Vince Cable criticises adviser’s report on cutting ‘red tape’

Business Secretary has spoken out against a Conservative-backed report which recommends no-fault dismissals.

Business Secretary has spoken out against a Conservative-backed report which recommends no-fault dismissals.

Adrian Beecroft’s report recommends allowing firms employing less than 10 people to opt out of seven different employment laws for new workers, scrapping plans for equal pay audits and allowing larger companies to give only 30 days’ notice for collective redundancies involving over 100 workers.

The report was published after a leak in The Telegraph which stated that its recommendations included delaying implementation of flexible parental leave until 2017 and not extending flexible working to all employees. In fact, the report published on Monday did not contain these recommedations and Labour has accused the Government of "doctoring it", which the Government denies.

The Telegraph quoted the report as saying: “If flexible working really is good for employers they will adopt it of their own accord, albeit possibly more slowly than if it is forced on them. For some employers it would clearly create real problems and they should not be forced to carry this cost.”

Commenting on the published report, Business Secretary Vince Cable said: “The UK already has one of the most flexible labour markets in the world, as evidenced by the deal struck by the Vauxhall workforce in Ellesmere Port last week. At a time when workers are proving to be flexible in difficult economic conditions it would almost certainly be counterproductive to increase fear of dismissal.

“The Government also has a duty to ensure the labour market provides economic and employment opportunities and has therefore set out a parliament-long review of employment law. As part of that review we have issued a call for evidence on no-fault dismissal for micro firms of fewer than 10 employees. I shall be examining the evidence when this is submitted to me after the 8 June."

He added that the Government has responded to some small business concerns about red tape by, for instance, simplifying employment tribunals with further measures in the planned Enterprise and Regulatory Reform Bill. It has also announced a number of measures for CRB checks, work permits and pensions auto-enrolment aimed at easing the burdens on business. 

On the recommendation for no-fault dismissals, Cable said: “One of Mr Beecroft’s recommendations was a suggestion to bring in no-fault dismissal. In my daily conversations with businesses, this has very rarely been raised with me as a barrier to growth. Businesses are much more concerned about access to finance or weak demand than they are about this issue.”

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