Should employers be able to sack people more easily?

This is a very tough question that the BBC are exploring on Radio 4’s Sack ‘Em programme.

Some believe that employment law is now so complicated and slanted towards employees that employers end up “paying off” people they should be sacking. Other people are much more worried about the huge power firms already have over workers’ lives and think that staff need even more protection. Both arguments have some merit.

According to the programme in the public sector moving people sideways instead of sacking them is “incredibly common”. However, in the Department for Work and Pensions, one of the largest parts of the public sector, in 2009/10 1,131 people were sacked - almost 1% of the workforce. The year before another 1,192 were sacked. Only a miniscule proportion are sacked for being incompetent, however.

Private employers’ organisations like the British Chambers of Commerce are very critical of the current system of employment law. It believes the law changes so often and imposes such costs most of the time employers “only know that the law has changed when they get a claim coming through from an employee that said they didn’t do something that they should have been doing”.

Interestingly, the public appear to back the Chambers of Commerce position. In a recent poll, 57% of people agreed that “employment law provides too much protection to employees who perform or behave badly at work.”

However, in 2009 half of businesses who defended a case in front of an employment tribunal hearing won. And the Trade Union Congress (TUC) believes that settlements are often made when an employer has got it wrong, realises it, and rather than spend money on lawyers, decides to settle with the employee.

According to the BBC the government is now considering two options to deal with the problem of expense and complexity: introducing fees for people who bring cases to tribunal (to cut down on false claims) and insisting that all cases go to ACAS before tribunal.

This debate will run and run. Perversely, it may be the case that making workers easier to fire is in their general interest – as it will act as a significant incentive for firms to hire in the first place.