The Forum of Private Business has welcomed the introduction of employment tribunal fees from 29 July - but says it does not foresee them bringing about a major change in the system.
The fees will apply for any case lodged from 29 July and are set at two levels, depending on the type of claim being made.
All applicants will be required to pay an issue fee to raise a claim. This will be followed by a hearing fee if the case is referred to a tribunal for a formal hearing.
The annual cost of running the tribunal service currently stands at £84 million and the government expects the introduction of fees will go some way to reduce this by encouraging alternative dispute resolution.
Research undertaken by the Forum of Private Business shows that smaller businesses without a formal HR department are more likely to resolve disputes at the mediation stage; 80-85 per cent of workplace disputes in small firms are resolved internally.
FPB chief executive, Phil Orford said: "Escalating workplace disputes to the tribunal stage is too easy an option for many employees. The burden on the employee is limited whilst employers are not only defending the case in question, but also the reputation of their business.
Hopefully the introduction of fees will make claimants think more carefully before resorting to litigation.
"Our members recognise that employment law is there to protect both the employee and the employer. But when weak and vexatious claims are being made against employers the system is being abused at considerable expense to small businesses employers; they do not have the time, resources or the money to defend vexatious claims and in many cases should not have to."
Research published by the Forum last month revealed employers spend an average of 12 hours a month on employment compliance alone.