Red tape 'holds back start-ups'

SOLE traders are "scared" to take on staff and employment law should be changed to help them grow their businesses, according to a serial entrepreneur.

Karen Darby, who sold her Simply Switch business in 2008 for 22 million, said small businesses were "frightened" to hire staff because they might be sued if they fall foul of complex rules and regulations.

She said the coalition government should come up with a new set of more workable rules to cover smaller business.

Darby – who is in Scotland next month to judge Bright Purple Resourcing's contest for entrepreneurs – said: "I'm not one of those who moan about red tape and bureaucracy. I think the UK is one of the easiest places in the world to set up a business.

"But where businesses do suffer is around employment law and how it is now weighted so much in favour of the employee. Entrepreneurs are afraid to employ anyone else because they fear losing everything at an employment tribunal."

In November last year Darby set up Call Britannia, a call centre firm that trains the long-term unemployed.