New figures from the Federation of Small Businesses (FSB) shows that small businesses will look to shed staff in the first three months of 2012, as it warns that the Government needs to be bolder in its changes to existing employment law to incentivise employment.

Figures from the FSB ‘Voice of Small Business' Index show that a net balance of 6.5% small firms plan to lay off workers in the first three months of 2012 – the highest level since the survey began.

The FSB is urging the Government to ‘think small first' when it responds to the Modern Workplaces consultation. The FSB is specifically calling for:

• Micro firms to be made exempt from the extension of the right to request flexible working for all.
• A complete and simplified reform of maternity and paternity leave in the future – doing so in an uncertain economic environment could harm businesses.
• A micro business exemption from proposals on pay audits which will require employers who lose an Employment Tribunal case to carry out a potentially costly, time consuming and complex pay audit.

Small business confidence plummeted at the end of 2012 as businesses were hit by high inflation, rising utility bills and reduced spending. So the FSB is calling on the Government to act on policies and initiatives already announced to help boost small business confidence so that they can invest and grow and turn this into good news in 2012.