Firms do this by going into administration and then resuming business under a similar trading name.
Speaking in Scarborough at the conference of the construction workers' union, Shadow Business Secretary Chuka Ummuna said it was wrong that the present Government was prepared to stand by while rogue businesses exploited loopholes in the law to evade justice when their malpractice led to deaths at work.
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"So I give this commitment today: the next Labour Government will legislate to prevent this abuse. It puts the lives of workers at risk," declared Ummuna. "It is irresponsible. It is wrong. We will stop it."
The announcement was welcomed by UCATT, which is waging a campaign to stamp out the scam that allows so-called phoenix firms to escape punishment when one of their employees is killed at work.
The union wants the Health and Safety Executive to be able to freeze a company's assets as soon as a worker is killed and until investigations into the death are concluded. Similar powers exist in cases involving fraud and drug crimes.
UCATT General Secretary Steve Murphy said the law had to be changed in order to ensure safe working practices in construction, an industry in which nearly 50 workers were killed last year.
He added: "Bereaved families also deserve justice. It is bad enough for them to lose a loved one, but for the law to allow those responsible to escape justice is a grievous insult."
(CD/GK)
