Many small firms may be completely unaware of the legal changes that have just come into effect, and could face prosecution as a result, according to the Forum of Private Businesses.

The key legislative changes which business owners need to be aware of are:

• An increase in statutory sick pay, taking the weekly amount employers have to pay staff on sick leave from £79.15 to £81.60.
• Alterations to the way National Insurance is calculated and the rates at which it is paid – employers will need to look at this in more detail.
• The effective ending of an employer's ability to issue six-month notifications of retirement using the statutory retirement procedure. The law still gives provision for some businesses to have a set retirement age but only if they can justify it objectively – generally only on health and safety grounds.
• The creation of an employers' right to use positive discrimination as a tie-breaker when making decisions on recruitment and promotion.

Forum Chief Executive Phil Orford said: "When you're busy running your own business, keeping abreast of the latest tweaks to the complex regulatory system can seem like the least of your worries.

"However, any instances of a business failing to comply with a piece of legislation can have serious financial consequences, no matter how unintended or trivial the breach is. As a result, I would urge all business owners to familiarise themselves with changes to the law and seek professional advice if they are unsure what they need to do to comply."