Dealing with HR and its related issues is seen as a time-consuming distraction by many UK business leaders, with employment legislation voted the principal red tape burden.
A poll of 427 Institiute of Directors members found that health and safety was the second greatest source of concern – principally in terms of its distraction of management effort and its cost.
Other key concerns included the Working Time Directive, payroll processing of social security benefits and the work involved in supplying statistics to the Office of National Statistics and other government agencies.
More than eight out of ten of the business leaders surveyed said that issues such as flexible working, maternity arrangements and employment tribunals were a ‘major’ or ‘significant’ distraction from the central task of running the company.
Four out of ten said that employment law was a ‘major’ distraction, with two out of ten making the same complaint about health and safety legislation.
More than seven out of ten also said that employment legislation was a real disincentive to growing their business and creating jobs.
One respondent to the survey, the managing director of an employment agency supplying the care homes sector, described new regulation in the Care Standards Act 2000 as: “a massive new set of unnecessary regulations….Prices have risen by 6-10% as a result. Recruitment of staff to the care industry has become more difficult.”
But the Chartered Institute of Personnel and Development (CIPD) pointed out that the survey revels the gulf in mindset between many company directors and those concerned with HR, with business leaders needing much more convincing that HR policies can have a real impact on the bottom line.
“There is a difference in mindset between HR and directors that needs to be tackled. A survey of our members in terms of flexible working rights, for example showed the majority thought it was helping to run the business,” the CIPD said.
The IoD’s Director General, George Cox, said: "The first step in tackling red tape is to identify where the biggest challenges lie. This survey does that – it gets down to the detail, for the first time, identifying those areas where rules and regulations affect business. It gives us a clear answer – the increasingly complex system of rules and regulations that employers face for every job they create."
"If Britain is to remain competitive in world markets we must get to grips with these problems.,” he added.