlights that 62% of Companies do not retain interview notes. McNally stated that it is essential that comprehensive records of all interviews are kept on file for at least 12 months. If a claim arises, an employer must be able to show that the selection procedures and decisions made at the interview were job-related and that equal consideration were applied to all applicants – this can be shown from interview notes.
83% of Companies stated that they retain absenteeism records, “by monitoring absenteeism levels in an organization, can ensure that there is little or no absenteeism as problems can be highlighted at an early stage and appropriate action can be taken to deal with the problem,” commented McNally.
The survey reflects a large number of employees taking their entitlement to carer’s leave and parental/force majeure leave. 57% of Companies recorded employee applications for parental/force majeure leave, whilst 42% recorded applications for carer’s leave.
Employment law is an area that on a daily basis is becoming increasingly onerous for businesses, particularly for those firms that do not have any specialist in-house resources.” On average each year, the SFA receives 50,000 calls from member companies on issues relating to Employment Law, whilst more than 2 million requests have been registered on the website, www.sfa.ie for this type of information. “Discipline & dismissals, redundancy, and short time and lay off, are the areas of most concern in recent months. Being on the wrong side of just one piece of legislation, however unwittingly, can exact a very high price on a small business! It is essential that small firms are aware of their obligations under the various pieces of employment legislation and be proactive in the introduction of policies and procedures to ensure the protection of employee rights in the workplace”, concluded McNally.
