by Ross Clark - Wednesday, 5th September 2007 -

In February, the Department for Trade & Industry published a consultation paper on plans to give working mothers the right to 12 months’ maternity leave, rather than six months as at present.

The government also wants to give mothers the right to transfer some of their maternity leave to their husbands or partners and to grant parents of school-age children the right to demand flexible working hours.

For small businesses, the result is straightforward: extra costs incurred in hiring people to fill in for employees on leave, and huge disruption to projects.

Not that you would pick up any of this from listening to the trade and industry secretary, Patricia Hewitt, mind.

Quite the reverse: according to her it isn’t so much new mums who will benefit from the extra maternity leave as their lucky old employers.

“Employers find greater flexibility suits their business needs well,” she says. “At a time of record employment, and in the war for talent, they attract and retain good staff, matching their business needs with the needs of the individual, which helps generate a more committed working environment.”

I have just one question for Ms Hewitt: if extra maternity leave and flexible working hours are really of such benefit to business, why the need for the government to legislate?

If you could really run shops and factories more efficiently by allowing your staff to set their own working hours to fit in with their lifestyles, companies would have worked it out long ago; there would be no need for nanny Hewitt to tell them what to do.

Of course, the reality is that maternity leave and rights to flexible working hours have a cost, and it is a cost that falls disproportionately upon small businesses.

If you are an overstaffed government quango, it matters not a bit if a few of your staff decide to take a fully-paid, extended break.

Equally, if you are a large supermarket chain you can reasonably easily rejig your staff rotas to take account of the missing employees.

But if you are a small company and half your accounts department goes on maternity leave it is a serious imposition on your business.

In theory the government tests its legislation against the needs of small business. But in practice this amounts to no more than DTI officials dreaming up an ingenious piece of propaganda to make it appear that small businesses are the real beneficiaries.

One of the great advantages of extra maternity leave, stresses the DTI’s press release, is that it will “help employers – particularly small businesses – by giving them greater certainty about when employees are returning to work”.

What this means, when you read the DTI’s consultation document, is that in future mothers will be obliged to give between one and three months’ notice if they intend to return early from maternity leave.

But this is a pitiful concession compared with a proposal buried deep in the document. At present, small firms are able to claim an exemption from the legal requirement to offer mothers returning from maternity leave their old jobs back.

Now, the government plans to extinguish the “small firms’ exemption”. In other words, you could lose your finance director for an entire year and be prevented from appointing anyone else in her place because she has the right to demand her old job back.

Strangely there is no mention of this onerous proposal in the DTI’s press release.

As with so much legislation, the rules have been drawn up using case studies based on huge employers like BT or state bodies like the Central Scotland Forest Trust. Small business have been studiously avoided.

The tragedy is that while the rules are designed to further working mothers’ careers, they will have exactly the opposite effect.

Far from swallowing DTI propaganda, small firms will, for their own survival, be forced to find ways of avoiding employing women of child-bearing age.

It is just as well for young women that there is a vast, overblown public sector willing to take them in.