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Comments

aristeides

An excellent policy with which I heartily agree. If anything, David Cooper underestimates the benefits - the greater flexibility that comes from it will undoubtedly increase employment in the small business sector.

Mark Wadsworth

YES!

Only, with my accountant's hat on, you must realise that there are huge wrangles over who is a small and who is a large employer, e.g. do 40 part timers = 20 full timers? If there are two trading subsidiaries in a group with 15 employees each, that is clearly over 20 in total. But what if those two subsidiaries are completely independent? A car repair business in Norwich and a knitwear shop in St Albans? If they are amalgamated, the shareholders would just have to do a demerger under s213 ICTA 1988. Would you still amalgamate associated companies controlled by the same small group of shareholders?

So I think extend the limit from businesses with under 20 employees to say, businesses with under 2 million employees and have done with it.

a-tracy

This is wrong headed to me, if it is wrong for a 20 person company then it is equally wrong for a 25 person company to be under the burden of red tape and regulations. If we believe that the legislation is wrong for growing businesses then it is wrong full stop.

Where is your incentive to grow? There are many multi-million pound companies with a limited number of employees and some labour intensive businesses that have low profits but a large number of staff that they're keeping off the dole.

The H&S example I gave on David's policy idea yesterday if a perfect example if portable electrical safety checks are important for a ten person office then they're just as important for a lone worker at home. If legislation in the UK is a barrier to enterprise then it is a barrier to all growing enterprises.

Unfair competition in any form is counterproductive. How would you like it if somebody walked into your place of work and said they could do your job at your desk in exactly the same manner with the same competence for 20% less because they're a self-employed single unit or a small partnership that company legislation doesn't apply to - how long would you last?

Denis Cooper

"The fact that EU regulation (e.g. the Social Chapter) was the driving force behind many of these legislative burdens will call for greater political will to put these countermeasures in place and face down the consequential criticism"

You have to distinguish between criticism in the domestic political arena, and criticism in the international political arena, ie mainly within EU circles.

In the domestic arena the main problem would be calibrating the response to criticism. Although public opinion is swinging against the EU, Cameron wouldn't want to encourage the public to draw the obvious and correct conclusion that we'd be better off out of it altogether.

Hence the preferred approach is to lay the blame for the latest stupid regulation at the door of the Labour government rather than that of the EU, following the notorious dictum laid down by the Foreign Office in 1971 (FCO 30/1048):

"There would be a major responsibility on HMG and on all political parties not to exacerbate public concern by attributing unpopular measures to the remote and unmanageable workings of the Community".

In the EU arena it has to be asked whether Cameron and other ministers would have the backbone to defy politicians from up to 26 other countries and tell them that whatever they say the UK is disapplying Community law in these respects, and if the European Court of Justice attempts to impose fines we won't pay them.

If he was prepared for that fight with his EU "colleagues", a measure like the Clause 17 which Bill Cash put down to amend the Legislative and Regulatory Reform Bill would do the job:

http://www.publications.parliament.uk/pa/cm200506/cmhansrd/cm060516/debtext/60516-0111.htm

QUOTE

New Clause 17

DISAPPLICATION OF EUROPEAN COMMUNITIES ACT 1972 (NO. 2)

‘(1) An order made under Part 1 containing provision relating to Community treaties, Community instruments or Community obligations shall, notwithstanding the European Communities Act 1972, be binding in any legal proceedings in the United Kingdom.

(2) In section 1 and this section—

“Community instruments” and “Community obligations” have the same meaning as in Part 2 of Schedule 1 to the European Communities Act 1972 (c. 68);

“Community treaties” has the same meaning as in section 1(2) of the European Communities Act 1972.'. —[Mr. Cash.]

UNQUOTE

Matthew Dear

I agree with many of the comments here: too cadgey! Abolish (or more plausibly review) the whole lot in its application to everybody.

