Union leaders clashed over the detailed provisions of the Employment Relations ("Fairness at Work") Bill, but ministers seem to have largely resisted employer attempts to water down the proposals.
The Government was keen to emphasise the "family-friendly" elements of the proposed law, which will include maternity leave of 18 weeks for all employees, benefiting 85,000 women. Maternity leave of 40 weeks will be enjoyed after one year's employment, rather than two years, covering 50,000 more mothers.
Under pressure from employers, ministers withdrew plans to remove any compensation limit for unfair dismissal. Instead, it will increase from pounds 12,000 to pounds 50,000. If a company refuses to reinstate a sacked worker it rises to pounds 64,700.
But employer groups said yesterday the Bill was unnecessary and unwelcome. Ruth Lea, head of policy at the Institute of Directors, said: "The whole notion of compulsory trade union recognition is still unacceptable to us." Many of the family-friendly measures would be a burden on industry, particularly small companies, she added.
The Department of Trade and Industry has made few major concessions on union recognition to the Confederation of British Industry and New Labour hawks in the Downing Street Policy Unit.
Trade unionists believe the membership and rules of engagement of the Central Arbitration Committee, which will police the law, will have a substantial impact. Stephen Byers, Secretary of State at the DTI, said the proposals constituted "fairness not favours. I don't see the Bill acting as a recruiting agent for the unions," he said. "It is no job of a Labour government to be the Fifth Cavalry, rushing over the hill to save unions from declining membership."
Under the proposals, unions will win compulsory recognition if they win a majority in a ballot representing at least 40 per cent of the relevant workforce. Unions with 50 per cent membership will normally be awarded automatic bargaining rights.
The provisions are unlikely to lead to wholesale unionisation - less than a quarter of workers are union members - but they could have a particular impact in some industries such as the service sector and newspapers. Unions have a "hit list" of big companies where they believe they can win a negotiating agreement.
Even where unions are not recognised, employees will have the right to be accompanied and represented by a union official in disciplinary and serious grievance hearings where legal rights are at issue. Until now, in some workplaces their representatives have been discouraged, or even banned.
Mr Byers said the Bill would fulfil the Government's manifesto commitments to provide for the first time all employees with "decent minimum standards", and the proposals would usher in a new era of co-operation between workers and employers.
Ian McCartney, Minister of State at the DTI, who was responsible for most of the detailed work of the Bill, said it would provide "partnership" in the workplace. "We are on the threshold of a renaissance in employment relations," he said.
John Edmonds, leader of the GMB general union, welcomed the Bill as the "first step" towards fairness at work.
But he also wants vocational training to be part of the bargaining agenda where unions are recognised.
Extension of maternity leave to 18 weeks, in line with maternity pay
40 weeks' maternity leave after one year's employment, instead of two
Three months' parental leave, including adoptive parents
Right to return to job, or "suitable alternative"
Time off for domestic emergencies
Compensation of up to pounds 64,700 for unfair dismissal
Rights to compulsory union recognition where there are more than 20 employees if they want it
Shield against prejudice for union membership, or non-membership
A ban on "blacklisting" of trade unionists
Right to be represented in disciplinary and serious grievance hearings
Protection against unfair sacking for those involved in lawful industrial action