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Changes to paternity leave and the default retirement age have caused considerable concern for many businesses. The changes have arisen despite the promises by the coalition government to reduce red tape for business. Although companies with less than ten employees will be exempt from domestic regulation, the new changes will apply to all companies, with a greater impact on small business.

The default retirement age will be scrapped with effect from 6th April 2011. Changes to paternity leave will allow fathers of children born 3rd April 2011 or later to take any maternity leave not used by the mother, which could result in up to six months off work, receiving additional statutory paternity pay. According to an ongoing survey of 1300 businesses conducted by British Chambers of Commerce, 52 percent of the companies expect the changes to paternity leave to have a negative impact upon their business, with 34 percent expecting the impacts to be extreme. A fifth of the companies felt that removing the default retirement age would be harmful to their business.

The new paternity leave changes could make it more difficult to manage the workforce, with additional planning by businesses required. Employees wishing to work beyond the age of 65 could cause problems when managing performance, especially in manual jobs. Small businesses will especially feel the effects of these changes to legislation. Outsourcing to a small business accountancy will allow you to cope with any rise in demand for paternity leave. A low cost accountant could also help you to plan workforce changes if employees wish to work after the age of 65, allowing you to benefit from the experienced workforce.

About The Author

Gary Fields

Content Writer working alongside our expert accountants to bring you the latest Tax and Accounting news.

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