Employment law changes could hit small businesses particularly hard, warns specialist insurer Hiscox.

With maximum compensation awards to workers who have been unfairly dismissed increasing from £12,000 to £50,000, concern is growing.

Employment practices liability underwriter Chris Hill commented: "Concern among small businesses is growing as employment law changes gather pace.

"The scale and complexity of the changes are imposing a huge knowledge burden on many of Britain's entrepreneurs who are not accustomed to making time for regular legal advice and the introduction of in-house systems for resolving disputes.

"We're going to see some big changes in employment practice among small businesses if they are to avoid the catastrophic results of an employment tribunal claim."

He offers the following tips for owners of small businesses who are concerned:
- Update your employment procedures
- Ensure that you take legal advice when reviewing standard employment contracts
- Review employee handbooks and ensure these are distributed to all employees
- Always document employment reviews and disciplinary procedures by taking written notes
- Invite comments from employees before you make any changes to personnel policies
- Check if employees are members of a union before you consider taking any disciplinary action; there may be a need to involve the union in such action
- Ensure that employees are made aware of workplace procedures and apply these in a consistent fashion
- Ensure that you consider purchasing employment practises liability insurance.

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