Yet Another Anon

Why not simply abolish The National Minimum Wage, Working Time Regulations, Redundancy, Notice requirements, Statutory Sick Pay, Statutory Maternity Pay, Statutory Paternity Pay, all rights to Trade Union Membership and all rights to paternity leave and scrap Bank and Public Holidays. A lot of Health & Safety Regulation could be scrapped too and things could go back to the old way that there were just inspectorates for public bodies and major industrial installations. And do this for all business whether small, medium or large across the Board - I am sure that less than a tenth of Employment and Business Regulation is actually neccessary.

Yet Another Anon

Major deregulation would be a neccessary pre-requisite for scrapping the dti.

a-tracy

YAA - Abolish what people voted for in 1997 its too late for talk like that! All you can do is try to stop the flood and create a level playing field. Unfortunately like the children who feature on 'Honey We're Killing The Kids, BBC3' many people don't think through the long term consequences of doing what they want to do at the time.

One of the consequences of so much social legislation is that more black marketeering goes on, more self-employment to get around the rules which gives people no protection or security at all and more importing which leads to less wealth creation in our own Country and less taxes being paid from the UK private sector and more people reliant on the State for their income.

If you put too much restriction and risk assessment procedures onto budding entrepreneurs there will be less of them in the future because would you want to take on total responsibility for other adults for example at work functions, or for their weight/stress levels, or how they think and talk to others.

Mark Wadsworth

Can David Cooper comment on the impact that following e.g. YAY's suggestions would have on the fee income of the industrial relations industry?

Yet Another Anon

Abolish what people voted for in 1997 its too late for talk like that!
1997 has been and gone, besides which people voted on a range of issues, the major factor was the relationship between the pound and the ERM, and failures to achieve any coherence in terms of a policy on Europe, in 1992 tax cuts were promised and tax increases were delivered instead.

The only way to do things is to have an approach in which things which would be beneficial to the country are proposed - something like a low level strictly residency based Universal Benefit based on 1948 National Assistance rates updated for inflation with additions for the elderly and the severely disabled, and low interest loans to replace benefits based on benefit costs to cover Education, Medical and Housing Costs with all other benefits and Tax Credits abolished and it is simple - people then have a minimum income so unless they are careless they will not starve and this leaves the labour market regulated in more the same way as the consumer market - an employment agreement would then be more like getting a broadband contract or buying sugar etc.....

I favour heavy state involvement in infrastructure, defence, policing, national security, transport, communications, energy policy but otherwise especially where it is private sector activity surely the government should have an absolutely minimal involvement.

People in 1997 did not vote for more regulation - Labour has been pledging for over 10 years to keep regulation down.

Jack Bains

Many small firms abuse and mistreat their staff. They ignore the H&S and cause problems in their locality because they feel the law does not apply to them. Regulation is needed.

Look at what happened when President Bush did this sort of thing in Texas during his time as Governor. Small building firms were exempt from regulation and compensation claims. Texas is now littered with houses that are badly built and ordinary homeowners are stuck with worthless and dangerous homes as well as big mortgages.

Mark Wadsworth

YAY, thanks for putting in a mention for Universal Benefits!

Jack B, the best guarantee of worker's rights is full employment, and the best guarantee of full employment is low taxes on labour (to wit, scrap National Insurance and have one flat rate for income and corporation tax) and MUCH less regulation. If you are on Universal Benefits plus two thirds of your gross wages and your boss is a sh*thead, you just get a job somewhere else. As to building standards, what does this have to do with employment regulations?

aristeides

"Many small firms abuse and mistreat their staff. They ignore the H&S and cause problems in their locality because they feel the law does not apply to them." Jack Bains.

Obviously, the above policy will not affect these firms which you say are flouting the law anyway. I would strongly encourage you to report them to the police or the appropriate regulatory authorities.

a-tracy

YAA 'where it is private sector activity surely the government should have an absolutely minimal involvement.'

I absolutely agree. I also feel that the contract of employment is the basis of relationship between Employer and Employee no one is enslaved nowadays.

