In December 2014 Professor Jason Heyes, along with Dr Paul Lewis from the University of Birmingham, co-hosted a one-day workshop on ‘Regulating work and employment: recent changes/future prospects’. The event was attended by representatives of ACAS, the Department of Business, Innovation and Skills (BIS), the CIPD and the Gangmasters Licensing Authority (GLA), as well as leading academics and early career researchers. The workshop was the culmination of a two-year project, funded by the British Academy and Leverhulme Trust, which has assessed the consequences of labour market policy reforms in the EU since the start of the economic crisis in 2008. During the workshop, Jason Heyes, Paul Lewis and Mark Beatson – chief economist at the CIPD – discussed the implications of employment rights reforms for workers and employers while Dr Tim Vorley (Sheffield), Professor Ute Stephan (Aston) and Professor Simon Down (Anglia Ruskin) spoke about the impact of employment regulations on small businesses. Mark Heath from the GLA and Professor Linda Dickens from the University of Warwick assessed long-standing and emerging challenges facing government agencies responsible for ensuring compliance with employment rights while Tony Thomas and Paula Lovitt provided insights into BIS’ review of employment status. We are hosting many slides from this event on Slideshare. Find out more about the Work, Organisation & Employment Relations Research Centre (WOERRC) here: http://www.woerrc.group.shef.ac.uk/

1. situating small business regulation
Simon Down, Jane Pollard, Paul Richter

3. sample includes high-growth firms
Sector Firm Approx size Year founded Location
Bio-Business Bio 1 (bio-tech software development) 30 1989 North East
Bio 2 (drug manufacture) 50 2008
Bio 3 (drug delivery technologies) 15 2002 East Mids
Bio 4 (drug development) 52 2007
Environmental
Services
ES 1 (waste treatment ) 20 2002 North East
ES 2 (environmental testing service) 40 1999
ES 3 (pollution control ) 10 1995
ES 4 (sustainable energy) 20 2007 East Mids
Security S1 (vision technology) 32 1992 North East
S2 (imaging technologies) 40 2003
S3 (clothing/armour protection) 40 1989 East Mids
Film & Media FM 1 (digital communications) 10 2000 North East
FM2 (design agency) 7 1990 East Mids
FM3 (TV facilities company) 7 1998

4. burden – employment regulations
• redundancy regulations
• force employers to act duplicitously – “I did it as
gently as I could but the legal side of it made me act
completely out of character...it made me look really
ruthless” (MD - digital communications)
• create distress – “it was the hardest thing I've ever
had to do” (scientist/HR manager - drug delivery
technologies)
• maternity regulations
• assume the worst of employers – “built on a
premise that all employers are bastards” (drug
development)
• leave firms short-handed
• compensation culture fuels abuse
• dismissal, recruitment...
• issues apply across the sample
• do policymakers have to experience the visceral and emotive nature of complying? Or do
small firms need to be included more in decision-making (e.g. FSB’s suggestion for
Regulatory Policy Committee Plus)?
‘We want to create a
new relationship
between regulators
and businesses
where the default
setting is trust rather
than distrust’
(BIS, 2011)

5. if you believe that small firms are
consumed by dealing with regulation –
think again
• “I don’t notice it in a huge way, if I’m honest.” (Senior Operations Manager,
environmental services)
• “It's not like regulation is a huge issue...and we acknowledge you do need a
certain level of regulation” (Financial Director, bio-tech software
development)
• “it doesn’t take up that much of my time” (Sales Administrator, bio-tech
software development)
• use the existing evidence base that understands firms’ experience
and behaviour (and not over-rely on what firms say – perceptions
and attitudes)
• use research approaches that look at behaviour as well as attitudes

6. if you believe government regulation is the main
way in which firms feel put upon/controlled – think
again
• not just the government, but financial intermediaries
• current and future investors have certain expectations of firms (shaping
behaviour):
• “the management team believed there was a better way of doing it but the
investors wanted it done a different way;…if they want to do it like that it ties us
up in knots, but it’s their money” (drug delivery technologies)
• other firms/parent companies
imposing standards, IT systems, targets, culture:
“I keep thinking that we’re going to plateau out and get used to it but then
something else is thrown up” (sustainable energy)
• small firms themselves – self-imposition
firm culture, growth aspirations and expectations (sustainable energy –
professionalization)
• “regulation” comes at firms from all directions – beware overestimating the
importance of government regulation

7. summary findings
• yes there are burdens
• the usual suspects – employment; uneven enforcement
• and some less well-known – inter-organisational
displacement burdens (corporates passing on
responsibility/cost)
• there’s government regulation and broader forms of
“regulation” (e.g. financial – VCs etc.)
• however, regulation is ordinary and inevitable
structural feature that constrains and enables
• regulation can generate growth