Iceland boss Richard Walker has warned Labour that a “shock” increase in minimum wage would bankrupt the frozen food specialist.

Walker told The Telegraph that the new government was “absolutely right” to overhaul working practices, but that any changes must happen slowly to avoid a “disastrous” impact.

Under the proposed workers’ rights overhaul, Labour plans to increase the minimum wage, end zero-hour contracts and give employees protection from unfair dismissal from day one. It is understood that the changes could be implemented by 12 October.

Walker urged the government to take a steady approach to introducing any reform rather than all at once.

He said: “If Labour puts up the minimum wage and brings in day one rights, that’s fine, but it needs to be bled in slowly. If they turn around and say ‘the minimum wage is £15 now’, that would bankrupt us.

“A huge leap in the national minimum wage would be disastrous. Of course, people should be paid as much as we possibly can. So let’s keep the ambition and keep pushing, but not have such a shock to business.”

The Iceland boss said he believed there was a place for zero-hours contracts, which have been branded “exploitative” by the new government.

While Walker said he did not like them for his own supermarket chain, he explained: “Some people want them, they might be studying or want the flexibility. I don’t think it is as simple as being exploitative.”

He is not the only retail boss to speak out on Labour’s workers’ rights overhaul, with Currys chief executive Alex Baldock warning the party risks “making people inadvertently poorer”.

“The more restrictions that you put in place, the less flexibility you allow in businesses’ relationships with their colleagues, the less likely businesses are to hire and the less likely they are to invest,” Baldock said.

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