According to research undertaken by the BCC, employment law is a barrier to progress for many companies and 47 per cent of small firms have admitted to having problems working with existing legislation.
David Frost, director general of the British Chambers of Commerce (BCC), accused the government of being too quick to introduce further laws.
Mr Frost argued, however, that by introducing new legislation "it will take longer to get out of recession and companies will be loathe to take on more employees".
He added: "If we are really serious about helping businesses, about creating jobs, why not have a complete moratorium on new employment legislation for the next three years?"
Commenting on the new Equalities Bill, Mr Frost said that this was just another problem for those firms which are struggling to cope with existing employment law.
