The Government is to review areas of employment law including compensation for discrimination and the current 90-day timescale for firms to consult over job losses.
Ministers said they wanted to consult on a number of new areas as part of its "root and branch" review aimed at boosting employment.
The Government said fairness to individuals would not be compromised, but it wanted to make legislation easier and more efficient as well as removing any unnecessary bureaucracy.
Ministers said they will look in detail at reforming compensation for discrimination following concern from employers about the high levels of awards by employment tribunals.
"Compensation levels for cases of discrimination are unlimited and employers worry that high awards may encourage people to take weak, speculative or vexatious cases in the hope of a large payout. This can lead to employers settling such cases before they reach a tribunal," said a report by the Business Department.
Employers were also said to be concerned that the current requirement that consultation over collective redundancy runs for a minimum period of 90 days was hindering their ability to restructure efficiently and retain a flexible workforce.
The Transfer of Undertakings Protection of Employment Regulations (TUPE), which implement a European directive and protect employees' terms and conditions of employment when a business is transferred from one owner to another, will also be looked at after some business groups said they were "gold plated" and overly bureaucratic.
Ministers also announced that next week they will launch a consultation on plans to extend the right to request flexible working and introduce a new system of shared parental leave by 2015 to make it easier for parents to work whilst bringing up a family.
Employment Relations Minister Edward Davey said: "The areas we are reviewing are priorities for employers. We want to make it easier for businesses to take on staff and grow. We will be looking carefully at the arguments for reform. Fairness for individuals will not be compromised - but where we can make legislation easier to understand, improve efficiency and reduce unnecessary bureaucracy we will."
TUC general secretary Brendan Barber said: "We welcome the proposed extension of the right to request flexible working. But we are very worried by the other proposals up for review. Making it easier to make people redundant and giving the workforce less time to come up with alternatives to job losses threatens to make unemployment even worse."