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10 December 2008 Employers see ‘reduction in compliance costs’

UK businesses are saving £418 million a year on the cost of complying with employment law, according to Government estimations.

A campaign by the Department for Business, Enterprise and Regulatory Reform (BERR) was originally expected to save firms £365m a year, but new research suggests this figure is in fact substantially higher.

Launched in 2005, the Employment Law Guidance Programme aims to help small and medium-sized enterprises avoid unnecessary and costly over-compliance with regulation.

The scheme concentrates on six key areas of employment law including maternity and paternity pay, flexible working and the national minimum wage. More than one million businesses have been contacted as part of the initiative so far.

The BERR claims this contact, in addition to free Government advice and online tools, has contributed to a visible reduction in business compliance costs.

Employment Relations Minister, Pat McFadden, said: ‘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 a survey of one thousand companies published earlier this year, 74% of firms said they found compliance easy - up from 51% in 2005.