UK Edition
Government launches crackdown on rules which 'stifle' small businesses
The Government is to unveil plans to investigate employment rules that it said could be stifling small businesses and entrepreneurship.
Business secretary Sajid Javid wants to assess the impact of “non-compete clauses”, which can be written into employment contracts and can prevent individuals from competing against their former employer or working for a competitor for a set period of time – sometimes up to nine months after leaving a firm.
Despite the fact that the clauses are only legally enforceable if they protect a legitimate interest, there are suggestions that they can hinder start-ups because they restrict businesses’ ability to hire the best people.
The Government is launching a consultation which asks for views from individuals and employers on whether this type of practice is acting as a barrier to innovation and employment.
Mr Javid is expected to say: “I am clear that I want to see more enterprising start-ups and greater productivity in a free and fair marketplace, by making sure we take action to break down any barriers that are curbing innovation and entrepreneurship.”
He added that the Government wants to work with big firms to create jobs and drive growth, quizzing them about how regulation impacts on how businesses operate.
It also wants to look into how easy it is for business to access finance, and how government procurement could be used to kick-start development of new technology.
Businesses will also be asked about the emergence of new challenger firms and how these can boost jobs.