The credit crunch has prompted a massive surge in claims lodged by employees against their bosses as people face redundancy or problems at work over contracts or working hours.

The rise is adding to delays at the overworked Tribunals Service, already struggling with a deluge of thousands of equal pay cases.

It is also prompting fears of a big rise in levels of awards made by tribunals to compensate people both for delays and the greater difficulties they will face in finding other work.

The figures show that there were 189,303 new claims made in England and Wales in the year 2007 to 2008 - up by 43 per cent on the year before.

But on top of this, provisional tribunal statistics for 2008/09 reveal a substantial rise in claims over redundancy dismissals.

Unfair dismissal is up by 26 per cent, breach of contract by 25 per cent and claims over redundancy payments by 38 per cent.

Richard Smith, head of litigation at the leading employment advisory service, Croner, confirmed that the recession was also pushing up awards to new levels.

"Twelve months ago a 54-year old van driver who was found to have been dismissed unfairly was awarded £3,000.

"That same case now would see a tribunal awarding closer to £20,000 as it recognises his loss is likely to be sustained, due to lack of employment opportunities," he said.

He added: "In the past, if someone was made redundant or dismissed and was able to secure a new job on a similar salary, they would just walk away.

"Now, however, with fewer job prospects, they are looking to blame someone and make up for the shortfall in salary by taking legal action."

At the same time, employment law firms are experiencing a rise of 100 per cent in inquiries from firms and companies seeking advice on defending claims, he said.

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