Present employment regulation in the UK is not excessively burdensome on employers or a threat to UK competitiveness, according to the Trade & Industry Select Committee.
However, the committee, which advises the government on UK employment policy, said future regulation should only be introduced where there is a clear problem identified which can only be remedied by regulatory intervention.
In the Report on UK Employment Regulation, the committee said it was not convinced by the arguments for retaining the opt-out from the Working Time Directive, which has enough flexibility to accommodate the needs of business.
It also found the right to request flexible working for the parents of young children had been well received and the proposal should be extended to all those with caring responsibilities.
With the numbers of working mothers rising and an ageing population, employers will find that accommodating the caring obligations of their employees is a necessity, not a luxury, the committee said.
Martin O'Neill, chairman of the committee, said employment regulation has been contrasted with flexibility for too long.
“In reality, regulation need not mean inflexibility - individual regulations should be judged on their own merits,” he said. “Future regulations should be designed with the goals of the Lisbon Strategy in mind.”
The Lisbon Strategy is a commitment to bring about economic, social and environmental renewal in the EU.