Age-related legislation puts bosses of smaller firms under pressure

Broad age-related legislation is putting managers within smaller organisations under pressure, as they try to cope with the paperwork in meeting regulation and avoiding employment tribunals, says Nick Goulding, chief executive of the Forum of Private Business

Standing in the path of progress for employee rights is never going to win friends for owners of smaller businesses. Yet you will find few that enthuse about age discrimination legislation, which came into force in October last year.

Are owners of smaller businesses stuck in the past, harbouring the attitudes of Victorian mill owners? Of course not. These are self-motivated individuals who have invested their time and money into projects that operate on tight margins. The company wellbeing has consequences not just for their personal financial security, but for their employees and the local economy at large. It is understandable then that potentially restrictive or burdensome legislation is greeted with scepticism and often anger. The reaction may have been less acute in this case had this regulatory change been an isolated incident, but it is the sheer weight of fresh legislation being generated that leads to outraged business owners speaking out against perceived improvements in employee rights.

In October 2006 alone, age discrimination legislation, maternity and paternity rights, minimum wage levels and extra fire regulations were altered or introduced. The smaller-business owner was left wading through paperwork and rule books, spending time that should have been put to use keeping their company productive and in profit.

Our ageing population is the motivating factor behind the legislation most recently introduced. Politicians are rightly asking: "If people are living longer, how can we protect their rights at work?" Many of the problems faced by smaller firms are a result of the government’s one-rule-suits-all approach. This has left big business able to adapt and smaller firms in fear of being taken to tribunal.

It is the scale of a business that determines its ability to cope with new regulations. Those with the resource can change quickly, while those without are forced to juggle the process of change with the day-to-day running of their firm.

Financial restraints aside, it tends to be public opinion that businesses large and small should agree that legislation that supports employees is positive. Young or old, we no longer expect age to hinder our prospects. In fact, many smaller firms dispel the myth that job seekers or current employees deemed "too inexperienced" or "over the hill" stand no chance of gaining employment or have little opportunity to develop. There is clear evidence that smaller businesses already actively recruit young and old employees. We must recognise that this good work already takes place and is in the interest of both the employee and the employer. The owner-manager of any half-decent company understands that it takes different ages and types of people to create a productive workforce.

I am not about to say there is no poor practice and no need for legislation that protects workers’ rights. What the Forum of Private Business (FPB) and the 25,000 businesses it represents are opposed to is the broad-brush approach. I spoke recently to a member who runs a delivery firm in Cheshire who requires her drivers to have three years’ driving experience for insurance purposes and peace of mind that the skills of the driver are suitable. She has been told she cannot advertise for drivers aged 21 years or over because it would be discriminatory.

The detail, as always, is in the fine print. It is all well and good dictating the principles that will lead to more access to better prospects for all ages, but there are circumstances that are not catered for by poorly-worded legislation, which treats the many varied employers as equals. The truth is such broad regulations can be damaging to employers, the economy and, ultimately, the employee.

The FPB is calling for better regulation, worded with the interests of not just the employee, but also the small-business employer at heart. There must be genuine moves to do away with regulation that is counter-productive to its initial intentions and to the economy as a whole.