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New guidance report to save money and boost business confidence

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Issued on 28 Jan 2009 by BERR on behalf of the independent Anderson Review

Small businesses will get a one stop shop for guidance on health and safety and employment legislation, that will help make sure they comply with the law and save them time and money, under new recommendations announced today.

An independent review, undertaken by small business person Sarah Anderson, has recommended a range of innovative solutions to improve the quality of guidance government gives to business. The recommendations are designed to increase compliance with the law, boost business confidence in government advice and cut costs for small businesses. They include:

* a telephone advice service, free to SMEs for the first year, providing tailored and "insured advice" to make sure they comply with employment and health and safety law;
* Government taking responsibility for its guidance, removing disclaimers and encouraging discretion over prosecution of "reasonable" businesses; and
* creating a single access point for all government guidance.

Sarah Anderson said:

"Many small businesses do not use and have little confidence in guidance from government. Where there is good guidance, they don't know where to go. Instead they choose to pay for advice, which they could get free or which might make them do more work than is necessary, to comply with the law.

"Improving the quality of, and access to, government advice is vital if we want to see better understanding of, and compliance with, the law.

"The vast majority of small businesses want to comply with the law. Government should give them a cost effective and efficient way for them to do so."

Almost half of all businesses use external advice about how to follow regulation, spending at least 1.4 billion per year on such services. Some 75 per cent of medium sized enterprises report having paid for advice on employment or health and safety regulation. SMEs are disproportionately represented in employment tribunal applications, for example, with businesses with 50-249 employees generating 21 per cent of tribunal applications but only accounting for 4 per cent of total employment.

In order to redress this imbalance the review focused on improving three areas: providing certainty over outcome; making guidance more accessible; and improving the clarity of guidance for businesses. Other proposals included a 'quick start' summary for each piece of guidance, setting out essential actions firms must follow to comply with the law. It recommended providing a range of channels through which businesses could access guidance, whether electronically, through printed material or face to face contact.

In order to improve the consistency of advice the review suggested a central contact point for reporting inconsistent or inaccurate guidance, with an obligation on government to respond and resolve the issues.

Notes

1. In March 2008, as part of the launch of the Enterprise Strategy, the Government asked Sarah Anderson to "make recommendations on ways of ensuring firms can place greater reliance on official guidance and thereby reduce the cost of compliance."

2. As part of the Review research was commissioned on government guidance from more than 750 SMEs, with face to face discussions with more than 90 small businesses across a wide range of sectors, sizes and at different stages of development.

3. The research highlighted that businesses had the most difficulty understanding health and safety and employment legislation. Firms clearly indicated that they felt government guidance does not provide certainty over whether following it means complying with the law, that they did not understand all of the content and did not know where to find relevant information to help them comply with the law.

4. Small businesses face a greater burden, in terms of costs and time spent per employee, complying with regulation. Almost half of all businesses use external advice about how to follow regulation, spending at least 1.4 billion per year on such services. Some 75 per cent of medium sized enterprises report having paid for advice on employment or health and safety regulation. In addition, SMEs are disproportionately represented in employment tribunal applications. Businesses with 50-249 employees, for instance, generate 21 per cent of tribunal applications but account for only 4 per cent of total employment.

5. BERR has already reduced the administrative burden of employment law on businesses by 418m through its Employment Law Guidance Programme.

6. Guidance and online tools can be found at http://www.businesslink.gov.uk - employing people

Biographical note: Sarah Anderson

Sarah ran her own company for 19 years - Mayday Group - a four branch specialist employment business and agency providing catering staff. At the end of 2004 the business was sold, but she remained a consultant to the business till December 2007.

Her other business interests include being joint founder & Director of Simple Solutions Ltd. which makes folding toddler's loo seats called 'Toodle-loo's' which are sold to the retail industry in the UK and overseas. She is also a non-executive director of JobCentrePlus, the UK's largest government agency.

Until October 2008, she was Director of London Samaritans.

Her other positions include: UK Commissioner for Employment & Skills; Member of Women & Work Commission; Member of the Employment Tribunal Steering Board; Member of ACAS Council; Member the Employment Policy Committee - CBI; and Member of Expert Group for 14-19 yrs., advising DCSF.

In the past Sarah has worked as a small business counsellor in London, and has been a: Member of Small Business Council (May 2000 - June 2004); Member of Better Regulation Task Force (September 1997 - April 2002); Member of Women & Work Commission (Oct. 2004 - March 2006); Member of CBI SME Council (from April 1999 - June 2006 - Chair from Feb. '00 - Feb. '02); and a Member of the Employment Tribunal System Task Force (Nov. 2001 - July 2002)


About the Author

Crown Copyright. Material taken from the BERR- Department for Business, Enterprise and Regulatory Reform replacing DTI - Department for Trade and Industry. Reproduced under the terms and conditions of the Click-Use Licence.


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Article Published/Sorted/Amended on Scopulus 2009-01-29 12:55:02 in Business Articles

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