The Department of Trade and Industry (DTI) has launched a review of the UK's employment tribunal system.
DTI secretary Alistair Darling announced that the review would look at simplifying and improving employment dispute resolution and making the system work better for employers and employees.
Since October 2004, employers have had to follow a set of procedures before they can dismiss or discipline an employee, including holding a formal meeting and offering an appeal.
Employment law expert Martin Edwards of law firm Mace & Jones agreed that a rethink on employment tribunals was necessary as existing regulations were "excessively rigid".
The government is considering making mediation compulsory for certain claims, something which Mr Edwards said that he would cautiously welcome.
"Mediation is well worth exploring in suitable cases. But to make it compulsory would be yet another own goal and would, again, defeat the objectives the government is aiming for," he said.
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