Small firms fear the new Employment Rights Bill will harm recruitment, according to a survey by the Federation of Small Businesses (FSB).
The research shows that 92% of small employers have concerns about measures in the Bill.
One of the main concerns cited in the Bill is changes to unfair dismissal legislation, which would expand the grounds for employees to take their new employer to a tribunal from their first day in the job.
In addition, 67% said the Bill would see them recruit fewer staff while 32% said they would reduce headcount before the measures become law.
Tina McKenzie, FSB's Policy Chair, said:
'Small firms have made it crystal clear that the Bill will not motivate them to hire more whatsoever. Their feedback is emphatic, resounding, and overwhelming.
'Ministers must show they get the risk to jobs and avoid a cavalier, dogmatic or patronising approach to the loud and clear feedback from small businesses. The economy is in no fit state for a 'war on work'.
'If employers fear they will be sued, fewer will hire – with knock-on effects including a rising benefits bill and a lasting drag on living standards across the UK.'
Internet link: FSB