Reported on Wed, 10 May 2006

Managers of small firms have been warned that they ensure they follow the correct recruitment procedures for all employees so they can defend themselves in the event of employment tribunals, but a business loan could allow small businesses to use recruitment firms to manage their workforces.

New research by the Employment Law Advisory Service (Elas) has suggested that a significant proportion of small and medium-sized businesses do not perform even the most basic checks when hiring new staff, such as requesting CVs.

Elas claims that almost half of all SMEs admit to have hired someone without looking at their CV, something the employment firm describes as "foolhardy in the extreme".

Pam Rogerson, head of recruitment at Elas, reminded managers that having CVs on file of all staff is a fundamental procedure of any business and "essential" to protect against potential damages incurred through employment tribunals.

"The CV is the absolute starting point for any new member of staff, and is the guarantee that can protect the company from a range of legal problems," she said.

Ms Rogerson elaborated: "Whenever you decide not to recruit a candidate - especially a minority candidate - there is the risk that they will feel prejudiced against and issue tribunal proceedings.

"To defend such a case successfully, it is absolutely essential that an employer can prove they have done everything by the book. Employing someone without taking their CV blows a huge hole through that defence."

While recruitment agencies and in-house recruitment staff can be costly, SME managers could use business loans to expand their enterprises without running the risk of potentially damaging employment tribunals.

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