Awareness of complex new Dispute Resolution regulations that come into force this week is worryingly low amongst employers, Britainís biggest business organisation has claimed.
According to the Federation of Small Businesses (FSB), one of the most significant changes that employers have faced in the last ten years has not been accompanied by a large scale awareness campaign.
In comparison, the new disability regulations that come into effect on the same day have been widely promoted.
They regulations will introduce a new three step procedure that requires employers to put any disciplinary issue in writing as a first step rather than speaking to the employee, meet and discuss the issue and then give the employee the right to appeal.
They also impose a statutory 13-step process that employers must follow in order to dismiss a member of staff.
According to the FSB, the new grievance rules seem straightforward, "but they will fundamentally change the way that employment issues are handled in the workplace."
And as result of formalising issues at the earliest stage, the FSB claims that the regulations will actually increase the risk of conflict.
Employment Lawyer Murray Fairclough said: "The rules represent the most significant piece of employment legislation in the last decade, affecting the way in which almost all dismissals and grievances are handled in the workplace.
"Unwary employers could easily find themselves falling foul of the rules. They donít just apply to conduct and capability dismissals but also to redundancies, long-term incapacity dismissals, expiry of fixed term contracts and retirements. In addition they apply from day one and so still need to be followed when dismissing an unsuitable probationer.
"If the employer fails to follow the procedure, the dismissal becomes automatically unfair, and any additional compensation can be increased by up to 50 per cent.Ē
FSB policy chairman John Walker said that while the objectives for introducing the legislation were sound, their effects had not been thought through.
"As with so many well-intentioned initiatives the complexity of the regulations make them a potential minefield for small firms. The new rules will have a wide-ranging impact on the way employers do their business and we are concerned that this impact has been under-estimated," he said.
Last week, employment lawyer Steven Lorber from Lewis Silkin said that the rules on sacking employees would prove to be a litigation bonanza for disgruntled staff.
"This is potentially a complete nightmare for employers," he said. "The employee will know that if they can find any fault with the way the employer has followed the procedure, they will be home and dry."