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Employment plan to be published

Coalition tensions are set to flare this week when a radical plan for ripping up employment red tape is finally published.

The study by venture capitalist Adrian Beecroft is expected to call for firms to be given more flexibility to make redundancies, and an easing of equality rules to boost job creation.

Some of the proposals will be warmly welcomed by Tories, and there is speculation that David Cameron - who commissioned the research - could signal his support for changes.

But a senior Liberal Democrat source dismissed the 15-page document as "not methodologically rigorous" and merely the view of "one man". "This is not the view of the Government," the source added. "It is part of the evidence that we will be considering as part of the ongoing review of labour markets."

According to the Sunday Telegraph, the reforms urged by Conservative Party donor Mr Beecroft will include an end to a mandatory 90-day consultation period when a company is considering redundancy programmes. Instead he will suggest a 30-day period and an emergency five-day period if a company is in severe distress.

Other measures are thought to include a cap on loss of earnings compensation for employees who make successful unfair dismissal claims. Payments can often total hundreds of thousands of pounds and major reform of the rights that workers are allowed to "carry" to new employers when they are the subject of a takeover. The transfer of undertakings (TUPE) rights can currently create major disparities between workers within companies.

There are also plans to scrap provisions in the Equality Act which make employers liable for claims from employees for "third party harassment" - for example, customers making "sexist" comments to staff in a restaurant and a proposal to shift responsibility for checking foreign workers' eligibility to work in the UK from employers to the Border Agency or the Home Office.

Quoting Whitehall sources, the newspaper said the Prime Minister and Chancellor George Osborne believed the document would show the Government is serious about kick-starting the economy.

The senior Lib Dem source took a thinly-veiled swipe at Mr Cameron's former policy guru Steve Hilton, who left for a job in the US last week. "It is surprising that No10 backs a report compiled by one of the Tory party's biggest donors," the source said.

"But it has been noticeable that since last Wednesday, No10 has been moving towards more evidence-based policy. The reasons for that remain to be determined, but we can assume that as a result reports like this will be a less prominent in the future. The report will be published shortly but will be communicated to Parliament in the first instance."

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