Conservative and Liberal Democrat peers have been accused of trying to block stronger rights for millions of workers amid a growing campaign by business leaders to water down Labour’s zero-hours contract plans.

In a blow for the government, the Lords last week voted to curtail the manifesto promise to give workers a right to a guaranteed hours contract and day-one protections against unfair dismissal.

Setting up a showdown with the upper chamber, the Lords passed a series of amendments to the employment rights bill that will must be addressed by ministers when MPs return from their summer break.

In an angry intervention on Monday, the general secretary of the Trades Union Congress, Paul Nowak, said the Lords was “doing the bidding of bad bosses” and ought to “get out of the way” of the plans.

“The sight of hereditary peers voting to block stronger workers’ rights belongs in another century. It’s plain wrong,” he said.

Under the Lords’ amendments, a requirement for employers to offer zero-hours workers a contract covering a guaranteed number of hours would be shifted to place the onus on staff to ask for such an arrangement.

Protections against unfair dismissal from the first day of employment – which the government plans to reduce from the current level of two years – would be extended to six months, and changes to free up trade unions would be curtailed.

The bill will return to the Commons in September for MPs to consider the amendments. The two houses then continue to vote on the changes in a process known as “ping-pong” until a way forward is agreed.

The amendments were put forward by the Lib Dem Lord Goddard, a former leader of Stockport council, and two Tory peers: Lord Hunt, who is a shadow business minister, and Lord Sharpe, a former investment banker.

Hunt did not respond to a request for comment. Sharpe said: “Keir Starmer’s unemployment bill is a disaster for employees as much as it is a threat to business. Labour politicians who have never worked in business are destroying the economy. Only the Conservatives are listening to business and making the case for growth.”

Goddard said he feared Labour’s “rushed bill” would be bad for workers in small businesses and on family-owned farms. “They were badly let down by the Conservatives, and Labour seems to have a blind spot when it comes to farms and small businesses, too.

“We support the bill as a whole and have worked constructively to try to improve it. It’s a shame to see the government getting upset that we didn’t simply give them a blank cheque.”

Employers groups welcomed the changes, saying the Lords was responding to business concerns. Helen Dickinson, the chief executive of the British Retail Consortium, said: “Putting forward positive, practical and pragmatic amendments to the employment rights bill [will] help to protect the availability of valuable, local, part-time and entry level jobs up and down the country.”

Industry chiefs have stepped up lobbying against the workers’ rights changes, warning that companies were already slashing jobs and putting up prices in response to tax rises in chancellor Rachel Reeves’s autumn budget.

Dickinson said there was “further to go” to curb the employment rights bill. “Even with these amendments accepted, retailers remain worried about the consequences for jobs from other areas of the bill.”

Union leaders have, though, urged ministers to stand firm. A recent mega poll of 21,000 people commissioned by the TUC found a majority of UK voters – including Conservative, Lib Dem and Reform UK supporters – backed a ban on zero-hours contracts.

Nowak said the government plan included “commonsense protections” that a majority of people wanted to see become law. “These peers are not just out of touch, they are actively defying their own voters – and the public at large. The government must stand firm in the face of cynical attacks and deliver the employment rights bill in full.”