The Government's announcement that people taking companies to employment tribunals must pay a fee they only get back if they win has been hailed as "long overdue" by West Midlands' chairman of the Institute of Directors John Rider.

And he also approved of the decision that two years' service should be required before a case can be brought.

Mr Rider said: "The IoD has long called for a modest charge for bringing a case to an employment tribunal, and this announcement is a vital step to ending the 'no win, no fee' employment law culture that has frightened so many businesses into recruitment inertia. 

"We also welcome the extension of the qualifying period for unfair dismissal claims from one to two years. Both these measures appear good for employment prospects. But there are many more employment laws that increase the cost and risk of taking on people, and these also need to be looked at."

Mr Rider maintained the legislation had been 'holding back' the regional economy and job creation.

"This will hopefully encourage people to take on newcomers rather than get extra work done on overtime or by temps, as is all too often the case now," he added.