Equality Act shows coalition isn’t serious about deregulation

The Equality Act came into force yesterday. It strengthens anti-discrimination law and will make it easier for members of specified groups to win claims for discrimination, harassment and unfair dismissal. As such, the Act represents a further attack on the property rights of business owners, as well as a significant imposition in terms of the additional costs of legal advice, tribunals and so on.

This type of employment legislation also means that underproductive employees will be retained rather than replaced by more productive workers. The Act will make it even more costly to dismiss members of groups that have effectively been given special legal privileges by the government. The regulatory burden is likely to be disproportionately heavy on small businesses that lack specialist human resources and legal departments.

In the long term, the legislation may well prove to be counterproductive. The risk of costly future legal action may encourage employers to find surreptitious ways of discriminating against members of privileged groups during the recruitment process.

However, perhaps more worrying than the negative economic impact of this legislation is the message it sends about the coalition’s attitude to enterprise. The imposition of significant new costs on firms suggests that, despite some encouraging rhetoric, this government isn’t serious about deregulation.

The sad thing about this particular legislation is that it is completely unnecessary. For example, this recent IEA publication showed that inequality of pay has little if anything to do with discrimination. Attempts to deal with inequality in this way just reduce the range of opportunities available to those groups that are considered disadvantaged.

9 thoughts on “Equality Act shows coalition isn’t serious about deregulation”

  1. Posted 02/10/2010 at 10:25 | Permalink

    I am really worried by the part of this Act that deals with harassment on grounds of causing offence to a person’s belief. Is the article at Equality Act – be afraid true?

  2. Posted 02/10/2010 at 11:50 | Permalink

    So basically the British government made it more expensive for businesses to hire minorities. Sounds like racism in reverse to me.

  3. Posted 02/10/2010 at 11:51 | Permalink

    @John – That part of the Act is indeed particularly worrying. The vagueness of the terms used is also a concern, leaving a great deal of room for the arbitrary application of the legislation.

  4. Posted 02/10/2010 at 17:08 | Permalink

    The coalition seems very poor on this issue of deregulation. Today the “deregulation” of health and safety seemed to have as its main proposal banning something (advertising certain legal services). Everything is seen from the perspective of the man in Whitehall.

  5. Posted 03/10/2010 at 20:21 | Permalink

    The Act may not be perfect in all its details. Cite one piece of legislation in history that ever has been.

    People from minorities that have not been able to fulfill their wishes or ambitions, due to the way the labour market has operated probably do not agree with the views expressed here.

    2.5m people in receipt of incapacity benefit that would like to work might be grateful for the the protections these new laws give them, when applying for roles.

    Though as you correctly highlight unscrupulous, cynical, savvy employers will doubtless find new ways of excluding the “underproductive”, as so euphemistically described above.

  6. Posted 03/10/2010 at 21:00 | Permalink

    Recent research by CIPD, reaffirmed earlier CMI findings on the exceptionally poor quality of leadership and management in the UK. A symptom: 11.4 million employee days lost to work-related stress.

    Leadership and management that led to the
    – virtual collapse in the financial services sector, credit crunch and depression and £155bn deficit.
    – shortcomings in the Gulf of Mexico, and an oil spill.
    – complete hollowing out of British industry since 1980’s.
    – failure of England Football teams in major championships since 1966,
    etc, etc.

    If the whinging, deluded hired and assessed fairly and trained employees well, then productivity and equality would look after themselves.

  7. Posted 04/10/2010 at 10:34 | Permalink

    “Evidence” on stress suggests that the public sector displays far more of it than the private sector. Is this plausible? Is it not more likely that many more people play the system in the public sector, knowing that in a highly unionised environment, and with over-cautious HR policies, they know that they are unlikely to lose their jobs?

  8. Posted 04/10/2010 at 12:43 | Permalink

    I think I can see why the government, with all its influence and coercive powers, should not discriminate between employees. But in competitive markets, why shouldn’t private sector employers be perfectly free to hire, or not hire, whoever they like? Why is it supposed to be undesirable for them to discriminate, say, against Arsenal supporters, or left-handed people, or Bangladeshis?

  9. Posted 04/10/2010 at 23:52 | Permalink

    Mr Shackleton

    Have you learned nothing from the hubris of the Thatcher era?

    Public sector bashing. If recent criticism of Dr Cable’s attack on bankers on this blog is anything to go by, then bashing the public sector should be equally out of line?

    Most of the public sector has already been privatised or out-sourced: rubbish collection & disposal, housing, care homes, cleaning offices, etc – even though the public sector still provides the majority if not all of the funding. That which has not been privatised already will be soon; witness the Suffolk CC proposed model.

    Its just easier hire and fire quickly in the private sector and to mistreat badly in the public sector.

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