Union leaders condemned yesterday’s review of the Employment Relations Act as a sham after all their key demands were rejected. The issue is now expected to be centre-stage at rallies and at this summer’s union conferences. The TUC said it expected thousands to protest in support of greater workplace rights at a May Day rally in London.

Alan Johnson, the Employment Relations Minister and a former union general secretary, said the current legislation was working well and did not need fundamental changes. He said: “With the success of this law, a new culture at work is emerging. Employers and unions are working together.”

But unions say that five million people are suffering discrimination because they work in small companies that do not have to recognise unions.

Brendan Barber, TUC General Secretary designate, said: “While there are some useful advances in this White Paper that will make a real difference to people at work, unions will find the Government’s rejection of many TUC proposals extremely disappointing. The Government would be unwise to ignore the real anger in unions today.”

Derek Simpson, joint general secretary of Amicus, said: “Thousands of working people have been liberated by the Employment Relations Act as many employers have seen the light and come to terms with trade unions. However, millions remain outside the coverage of the Act because of the unjustifiable exemption for small firms.”

John Edmonds, GMB general secretary, said: “The Government has capitulated to the demands of the CBI and left workers vulnerable by not strengthening union recognition rights or protecting workers while they are on a legal strike.”

David Wilson, a sacked NUJ member whose appeal to the European courts led to the UK being found guilty of transgressing human rights, said: “I still do not believe that the Government has fulfilled all the implications of the court ruling on representation rights in Britain. There is still not enough protection to stop firms luring workers away from recognition agreements.”

John Cridland, deputy director-general of the CBI, said: “The unions may huff and puff but most people will see the Government’s decision to leave the key provisions of the act alone as a victory for common sense.”

Unions v bosses: main points of the review

Business wins:

1 Companies with 21 or fewer employees remain exempt from statutory union recognition. A blow to unions, which say the worst employers are the smaller ones.

2 No change to the requirement for 40 per cent of employees to vote in favour of union recognition. Unions argue this is undemocratic because abstentions are counted as votes against.

3 Employers’ right to fire strikers after eight weeks remains. Unions to gain some protection against unscrupulous companies who lock out workers. Such lock-outs may not now count towards the eight-week period.

Union wins:

1 A new legal right for workers to access union services. This is significant and arises from the Wilson/Palmer case over companies that offer incentives for employees to ditch collective bargaining rights.

2 Earlier access rights to workplaces for unions in recognition cases. While not an open door to un-unionised workplaces, this could give unions more ability to organise recognition attempts.

3 Clarification of the right to be accompanied. Workers have a right to be represented by a union representative in disciplinary hearings, but until now it has not been clear that that representative can make a full contribution.