Small businesses turn to freelancers

(originally published in the London Evening Standard on 20 September 2012)

Lord Sugar may win ratings for saying “you’re fired”, but firms in London are particularly nervous about their ability to dismiss under-performers.

Only one in 10 businesses in the capital surveyed by recruitment specialist Brook Street feels that existing employment legislation is fit for purpose and four in 10 say current legislation deters them from taking on new staff. However, smaller businesses are less worried – because they are more likely to hire a freelancer than a new member of staff.

As a result, only one in 10 of these smaller firms surveyed by NOP is worried about getting rid of new employees. The survey for says that many smaller firms are not concerned about Business Secretary Vince Cable’s proposals to cut compensation for sacking employees, because they have already adopted flexible employment arrangements. More than 60% also disagreed with the Government’s assumption in their consultation on changes to employment law that small business were put off hiring their first employee by the burdens associated with employing someone. The respondents claimed that this was an outdated concept as most were now employing consultants and freelancers rather than full time employees.

According to Matt Barrie, CEO of the survey shows that small businesses are ahead of the Government in employment innovations, saying: “Government is playing catch-up as small businesses change the way they employ workers to suit their needs now, not waiting for the Government to act.”

While the Government changes are welcome, small businesses see these changes as well past their sell-by date.

“Most small businesses are already employing consultants and skilled freelancers as and when they need them rather than worrying about hiring and firing emploees”

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