An influential business group has proposed that government should only regulate once in any one area of employment law every parliamentary term.
The Forum of Private Business (FPB) said the move would help small firms to grow by reducing red tape.
According to FPB, complying with new regulations cost small and medium-sized enterprises about £18.2billion last year – that is £14,800 per business.
“This is a significant increase since 2011 despite positive government efforts to reduce the cost of regulation,” it said.
FPB chief executive Phil Orford added: “The coalition government intended to be the first government in history to reduce – not increase – the overall burden of regulation.
“There have been some very positive changes to the way regulations are made, tested and implemented, but to date businesses are not feeling the benefits.
“This suggests there is a clear mismatch between the positive deregulatory work of the government and the increasing cost of compliance for businesses. This is undoubtedly down to the continuous flux of regulatory change.”
FPB said employment law changes cost £4.7billion in compliance costs last year.
Rules on parental leave have changed, on average, every 18 months since 2002.
“It is quite possible that an employer could be managing staff absences under multiple pieces of legislation at the same time,” FPB said, adding: “Next year, a further change allowing shared parental leave is likely to cause further upheaval and cost.”