Research Shows SMEs Have Varied Understanding of Employment Law

Significant disparities exist between small businesses in their confidence and awareness of managing employment law, according to new research published today by the Department for Business, Innovation and Skills (BIS).

The study, based on responses from over 300 small business owners, shows that:

  • Almost a third (32 per cent) of the total sample, report feeling confident in their understanding of employment law and their role as an employer; however
  • more than a third (34 per cent) of respondents, feel that employment law obligations are ‘not relevant’ to their business; and
  • a further 20 per cent report that they understand their obligations, but worry that they get it right. 

The study also includes an in-depth analysis of male and female variations.

Women place a greater emphasis on keeping up to date with employment law compared to their male counterparts, but worry more that they will get it wrong.  Over half (54 per cent) of women report that they feel it is important to keep informed of changes, compared to 38 per cent of males.

Over a quarter of male small business owners (26 per cent) admit that they don’t keep up to date with employment legislation, compared to a fifth of women (21 per cent). Despite this, over a quarter (26 per cent) of women worry that they will manage it incorrectly compared to 17 per cent of men.

Almost half (42 per cent) of the sample consider it ‘important’ to stay up to date.  However, a quarter (25 per cent) admit that they do not keep up to speed with legislation changes. 

A further 28 per cent report that they are ‘vaguely aware’ of their legal obligations.  This group of employers feel that they are unable to find the time to keep abreast of their legal requirements.

The Government offers free advice, tailored to the needs of small business owners, and simple online tools on the Employing People section of the Business Link website. As an extension of this, BIS launched a new online tool The Employment Law Organiser last September to help SMEs stay up to date on new legislation.

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