Business Secretary Kwasi Kwarteng confirmed the Government is looking at scrapping some European Union labour laws, but insisted there would be no “whittling down” of standards.
Measures under consideration using the new freedom to diverge from Brussels as a result of Brexit include the working time directive which enshrines a 48-hour week.
Shadow business secretary Ed Miliband claimed the Government wanted to take a “wrecking ball” to hard-won rights, while the SNP’s Drew Hendry claimed Mr Kwarteng wanted a “race to the bottom in standards”.
Mr Kwarteng told MPs there would be no “bonfire of rights” but confirmed EU-derived labour laws were being examined, as first reported in the Financial Times.
“I think the view was that we wanted to look at the whole range of issues relating to our EU membership and examine what we wanted to keep, if you like,” he said.
But he said “the idea that we are trying to whittle down standards, that’s not at all plausible or true”.
Appearing before the Commons Business, Energy and Industrial Strategy Committee for the first time since taking up his role, the Business Secretary said: “I’m very struck as I look at EU economies how many EU countries – I think it’s about 17 or 18 – have essentially opted out of the working time directive.
“So even by just following that we are way above the average European standard and I want to maintain that, I think we can be a high-wage, high-employment economy, a very successful economy, and that’s what we should be aiming for.”
Mr Miliband said: “After dismissing media reports and promising the Government has no plans to rip up workers’ rights, Kwasi Kwarteng has now let the cat out of the bag and admitted that they are conducting a review of those rights – including opting out of the 48-hour week which protects workers in key sectors like the NHS, road haulage and airlines from working excessive hours.
“A Government committed to maintaining existing protections would not be reviewing whether they should be unpicked. This exposes that the Government’s priorities for Britain are totally wrong.”
Business department officials stressed that there was no formal review as claimed by Mr Miliband.
Mr Hendry, the SNP’s business spokesman, said: “If the Tories were intent on protecting workers’ rights then they would simply maintain those that were already enshrined in EU law – rather than ploughing ahead with a review and selecting what they want to keep.
“The harsh reality is that the Tories’ empty pledge to protect rights is, as feared, nothing more than smoke and mirrors – with this review paving the way for an assault on protections that millions of workers depend on.”
Meanwhile the European Union’s ambassador to the UK, Joao Vale de Almeida, said Brussels could retaliate under the “level playing field” commitments in the Brexit trade deal if Boris Johnson’s Government decided to turn the country into a Singapore-style low-tax, low-regulation economy .
“The issue is well organised in terms of the deal to allow us to address some divergences that may come up, but that’s the choice of the UK – how far they want to go on that,” he said.
“It will be for us to judge the extent to which it violates this principle of ‘level playing field’ and if that is the case there are mechanisms in the treaty, in the agreement, that allow us to discuss and eventually to come to an understanding – if no understanding there are retaliation measures that can be applied on both sides.”
Mr de Almeida also addressed the issue of financial services – where Mr Johnson admitted the deal had not gone as far as he would have liked – insisting that was not an attempt to punish the UK.
“We are not in the business of punishing,” he told a Bright Blue think tank event.