The Government has announced a "root and branch" review of how industrial disputes can be resolved, including moves to simplify employment tribunals.
Trade and Industry Secretary Alistair Darling said productivity could be improved if the number of disputes was reduced.
The review will involve businesses, unions and other interested groups and will be led by Michael Gibbons, a former executive at Powergen.
He will make recommendations for change next spring.
Mr Darling said: "We must make the employment disputes system work better, both for business and employees.
"By reducing the number of disputes, and resolving those that do happen more quickly, we can raise the UK's productivity and ensure better employer relations. We can also cut the cost of dealing with disputes, which can be substantial.
"At the same time, we are determined to protect the rights of employees and ensure that they have access to justice."
