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Warning over cost of employment law changes


New employment legislation set to come into force later this year will cost businesses £22.87bn, the British Chambers of Commerce (BCC) has warned.


The lobby group has identified seven major employment changes planned for 2011 which it claims will stifle job creation and growth in the UK.


According to the BCC, the most costly reforms include the right to request time off to train and the Agency Workers Directive. It predicts that these measures will have an annual recurring cost to business of £174.96m and £1,548m respectively.


Furthermore, it anticipates that the reforms to pensions in 2012 will leave businesses with a £4,526m bill.


The organisation is now calling on the Government to use next month’s Budget to ‘act on its promises’ and reduce the regulatory burden on UK firms.


‘The Government claims business growth is top of the agenda, yet UK firms will be hit with huge costs once these new regulations come into force,’ said David Frost, director general of the BCC.


He added: ‘Companies cannot generate growth and create jobs when they are facing a £23bn bill, just to implement new employment legislation. Unless the Government reduces this kind of red tape, we will continue to have high levels of unemployment and could end up derailing the recovery.’


However, a spokesperson for the Department for Business said the Government was 'taking dramatic steps’ to reduce the burden on business and remove the ‘barriers to growth’.


‘We are removing or delaying unnecessary measures wherever possible and have introduced the revolutionary one in, one out system that will cut the costs that businesses face in dealing with bureaucracy,’ he commented.