Mixed blessings of red tape

Ahead of Thursday's green paper on parental leave, Business Europe talks to Peter Done, managing director of the UK's leading employment law consultants Peninsula Business Services.

As small businesses struggle to cope with an ever-growing volume of employment legislation, there's at least one person out there who benefits from red tape. He's Peter Done, Managing Director of Peninsula Business Services, who have been offering legal advice to businesses since 1983.

Based in Manchester, Peninsula now has a 9,000-strong client base, many of them small businesses seeking advice on how to manage their staff efficiently and legally. Thanks mainly to New Labour's penchant for employment legislation, Peninsula claims to have seen a 39% increase in calls to its employment hotline in the past year.

Legislation is coming in too fast, says Done. But the government is now realising what it's been doing, he adds, referring to Tony Blair's headline-grabbing declaration of war on red tape on November 27.

Over-regulation is, of course, good for Done's business, if not for anyone else's. Before Peninsula, he was running a chain of betting shops with his brother Fred. When they took over a company of ten shops, one employee hell-bent on redundancy made matters difficult for her new bosses.

She had a contract of employment that was different from ours, Done explains. After many weeks of negotiation with herself and our lawyers we had to dismiss her. This resulted in an employment tribunal, even though we had taken advice all the way throughout the process.

On the day of the hearing, the tribunal was scrapped in favour of an out-of-court settlement which resulted in a loss of over £7,000 to both the ex-employee and the lawyers.

We thought there had to be a better way of doing things, says Done.

And so the brothers formed a consultancy, specialising in employment law at first, and adding health and safety afterwards. After a slow start the company gradually established a reputation, and in 1987 Done got more closely involved.

Done is a firm believer in employees' rights, and in contrast to many employers, he supports a good many of the regulations that the government has introduced in the last three years. He also believes that the secret to good relations between bosses and staff is good communication.

A happy workforce knows where they stand, he says. A lot of recent regulations have been reasonably good and quite fair. The problem comes in the way the regulations have been piled on top of each other in such a short space of time.

The effect of Labour's legislative drive has yet to be felt fully, but 2001 promises to be another busy year, Done says. He cites the Human Rights Act and trade union recognition in traditionally non-unionised sectors as the big issues to watch out for in case law over the next few months. He's also keeping an eye out for the government's eagerly anticipated green paper on parental leave, due out tomorrow (Thursday).

The document, which calls among other things for a two-week increase in paternity leave, sets out the government's long-term plans to shore up employee rights. If implemented, this will also generate some more business for employment law consultants.

But Done is adamant that nearly all employment disputes are avoidable, despite recent increases in legislation. You've got to have a certain common sense and some knowledge of how to motivate people, he says.