Ed Miliband will pledge to close down job agencies that exploit workers and break the law on the minimum wage.

This will include closing the Swedish Derogation – a loophole in EU law that allows employers to pay agency workers less than permanent employees, even if they are doing the same job.

Miliband will also reiterate that a next Labour government would stop agencies from recruiting workers only from abroad.

As it stands, roughly 350,000 people receive less than the minimum wage.

This is the latest of Miliband’s plans that outline what Labour’s intervention into the ‘zero-zero economy’ would look like. Miliband will explain:

“The Government will tell you the economy is fixed, but the British people know it is not delivering for them. I believe the basic bargain of our country is that hard work should be rewarded. But too many people face insecurity, exploitation and unfairness at work. It will be the mission of the next ­government to change this.”

“We will not tolerate a zero-zero economy where hundreds of thousands are kept on zero hour contracts while a tiny privileged minority pay zero tax.

“And nor will we tolerate a world of work that is becoming more brutal because of the way some cowboy employment agencies have been allowed to operate. They are undermining dignity at work, driving down standards and creating greater insecurity for families.

“We will begin consultations now, even before the next election, on the different ways this can happen such as through a licensing system so we can be sure that agencies are complying with basic standards.”