"People in 1997 did not vote for more regulation - Labour has been pledging for over 10 years to keep regulation down."

Ah that chestnut - they have set up the better regulation department at some cost but in October this year they took the responsibility for fire checks off the Fire brigade who used to perform these checks periodically within the charge of your business rates and put the entire responsibility on the business (including the smallest facility). I always liked the back up inspection regime and the discussion about any new precautions with the Fire Officer/s.

Some people never read the small print when they vote and Brown and Blair are like my parents who used to mash up swede and turnip in my mash with a bit of butter in the hope that I wouldn't notice...but just let them have tried to mash in brussel sprouts!

Labour's major manifesto pledge was to sign the Social Chapter and most of the legislation was in there. I feel that one of the only reasons we've kept our opt out choice from the WTD until Jan 2010 is because the self-employed are exempted until end 2009 (but how do you police that anyway?) . Limiting people's free movement, and free will to do whatever work they want to do within health and safety limits wasn't what the employees banked on either.

I've read about companies who have sacked all their workers and re-hired them on a freelance basis. The result the article went on to say were: lower costs, soaring profits and massive growth.

Just a few quotes from the article:

"As for the Company, we saved 20% on our outgoings. The tax advantages of sub-contracting were attractive to say the least.
This model gave us a bit of money to play with. Any company that employs mobile technicians could benefit from the sub-contracting business model. In fact, I'm surprised more businesses haven't jumped on the bandwagon."

With the added benefit of course that you're not responsible for none employees.


Account Deleted

I agree with the initial proposal, but all the stuff about scrapping everything else which it has unleashed is too much.

Workers like to feel secure. This may be a drag on efficiency, but the government should keep some basic minimum regulation (e.g. 20 days statutory holiday, and the NMW).

Scrapping all these things would cause a slight gain in efficiency, but at the cost of general insecurity amongst employees. Now, you can argue tough luck, but I think that there is a balance to be struck. In many areas 'elf and safety' has gone too far. But saying we will scrap all the things YAA suggests would be absolute and complete insanity, particularly electorally.

As for banning people's right to join a trade union - who on earth can believe that conservatives should ban a voluntary association of workers?!?! What are we - 1980's Poland! Ridiculously heavy handed.

Mark Wadsworth

YAA, why are you in favour of government involvement in communications and energy policy? Are you in favour of heavily-subsidised nuclear industry, for example?

I can understand "Heavy state involvement" in policing and defence, because the alternatives are private armies or anarchy!

Denis Cooper

Mark, "the best guarantee of worker's rights is full employment" is spot on, and the main reason why UK business leaders want Turkey in the EU is to provide a fresh source of cheap imported labour once supplies in eastern Europe and the Balkans have been exhausted. The pretext may be that it would help us to export to Turkey, but with countries like Poland the reality has so far proved to be that while we import both their goods and their people, in the main we only export capital and jobs in the other direction.

Yet Another Anon

YAA, why are you in favour of government involvement in communications and energy policy? Are you in favour of heavily-subsidised nuclear industry, for example?
Because if the energy industry grinds to a halt then so does the rest of the economy, I am in favour of funding for infrastructural development such as new nuclear build and new renewable technologies being funded by customers as part of unit costs, higher unit costs also means a rationing of energy use by ability to pay and encouraging more efficent use; the same is true in the Water industry - private companies will have no interest in environmental priorities or maintaining capacity, or indeed in encouraging lower levels of power or water usuage.

Yet Another Anon

As for banning people's right to join a trade union - who on earth can believe that conservatives should ban a voluntary association of workers?!?!
Removal of rights to join a Trade Union as opposed to total banning of Trade Unions is not the same thing - the fact is that this government introduced protections banning employers from sacking someone for joining a Trade Union - is this really a matter for Central Government.

I do favour banning workers from taking Industrial action in certain vital public services and indeed the last Conservative Government talked about introducing such a measure, if people work for the Public Sector then they should not be permitted to take Industrial action - anyone doing so should be considered to be committing treason and measures taken against them directly as a person as well as against any Unions involved.

