BUSINESSES in the south are paying out an average of £138,400 for each employment claim they settle, it emerged today.

The negative impact on profits is obvious - and employment experts have a canny message for bosses: "Make sure you manage staff relations better.''

Findings from a TUC survey has shed light on the general way in which legal claims against firms are going.

In 2001 the average claim was £32,000, compared to the £138,400 last year. This "blame culture'' trend has also seen a seven per cent increase in the number of applications being made to employment tribunals. Claims range from the thorny issue of Working Time Regulations to sex discrimination. According to the TUC, the biggest increase was in claims for breach of contract.

Settlements in this minefield area were worth 13 times as much last year as they were in 2001. One person was awarded £500,000.

Litigation experts say workers have a heightened awareness of their employment rights and have fewer qualms about ensuring these are upheld. Jacqueline McDermott, an employment associate at commercial law firm Penningtons, based in Basingstoke, said: "The results of the survey coincide with the trend we have been seeing here, where we are advising an ever-increasing number of local and national businesses on employment-related claims.''

She added: "It once again highlights the necessity for employers to manage their employment relations in a way that helps to create greater certainly for all.''

Have you had to deal with a frivolous employment claim that came to nothing but proved costly? Let us know by phoning Ron Wain at business South on 023 8042 4491 or e-mail ron.wain@soton-echo.co.uk or write in.