Some 73 per cent of small and medium-sized enterprises (SMEs) admit to dismissing an employee immediately without following the necessary procedures, according to a survey of more than 2,000 respondents by employment law experts Peninsula.

Peter Done, managing director of Peninsula says, ‘Dismissing workers  without following the correct procedure is a time bomb waiting to happen. At some stage an employee will take you to employment tribunal and if you have dismissed unfairly then there is a good chance that you will lose.’

Done adds that employees are more knowledgeable now about employment rights than ever before. ‘In recent years the tables have turned and employment laws favour employees rather than the employer. Unfortunately we see that many managers forget this. You need to make sure your company is up to date with changes in the law and be positive that you have watertight policies and procedures in place to safeguard you and your business.’

The study finds that 82 per cent of employers admit they are not up to date with employment legislation.

The 75 per cent of SME managers that see employee laws as preventing them from growing their business may explain why this is.

Done adds, ‘If the government is business-friendly then it is time to review employment legislation in the UK and look at sensible ways to cut through the red tape. A fair approach should be sought to provide employees  with rights whilst at the same time reduce the procedures that employers have to follow.

‘I speak to many companies that believe they will never be taken to an employment tribunal, sometimes the sad reality is that an employee can  potentially make a lot of money by suing their employer, so don’t give them the ammunition.’