Michelle Rodger: Don't disable the wage payers

WHEN Sir Alan Sugar points his index finger at a doomed apprentice quaking in his or her designer boots, fixes them with a withering stare and shouts: "You're fired," bosses around the country look on with admiration. Indeed, I dare say, envy. If only it were that easy.

Employment law is a veritable minefield of rules put in place to protect employees and employers alike. We all know you can't just sack someone you don't like, or someone who isn't doing their job the way you would like it (unless of course, they have been employed by you for less than a year), and we all agree that legislation such as Transfer of Undertakings for the Protection of Employees (TUPE) is essential to ensure job security when contracts expire and cheaper service providers move in.

There are guidelines to ensure sexual harassment and racial discrimination are prohibited in the workplace, and rules around lone-working to protect employees who regularly work on their own, outside the office, and often in remote areas. There's a minimum wage, pension rights, and innumerable tribunal options for those who feel hard done by.

All in all, while necessary, it adds up to more red tape than could be produced by a red tape factory on a record-breaking red tape manufacturing day. So I'm quite sure I'm not alone in being surprised this week at the TUC's latest report, which claims two million workers in Britain are at risk of exploitation because of their vulnerable work status.

According to the TUC's Commission on Vulnerable Employment, some employees are being paid £1 an hour, some are working 70 hours a week and others face sexual abuse. The TUC said the situation was a "national scandal". The report, Hard Work, Hidden Lives, was researched and compiled by a 16-strong commission, involving employers, academics, trade union representatives and some from a civil society background. Commissioners said they were shocked by the extent of vulnerable work and the fact that much of the poor treatment they found was perfectly legal. The report says employment practices attacked as exploitative in the 19th century are still common today.

What is potentially worse is that women are more likely to face poverty pay and rights abuses as temps, homeworkers, cleaners and carers; 62% of these two million vulnerable workers identified in this report are women.

Which leaves me somewhat uncomfortably on the horns of a dilemma. All employees deserve to be treated fairly and shouldn't be exploited, but I worry about the further impact on employers, especially those running small businesses. It is becoming harder and more expensive to manage human resources within a company, and this clearly affects SMEs, hitting them right where it hurts the most – the P&L. Ultimately it can make it difficult for them to compete.

The last thing they need is the Fair Employment Commissioner making a visit to enforce workers' rights, which is what the commission is recommending. Members have called for a campaign to raise people's awareness of workers' rights, extra funding for bodies such as the Health and Safety Executive, and – this is where I start to get concerned – the setting up of a special Fair Employment Commission to police rogue employers and enforce workers' rights.

I must confess I find it all too much. Too much red tape, too many rules and regulations, too little room to manoeuvre and far too little freedom to do what is best for your own business.

I'm not alone here. Nor is the Scottish Chambers of Commerce convinced that there is any case for spending more taxpayer money on creating new burdens on businesses.

The vast majority of employers operate good working practices, says SCC, and should not be penalised with further red tape. Again, like me, they believe this is the wrong time to be advocating new barriers to growth and employment. My own painful experience of having to fire somebody was less Sir Alan Sugar and more Dame Edna Everage. If it weren't so serious it would have been hilarious. It was a complete farce. Both the employee and I knew he wasn't up to the job. But we both knew I couldn't just fire him. We had to tango delicately around disciplinary procedures and personal development plans, verbal warnings et al. It cost me time and money; it directly affected my customers and prolonged the essential, business-critical process of hiring someone who could actually do the job.

It's from examples such as mine that I believe employment legislation does more to protect 'bad' employees than 'good' ones, and hinders 'good' employers at the expense of 'bad' ones.

There's a very fine balance between the rights of the employee to be treated fairly at work and the rights of the employer to grow a competitive, profitable business. On the one hand, the employee deserves respect and fair treatment, support, encouragement, training and help if they are struggling to cope with the demands the business places on them. But the employer must do what's right for the business, or employees will find themselves out of work anyway.

While the TUC's general secretary Brendan Barber says that good employers have nothing to fear from policies that stop them being undercut by bad employers who break the law or use loopholes to get around it, I think he's not looking at – or not understanding – the bigger picture.

At the end of the day it is, as the SCC says, the private sector and particularly small and medium sized employers that generate wealth and create new jobs in Scotland. And it is these same businesses that will be affected by further changes in legislation. I don't hear the TUC worrying about their rights.