The number of employment tribunal claims fell to 86,816 in 2004-05 from 104,952 in 2003-04, according to the annual report from the arbitration, conciliation and advisory service, Acas.
The most common claims were found to be unfair dismissal and breaches of the Wages Act .
But there was a significant increase in the number of race discrimination claims, from 788 to 2,489.
There was also a substantial rise in the number of equal pay claims, up from 979 in 2003-04 to 6,607 in 2004-05.
Claims under breaches of contract, redundancy pay, sex discrimination and working time all decreased from the previous year.
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In addition to its involvement in these cases, Acas received 1,123 requests for collective conciliation (1,244 in 2003-04), 58 for trade dispute arbitration (69 in 2003-04) and 35 for mediation (one in 2003-04).
The Acas national helpline answered 880,787 calls compared with 796,649 in 2003-04.