Kwasi Kwarteng: ‘We wanted to look at the whole range of issues relating to our EU membership and examine what we wanted to keep’ © Tolga Akmen/AFP/Getty Images

Business secretary Kwasi Kwarteng on Tuesday confirmed the government had begun a post-Brexit review of UK employment law, but insisted it would not lead to a reduction in workers’ rights.

The Financial Times reported last week that employee protections enshrined in EU law — including the 48-hour working week — could be torn up under plans being drawn up by the government for an overhaul of employment law.

Downing Street on Friday declined to confirm or deny the FT report, but Mr Kwarteng on Tuesday said the government had embarked on a review of UK employment law.

He told MPs it was not true the government wanted to “whittle down” labour market standards, but he said Britain’s departure from the EU provided an opportunity to assess which European regulations the UK should retain.

“We wanted to look at the whole range of issues relating to our EU membership and examine what we wanted to keep . . . we’re absolutely committed to having a really high standard for workers,” Mr Kwarteng told the House of Commons business select committee.

The FT reported last week that the business department had been authorised by Downing Street to look at a shake-up of employment regulations.

Officials at the business department are examining the case for scrapping the 48-hour working week that is included in the EU working time directive, a move that would mark a clear divergence from European labour market standards.

The officials are also considering not including overtime pay when calculating some holiday pay entitlements, and ending the requirement for businesses to log employees’ working hours.

Ministers have not yet given their approval to any of the proposals being drawn up by officials.

Mr Kwarteng told the business committee the idea of “some sort of bonfire of [workers’] rights” could not be further from the truth. “We feel that we are enshrining rights, and we can protect rights,” he said.

The business secretary also claimed that the UK had maintained high employment standards despite being one of 17 or 18 EU member states that “essentially opted out” of the bloc’s working time directive.

“And I want to maintain that. I think we can be a high-wage, high-employment economy, and a very successful economy,” he said.

But shadow business secretary Ed Miliband said Mr Kwarteng was factually wrong, claiming only five EU member states — previously including the UK — had a “generalised opt-out” from the EU working time directive.

A further 11 EU member states have more limited opt-outs for certain industries and various occupations.

The British opt-out was secured by former Conservative prime minister John Major in the 1990s, and means that individual employees can request an exemption from the 48-hour working week.

Mr Miliband said Mr Kwarteng’s comments to the business committee meant the government had finally “let the cat out of the bag” after dismissing the FT report last week.

“A government committed to maintaining existing [worker] protections would not be reviewing whether they should be unpicked,” he added.

The row over comes as the government considers what regulatory reform to proceed with now the UK has left the EU.

Boris Johnson this month asked business leaders to come up with ideas about how to change regulations to support economic growth.

But business groups have said they are not looking for any deregulation that could sour relations with the EU.

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