The government's new Equality Bill could push small business owners ‘over the edge' according to the Confederation of British Industry and the British Chamber of Commerce.

The legislation aims to promote fairness, equality of opportunity and to tackle discrimination. However, with many small firms having to let staff go in the current economic climate there are fears that the legislation may result in a vast rise in the number of claims made.

"The proposals addressing positive action, gender pay reporting and hypothetical equal pay comparators are likely to cause more concern and risk for businesses in what are already difficult times," said Tim Jones, head of the employment department at law firm Higgs.