Business leaders in Sussex are calling for action to stop disgruntled employees making frivolous claims against them.

The Sussex Branch of the Institute of Directors wants the Government to deal with the rise in employment tribunal applications and the damaging consequences for business.

It points out there were 161,230 tribunal claims between February 1999 and January 2000 compared to 113,636 claims for the whole of 1998.

Michael Evans, chairman of the loD in Sussex, said: "Employees who have been unfairly dismissed or discriminated against must have a right of redress and the employment tribunal system plays an important part in this. However, the big increase in employment tribunal applications has worrying implications for business.

"Unjustified employment tribunal claims can inflict financial costs on business, harm competitiveness, threaten jobs and distract employers from running their enterprises."

The loD mainly attributes the increase to expansion in the volume of employment law, making it harder for employers to stay abreast of legal developments.

Complex employment law can also cause some employers inadvertently to infringe the law, exposing themselves to tribunal claims.

The fact many small firms lack personnel or human resource departments can lead to failure to establish in-house procedures for dealing with employee grievances. Consequently, a disgruntled employee (or ex-employee) will often seek satisfaction through an employment tribunal instead.

The Government has also reduced the qualifying period for protection against unfair dismissal from two years to one and the ceiling on cash compensation for unfair dismissal has been increased from £12,000 to £50,000.

Mr Evans said: "Steps need to be taken to correct the imbalance."