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Small firms need protection against vexatious claims

A business group has urged the Government to do more to help those small employers facing claims from employees who seek to exploit employment regulations.

According to the Forum of Private Business (FPB), there were roughly 1.9 million workplace disputes in the UK in 2008/09.

Research carried out by the FPB itself pinpointed several areas of concern for small-scale employers.

In the latest employment law survey of its members, the FPB found that 92 per cent of those who responded to the poll wanted judges to be given greater powers to 'strike out' weak tribunal claims.

Almost as many (86 per cent) supported a doubling of the deposit and costs limits for vexatious claims.

Some 73 per cent backed more transparency in the process by revealing the amount of compensation sought and details of rejected settlements.

In addition, 62 per cent gave a vote to increasing employee claims eligibility from one to two years, a half (51 per cent) would like to see expenses payments removed from witnesses, and four out of ten wanted judges to sit alone and the introduction of legal officers to make the tribunals process more efficient.

Further, almost a third of respondents (32 per cent) actually welcomed a proposal to introduce financial penalties for employers who wilfully fail to comply with employment law.

However, some firms felt that this enforcement would be better managed outside the tribunal system, while others preferred employment law to be made more manageable before introducing fines.

Phil Orford, the chief executive of the FPB, commented: "There is often a misconception that businesses tend to ride roughshod over the rights of employees but this is far from true for the majority of small businesses that rely on recruiting and retaining key staff in order to grow.

"Clearly, we need companies that do engage in this sort of behaviour to be dealt with, but there needs to be a better balance so that employment law protects smaller employers as well as workers."

Mr Oford added: "We are currently in a situation where employment legislation designed to benefit employees can be a real barrier to creating employment, and favours individual workers at the expense of the rest of the workforce, often even when those claims are vexatious.

"This has to change. We need a fairer system focusing on mediation and conciliation rather than paving the way for disputes to reach the tribunal stage, allowing firms to flourish, create employment and drive economic growth."