According to research recently released by the Forum of Private Business (FPB), small businesses are currently spending £12 billion a year on complying with various statutory regulations.

The FPB surveyed its members in an attempt to ascertain the impact that compliance has on small businesses. Through their research, they found that employers in small to medium-sized firms spend on average 37 hours a month ensuring that they comply with the myriad of regulations that surround the modern workplace.

Health and safety administration is estimated to cost around £1.2 billion, and small companies also find themselves having to deal with tax administration, building and property regulations and equality and diversity policies.

Employment law appears to place the biggest burden on organisations, however, with companies spending £2.4 billion a year to make sure that they comply with regulations that relate to dismissals and redundancy, discipline, absence controls and management, parental leave and holidays, among other issues.

According to the survey, 81% of those who responded believed that the current regulatory framework was damaging and constrictive, with only 9% agreeing that the system was “realistic, robust and fair”.

One FPB member commented that: ““Much of the compliance is to ensure that the correct pieces of paper are in place. It doesn’t mean that it’s done correctly. Systems are too complicated and time-consuming. We should have this time spent on growing our business, which would protect our employees more.”

In an attempt to reduce costs, many companies try to deal with these matters in-house, which can lead to larger problems in the future. Often, seeking qualified legal advice on compliance issues can ensure that things are dealt with quickly and correctly with no further complications.

This leads to long-term savings - particularly in the area of employment law, where failure to comply properly with the relevant regulations can lead to expensive employment tribunal claims.

Technorati Tags: Employment Law, Health and Safety, Regulation Compliance