Workers are to be given new rights to demand a four-day week in a law planned for this autumn.

The Telegraph understands the system of “compressed hours”, which lets an employee work their contracted week’s hours in four days rather than five, will be included in the package of new rights for workers.

It will form part of a law being championed by Angela Rayner, the Deputy Prime Minister, in close consultation with trade unions as well as businesses.

Currently, employees have the legal right to request flexible working, but there is no obligation on companies to agree.

That balance of power is to be shifted, with companies instead legally obliged to offer flexible working from day one except where it is “not reasonably feasible”.

It means workers will have much greater powers to get bosses to agree if they want to complete their full week’s hours between Monday and Thursday, taking Friday off.

The Conservatives warned that the approach undercuts Labour’s promise to prioritise economic growth and would leave businesses “petrified”.

Kevin Hollinrake, the Tory shadow business secretary, said: “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.

“Labour must listen to businesses who are petrified about day one employment rights and bringing in the four-day week through the back door. It will be businesses and consumers who pay and growth that suffers if they don’t listen.”

Reduced productivity

Critics of the approach warn that flexible working, such as allowing people to more readily work from home, would actually lead to reduced productivity.

But a Labour source close to the plans rejected the criticism, pointing out that the Tories, in their 2019 election manifesto, vowed to make flexible working the “default” and citing studies showing it could improve productivity.

A Labour source said: “The Conservatives pledged to make flexible working the default then failed to do so. We’ll build on their existing legislation to ensure flexibility is a genuine default, except where it is not reasonably feasible for employers to agree.

“Flexible working options such as compressed hours and term-time working can support more people to stay in the workforce and boost productivity, whether keeping parents in their jobs or helping those juggling caring responsibilities for older relatives.”

The working rights package, called Labour’s Plan to Make Work Pay, has been the subject of years of internal discussion and debate with trade unions.

Now they are in government, ministers plan to deliver their promise to submit draft legislation to Parliament making the changes within 100 days of the election, by mid-October.

Exactly how the new approach will work in practice is legally unclear.

Much of the public debate has focused on hybrid working, which lets people work from home, and the right to switch off, which says employees should not be required to respond to emails after they have left work. But The Telegraph understands “compressed hours” will also be part of the package.

That could mean a worker deciding to start earlier and work later for four days a week in order to have the fifth day free.

A Labour source stressed that this was slightly different to how the four-day week is often understood, with someone doing 80 per cent of the work of a usual full week.