By Marcus Leach

The Federation of Small Businesses (FSB) has expressed concern that Government plans to reform parental leave and flexible working are an example of a contradictory approach to regulation.

While the FSB says it is right to consult on these issues, what businesses need at this time is greater simplification not additional regulation. Last week the Government said it would review employment regulation, and yet this week additions are being proposed.

The Government has committed to reducing the amount of red tape all businesses have to wade through — especially for the smallest of firms. But, in a new report, ‘The Burden of Regulation’, the FSB is concerned that proposing changes to parental leave and the right to request flexible working undermines its commitment to cut regulation and puts small businesses off taking on staff.

The FSB has been calling for a reform to parental leave for some time. However, allowing both parents to take off time in chunks, rather than in one block, would make administration of the leave far more complicated than it already is.

Small businesses are flexible by their very nature and run like a tight-knit family — already offering flexible working to their staff informally. In spite of the Government saying it will create regulations as a last resort, this consultation talks of introducing a Statutory Code of Practice which would formalise the right to request flexible working to all staff. The FSB questions whether this is regulation as a last resort and is concerned it will only add an even heavier burden on small firms.

Additionally, so much of the red tape that burdens small firms comes from the EU — costing businesses €124 billion a year. Unless cutting the flow of regulation from the EU is prioritised, small firms will continue to suffer.

“Freeing businesses from the shackles of regulation is meant to be a key Government commitment," John Walker, National Chairman, Federation of Small Businesses, said.

"Yet only days after announcing the welcomed employment law review, a raft of new employment burdens were announced. It is precisely these types of regulations that will hinder, rather than help, small firms.

"For the Government’s commitment to cut regulation to have a meaningful impact, it is vital the Government shows it is listening. Proposing changes to parental leave and flexible working at such a difficult time will not encourage small business owners to grow and take on more staff.”