Local business leaders have expressed concerns that government proposals to increase the maximum employment discrimination compensation will expose employers to “unsustainable financial risks” and deter investment in workforce expansion.

The Chamber of Commerce carried out a survey of its members, and 150 local businesses shared their views on proposed amendments to Jersey’s employment and discrimination legislation.

The changes – which are due to be debated in the States Assembly tomorrow – were based on a report and recommendations on the island’s compensation awards regime published by the Employment Forum last year, and included plans to increase the maximum compensation for discrimination by an employer from £10,000 to £50,000.

The maximum award for hurt and distress would also increase from £5,000 to £30,000 under the proposals.

But according to the Chamber of Commerce’s survey, 72% of local businesses do not support raising the maximum discrimination claim compensation, fearing it could expose them to “unsustainable financial risks” in increased insurance premiums – deterring investment in workforce expansion.

Over half of respondents also said they anticipate increased expenditure on training, legal advice, and defending claims if the proposals were increased.

According to Chamber, 37.8% of businesses that have previously had to defend such claims incurred costs of over £10,000.

The 24-hour survey also revealed that 60% of employers worry that the changes may encourage opportunistic claims.

“This caution could inadvertently stifle diversity and inclusion efforts​,” said Chamber.

The survey responses also highlighted that employers feel “disproportionately vulnerable” in the tribunal system, with little recourse against false claims.

Therefore, 93% of respondents agreed that the Employment and Discrimination Tribunal should have the power to award costs to employers where claims are vexatious, malicious or without merit.

In a statement, the Chamber of Commerce said: “Chamber urges policymakers to consider these comments and ensure that any changes support both employees and the long-term sustainability of Jersey’s business community in a more balanced approach.

“It is with some surprise that we see huge enhancements of the possible awards for employees, but no protection for businesses enduring spurious claims and counting the costs in dealing with them being included in this proposal.

“These impacts apply across all sectors and all sizes of business, as well as the charitable sector.”

But the CEO of local equality and diversity charity Liberate has spoken out in support of Deputy Lyndsay Feltham‘s proposition, and called for more support to help employers understand the requirements of the discrimination law.

Kaye Nicholson said: “This is an important legislative improvement for those who are at risk of experiencing discrimination.

“There have been some concerns raised about the potential impact on smaller businesses and charities.

“We would strongly suggest, as others have, that rather than seeking to reduce the cap and disenfranchise people who experience discrimination from having a more appropriate level of compensation, relevant support is offered to help those employers understand their requirements under the discrimination law and access training to better improve inclusivity and remove barriers within their workplaces.”

Kate Wright, Founder of The Diversity Network, added: “Supporting Deputy Feltham’s proposition, and the Employment Forum’s recommendations, is an opportunity for our Council of Ministers and States Assembly Members to send a powerful message that in Jersey we value human beings above unethical employers and we want a modern and thriving business community.”

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