Bosses who do not already consult with their workers believe new proposals for employees will wreck their companies, a new survey has suggested.

Research by the Work Foundation found that employers are against possible legislation that would make consulting workers a requirement in companies with over 50 employees.

Bosses who do not already consult staff feared the move would hit share prices and their competitive position in addition to allowing staff to halt mergers by leaking commercially-sensitive information.

The problem was less of an issue for companies that already have consultation procedures in place.

Employers also worry that legislation will slow decision-making or open the door to demands for negotiation with workforce representatives on business strategy.

The researchers also found employers are unfairly stigmatising union and other employee representatives.

The DTI is currently drawing up draft legislation and is expected to begin consultation on it next month.

The foundation called on the department to ensure any legislation allowed employers to take action where confidentiality is breached.

Ministers were also urged to run pilot schemes to test out how the laws would work in practice before putting them on the statute book.

"This study suggests new information and consultation rights will be much less disruptive to business than critics forecast," said Patrick Burns, director of advocacy at the Work Foundation.

"Many companies already do what the likely legislation will require. The DTI now needs to do a lot of practical piloting to help and guide the employers and workforce reps for whom consultation will be a new experience."