A crackdown on companies that have forced people to accept inferior working conditions because of the Covid-19 pandemic has been launched.

Jason Hayward, the labour minister, said action was needed because workers were not regulated, registered or given basic social and employment protections and benefits under the contracts — which often wrongly categorised them as self-employed or contract staff.

Mr Hayward added: “Many employers offer contracts that do not cover basic benefits such as health insurance, social insurance and payroll tax.

“These contracts, usually referred to as independent or consultant contracts, state that workers are responsible for their own benefits and do not allow workers to negotiate their rate of pay to compensate for these statutory deductions.”

Mr Hayward said the Government had amended legislation to allow the manager of the ministry’s labour relations section to issue guidance designed to remove “precarious working contracts”.

He added that the Ministry of Labour would work with the Labour Advisory Council to identify the industries and occupations most affected.