Company directors have told the government that employment tribunals require a 'radical' overhaul.
The Institute of Directors (IoD) said the government's plans to reform the employment system were 'flawed' and would not deter 'spurious' cases.
The IoD said ministers should introduce universal employee deposits for claims and provide tribunals with enhanced powers to dismiss cases.
In its submission to a government consultation, the IoD said the tribunal system had failed, with the majority of employers settling claims in advance rather than face the time and expense of fighting a claim.
More than a third of IoD members said they have had a tribunal claim against them, but of those, only 9% were won by the claimant.
The directors said workers should have to make a financial deposit before making a claim in a bid to tackle the number of weak cases.
Miles Templeman, director general of the IoD, said: "Being timid will get us nowhere. Employment tribunals need radical reform. Unfortunately, the Government's proposals, although well intentioned, will do little to tackle the problem of weak claims.
"What we need are stronger 'strike out' powers for tribunals, universal employee deposits and compulsory pre-claim conciliation. These changes would reduce the number of vexatious claims and the associated costs to business in terms of management time and lawyers' fees."
Copyright © Press Association 2011