Business says paternity law will hit hard

Julian Harris
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BUSINESS groups and trade unions clashed yesterday over the introduction of new employment laws.

Over half (52 per cent) of companies say the new regulations, granting extra paternity leave and scrapping the default retirement age, will harm their business, according to a survey. And over a third (34 per cent) said the changes would be “extremely detrimental”.

“In the face of promises by the government to listen to the needs of business and cut red tape, these two new pieces of employment regulation will hit businesses hard,” said David Frost of the British Chambers of Commerce (BCC), which conducted the survey.

However, TUC general secretary Brendan Barber said businesses should be grateful for the regulations on paternity leave.

“The extension of family-friendly working over the last decade has helped to drive record employment rates for working families, which businesses have hugely benefited from,” Barber said.

Four in 10 employers are still unprepared for the changes to paternity leave regulations, according to recent research from the charity Working Families.

The new Additional Paternity Leave regulations allow fathers of children born from yesterday onwards to take a share of the mother’s maternity leave if she returns to work. Fathers can take a maximum of six months paternity leave.

In a further blow for employers, the default retirement age of 65 will be gradually phased out from Wednesday.

In last month’s Budget, chancellor George Osborne unveiled a policy to except some small firms from new government regulations.

“There is some confusion about this,” a Federation of Small Businesses spokesperson told City A.M. yesterday. “We’re still not sure what regulations the proposed three year moratorium refers to.”

“The Budget revealed a policy to exempt start-ups and existing firms with fewer than ten employees from new domestic regulation,” added Frost. “But arguably, any exemptions should include a wider scope of firms, not just micros,” Frost said.