Jack Bains

"if people work for the Public Sector then they should not be permitted to take Industrial action - anyone doing so should be considered to be committing treason and measures taken against them directly as a person as well as against any Unions involved."

Well done "Yet Another Anon" - there goes another few marginal seats. Would you put senior army officers on trial for criticising the government via the media?

David Cooper

Thanks for the comments so far.

I sympathise greatly with the underlying thought in many answers that it should, as a matter of principle, be no business of the state to interfere in a contract freely entered into between consenting individuals, including a contract of service. In response to the argument that the employee should be favoured because he only has his time to trade for a living, it may be equally forceful to invoke the scenario illustrated in Ayn Rand’s “Atlas Shrugged”, where the men of ability who ran major industries gradually took their minds and experience off the market, resulting in catastrophic economic decline – a graphic demonstration of “who needs who”.

Likewise it is amusing to think of a recent comment in the Telegraph – from Philip Johnston, or was it Jeff Randall again? – to the effect that the “health and safety industry” was invented by the civil servants of the sixties so that their children might enjoy secure employment.

However, let’s not forget that we’re looking for policies for an election winning manifesto. The liberation of small businesses, I suggest, is a sensible small step that can – and indeed should – lead to wider deregulation, but without the political fallout that any more ambitious first step might involve.

Mark W – good point about part timers – I’d be minded to go by headcount alone to keep it simple. I doubt that we should shed many tears over reduced prosperity for the non-productive side of the industrial relations industry, and if that’s widened to cover lawyers too, we can always diversify (I practise commercial litigation too so I’d have no misgivings about a lesser flow of employment work from the liberated small businesses!).

A-Tracy: I take your point and concede that it could be arbitrary, for instance, to exempt a hugely wealthy 19 employee firm and leave the burden on a struggling 21 employee firm. I feel it is simpler to go by headcount rather than turnover. One other point slightly off topic, agreeing with your comment about entrepreneurs, is to scrap IR35 and all associated obstacles but that’s another debate.

Denis – I couldn’t agree more with your comment about how we should tell the EU/ECJ about disapplication of EU law and refusal to pay ECJ fines, whether via Bill Cash’s amendment or otherwise, and again without wishing to stray off topic, the gold plating of EU inspired regulation is a curse that needs a determined effort to remove.

YAA – I’d rather not get onto a debate about trade unions either, given their relative lack of significance in the context of small businesses. At least the days when the likes of APEX could try to force Grunwick to the wall are long gone.


Jack Bains

Just re-reading the original suggestion. It justifies the policy by saying small firms that break employment law may be forced out of business by the fines or compensation and so they should be exempt. I am poor compared to many - can I be excempt from paying car insurance and be given a general exemption from speeding fines, parking tickets etc?

Yet Another Anon

Well done "Yet Another Anon" - there goes another few marginal seats.
What about people relying on services who are badly affected by industrial action - they might well be quite favourable towards such moves, if they are being offered a reasonable deal then most other people will expect them to accept it, the thing is that one major union in a particular sector can bring that bit to a grinding halt which certainly is not popular with the public.

If I recall there was strike action not so long ago affecting a contractor of BA that was quite a small company, surely anyone opposed to Anarchy and Syndicalism would most rationally favour further reductions in power of the Trade Unions - the Trade Unions largely seem to have abandoned the rather positive things they used to do, they used to be a major social and insurance provider, surely it is best to move them back to those roles.

Jack Bains

YAA - are you being funny?
I work in the public sector. I am in a trade union. If I go on strike because my health and safety is threatened by poor conditions or my pay is cut by a below inflation pay rise I should be able to strike without being put on trial for treason.

ukfirst

Little or nothing can be done without leaving the EU.

Perhaps Dave can prove me wrong.
If so, while he's at it, how about repatriating UK fishing waters out to the 200 limit we are entitled to control under internatinal law? Now that would be a blow for freedom.

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