Commenting on proposals on unfair dismissal mooted by Business Secretary Vince Cable today, Mark Littlewood, Director General of the Institute of Economic Affairs, said:
“The government’s new proposals on employment law represent a step in the right direction, but definitely not a leap.
“Many of the present rules surrounding redundancies and dismissals are burdensome on employers and frequently tortuous and agonising for employees. They need to be rationalised. But today’s ideas do not go far enough.
“Vince Cable says he doesn’t wish to create an environment of ‘hire and fire’, but more needs to be done to create an environment of ‘hire’. If employees are difficult and expensive to remove from the payroll, companies will be less willing to recruit.
“The evidence is that the private sector is demanding more labour, but is tending to meet this through extending existing working hours rather than taking on new staff. With very high levels of unemployment, especially amongst the young, the government needs to look again at abolishing or suspending the national minimum wage as well as tackling equalities legislation which can often give rise to vexatious claims.
“Although these proposals are timid, they represent a reasonable start.”
To arrange an interview with Mark Littlewood, IEA Director General, please contact Nick Hayns, Communications Officer, 020 7799 8900, firstname.lastname@example.org .
Notes to editors
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.
The IEA is a registered educational charity and independent of all political parties.