MPs will call for a second employment rights Bill to be introduced this autumn if the current legislation is not amended to include union demands for sectoral bargaining and creation of a single “worker” status, former shadow chancellor John McDonnell said today.

The chair of the Public and Commercial Services (PCS) union’s parliamentary group of MPs told its annual conference that the current government legislation “doesn’t go far enough.”

He said: “So what we’ll be doing as a trade union on your behalf: we’ll be seeking to amend that legislation over the course this consultation.

“If this legislation doesn’t contain those demands, we’ll be calling for a second employment rights Bill to be brought forward this autumn that really brings forward the trade union rights that we’ve been campaigning for over the years.”

He said it was interesting that former Labour chancellor Gordon Brown had joined the growing momentum putting pressure on the government to scrap the two-child benefit cap.

Mr McDonell, who remains suspended from Labour for voting last year to abolish the two-child benefit cap, added: “I don’t want it amended to three children or four children — I want it gone altogether.”

The winter fuel allowance should also be returned to a universal benefit taxed from richer pensioners, he said.

Labour’s decision to means test it “was a decision taken in haste and a huge mistake that has impacted on many poorer pensioners,” said the MP for Hayes and Harlington, adding the worst of the government’s austerity drive is its proposed disability cuts.

He warned that introducing stricter eligibility for personal independence payments risked suicides, adding: “If the [Treasury’s self-imposed] fiscal rules are causing that level of human suffering they should be scrapped as well.”

Turning to the local elections, he said: “What Reform has done is exploit those mistakes and like every proto-fascist party in history — because that is what they are — they blame what’s going wrong in our society on any group they can target, and this time it’s asylum-seekers.”

Mr McDonnell hit out at Labour’s anti-migration rhetoric, adding: “I found it disgraceful that a Labour Prime Minister was using the words of Enoch Powell.”