The survey, carried out among 500 SMEs reinforces the need for a new employment law which comes into force in October, says the DTI. The new law makes it mandatory for all employers to have minimum dismissal, disciplinary and grievance procedures in the workplace.
The regulations will place new responsibilities on employers and employees to discuss workplace disputes when and where they happen – disputes that range from pay and conditions to racial and sexual harassment – in a bid to resolve them before going to an employment tribunal.
Employees will usually be required to raise those problems with their employers before they can take a claim to an employment tribunal.
Employment Relations Minister Gerry Sutcliffe said:
"We are introducing these new regulations to provide a framework for employers and employees to handle disputes in the workplace, ensuring that employment tribunals take their proper place as the backstop for individual employment rights rather than the first port of call.
"Employment tribunals have a vital role to play ensuring individual employment rights are not abused. But it is clear that there are too many cases which could be resolved in the workplace ending up at tribunals. This costs time and money, creates unnecessary stress for both parties and slows down the tribunal system."
Other findings from the SME survey include:
Gerry Sutcliffe concluded:
"An employment tribunal claim costs an employer an average of £2,000 in management time and legal fees. Many businesses already have dismissal and disciplinary procedures in place, but for those that don't, the new regulations will help ensure that they avoid unnecessary costs and stress which makes for a better workplace and higher productivity."