4 pieces of red tape entrepreneurs hate

With just over a month until the election, we round up views from British business owners on the bureaucratic gripes they want the political parties to address...

Starting a business comes with a host of laws, codes of practice and regulations that need to be followed but not all government bureaucracy is met with approval from the entrepreneurs that have to implement them.

In light of the upcoming general election on May 7, we’ve gathered opinions from a handful of successful British entrepreneurs on four pieces of red tape that they feel most hamper business growth and would like to see addressed.

From sourcing finance and paying company taxes to rules on paternity leave, the UK’s business owners aren’t shy when it comes to expressing their issues with red tape. Many company founders share similar bureaucratic complaints while, in contrast, others such as Charlie Marshall of Loaf and Charlie Bigham of eponymous food brand Bigham’s say they have been unaffected – “people moan far too much about it”.

Cameron, Miliband and Clegg take note…

1. Employment regulations

Lesley Reynolds, co-founder, Harley Street Skin Clinic:

“Employment laws need to become more balanced and they should protect both the employee and the employer. Sometimes it feels like the employer is not well served”.

Rupert Lee Browne, founder, Caxton FX:

“Whilst we pride ourselves on being a great employer, dealing with a company of people can have its challenges. And the increasing regulatory burden only takes more time and expense.”

Duncan Cheatle, founder, Prelude Group:

“EC imposed employment regulation [is an issue]. For anyone who has faced a vexatious claim on the grounds of discrimination it is soul destroying and very often a real hindrance to growth as the payouts can be big. The fundamental issue is that claims are uncapped so there is no way of assessing the risk and lawyers always encourage a settlement.”

Simon Woodroffe OBE, founder, YO! Company:

“[UK] employment law does not foster honesty and excellence.”

2. Funding

Rune Sovndahl, founder, Fantastic Services:

“There is a huge issue with how entrepreneurs get funding and assistance. We launched during the recession and grew organically through hard work and now it seems that competitors are receiving money quite easily. Allocation of funding seems random as well as valuations of current companies and that puzzles us.”

Ross Marshall, co-founder, Your Golf Travel:

“There is a lack of start-up funding from traditional methods due to the high risk profile of new businesses yet crowd and cluster funding has helped fill a gap in the market.”

Paul Sulyok, founder, Green Man Gaming:

“The UK games industry has been hampered by lack of funding for many years, and this does have a knock-on impact for our business. We welcome plans for tax breaks for our industry and hope to be able to support many more UK developers and games studios which will help us grow our catalogue and further improve our offer to millions of gamers worldwide.”

Chris Ash, founder, Ash Gaming:

It is generally pointless talking to banks in the early stages.”

3. Shared parental leave

Charlie Mullins, founder, Pimlico Plumbers:

“The worst piece of red tape so far is Clegg’s parental leave law. By the stroke of a pen the coalition has massacred small businesses with a universe of bureaucracy that will cause as much turbulence in its administration as in its practice. I’m in no way against equality but I am not happy that under these new laws twice as many workers as before can now come and go as they please, regardless of the impact to business.

“Although most of our plumbers are male, our office is made up of majority female staff. In fact, being a family business, we have several couples who work together on our workforce as well. If everyone at Pimlico Plumbers took advantage of the shared parental leave of up to 50 weeks and several staff took this leave at the same time, how could we be expected to function?”

Lara Morgan, founder, Company Shortcuts:

“I object to new paternity and maternity rules. They can destroy small companies as a burden and should be made different for companies with under 20 people.”

4. UK broadband

Heather Baker, founder, TopLine Communications:

“We’ve moved twice since we started and on both occasions it’s been extremely difficult to get basic phone and broadband service set up. It would have been seriously detrimental if we didn’t have a good continuity plan in place.

“I launched TopLine as a naïve 27-year-old in the teeth of 2008’s financial crisis but the biggest challenge I’ve faced since hasn’t been un-interested bank managers or late-paying clients, it’s been BT’s inability to furnish us with the internet and telecoms facilities for which we have paid good money.”

Share your views on the pieces of red tape that you hate below, or for more information on red tape and legal issues, click here.

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  1. Simon Jones - Ariadne Associates
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    As an HR consultant who works with small business and start-ups, I feel I need to comment on points 1 and 3.
    Unless you’ve just recycled quotes from the 2010 election, the first point demonstrates a very worrying lack of knowledge among entrepreneurs. Aside from the fact that employment law is has been “rebalanced” over the last 5 years, one of the big changes is that the number of tribunal claims has fallen by 70% – one estimate I saw was that a small firm is likely to face a tribunal claim once every 45 years. The fact that some entrepreneurs continue to believe employment myths peddled in tabloid newspapers doesn’t bode well for the success of their business.

    On Shared Parental Leave, you seem to have selected quotes from someone with a party political axe to grind (otherwise why mention Nick Clegg?). The system has even started yet and it doesn’t double the number of people eligible (most fathers have had rights to take an extended period off since 2010) – what it does is to allow it to be taken more flexibly, and in certain circumstances employers can refuse it. At this stage we don’t know how many people are likely to request it, but based on past experience I’d be amazed if it were a huge number