REVOLT AS MPS BACK AGENCY WORK BILL

A total of 136 Labour MPs, including former Cabinet minister Peter Hain, backed the second reading of a Bill which business groups had warned would threaten 250,000 jobs.

Unions were delighted with the support and maintained there was now a "clear and compelling" need for the Government to act.

Labour MP John McDonnell (Hayes and Harlington) said the Bill was a "key test" for many trade unionists to determine whether they stay affiliated to the party.

Despite the Commons vote, the Government is pressing ahead with drawing up a commission, chaired by Sir George Bain, to study agency workers' rights and Gordon Brown will meet unions on Monday to discuss the idea.

Business Minister Pat McFadden told MPs what was really needed was better enforcement of existing legislation and warned of problems with the Bill, including the qualifying period, coverage and how to calculate equal treatment.

The Government had serious reservations about its impact and could not support the legislation but would not oppose it at this stage, he said.

Opening his Bill's second reading debate, Labour MP Andrew Miller (Ellesmere Port and Neston) said it was "morally right" to tackle the "exploitation" of agency workers. Cheered on by Labour backbenchers, he said more rights for agency workers were in the "best long-term interests of the economy".

Tory spokesman Charles Hendry condemned the Bill as "unnecessary and misguided", adding that it would damage labour market flexibility. He said: "Whenever the Government wishes to indulge its passion for dithering and sitting on the fence it launches another commission.

"In this case it wants to say 'yes' to the unions and its backbenchers - but it dares not for fear of upsetting business. It also wants to say 'yes' to business - but it dares not for fear of upsetting the unions and its backbenchers."