Employers will have to offer flexible working hours – including a four-day week – to all workers under government plans.
To receive their full pay, employees would still have to work their full hours but compressed into a shorter working week – something some workplaces already do.
Currently, employees can request flexible hours as soon as they start at a company but employers are not legally obliged to agree.
The Labour government now wants to make it so employers have to offer flexible hours from day one, except where it is “not reasonably feasible”.
It is understood Deputy Prime Minister Angela Rayner is behind the move and wants to introduce legislation on it this autumn after consulting with unions and businesses.
The government has denied employers will be forced to allow staff to work four-day weeks, or make employees work a four-day week.
However, Conservative shadow business secretary Kevin Hollinrake said businesses were “petrified” by the plans.
“Despite warning after warning from industry, Angela Rayner is pressing ahead with her French-style union laws that will make doing business more expensive in the UK,” Mr Hollinrake said.
Tory leadership hopeful Priti Patel said the plan “absolutely sums up this Labour government”.
“Imposing more burdens and bureaucracy and red tape regulation on to businesses, the very people that employ people that get on in life, work hard and this will have devastating impacts for those businesses, but importantly for our economy,” she said.
Charlie Thompson, employment partner at law firm Stewarts, told Sky News: “Employees in the UK already have the right to request flexible working, which includes requesting a four day week, so it’s not yet clear what this ‘new’ law will entail.
“One possibility is for the government to make it more difficult for employers to refuse such requests, because at present it is quite easy for them to do so.”
A Department for Business and Trade spokesman said: “Any changes to employment legislation will be consulted on, working in partnership with business.
“Our Make Work Pay plan is designed around increasing productivity and creating the right conditions for businesses to support sustained economic growth.
“Many employers already provide good, family-friendly conditions for their workers because they know that doing so improves morale and retention.
“We are working in close partnership with business and civil society to find the balance between improving workers’ rights while supporting the brilliant businesses that pay people’s wages.”
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Last year, the largest trial of its kind tested how a four-day week would work, with 54 (89%) of the 61 companies involved still operating the policy a year later.
The study by the Autonomy thinktank found every project manager and CEO consulted said the four-day week had a positive impact on their organisation.
As part of Labour’s “New Deal for Working People”, the government has promised to ban zero-hour contracts, end “fire and rehire” practices and give workers the “right to switch off”.