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As part of proposals announced by Trade and Industry Secretary Patricia Hewitt, pay for new mothers would increase by £1,400.
The plans, which have been branded by the Tories as a desperate bid to appeal to female voters, would see maternity leave rise to nine months by 2007, with the long term aim of increasing it to 12 months by the end of the next parliament.
Labour have already increased maternity leave to 26 weeks since they were elected and although the plans would not require employers to pay for the extended allowance, business groups argue that bosses will still be landed with extra financial burdens.
A new survey by the British Chambers of Commerce (BCC) reveals that 80 per cent of bosses rejected the proposals.
Opposition grew stronger as the size of the business decreased, with 84 per cent of firms with less than 50 employees voting against increased maternity leave.
David Frost, BCC director general, said: “Business has sent a powerful message to government that they cannot support increased flexible working rights.
“Businesses already have a raft of regulations to deal with and these types of policies will have a direct and damaging impact on the way a boss runs his or her company.
“In addition it is becoming increasingly difficult for businesses to plan around parental leave when staff only have to give minimum notice if they are going to come back.
The survey also shows that bosses are becoming over burdened with extensions to flexible working rights in general. Figures reveal that 62 per cent of businesses opposed further changes in legislation, with the loudest appeals once again coming from smaller firms.
Frost said, “We have seen a mass of flexible working regulations in recent years, our survey shows that businesses cannot take any more.”
