Benefit payments to top up the wages of low-paid workers will be stopped if they go on strike, the Government has announced.

Employees eligible for working tax credits because they earn under £13,000 will no longer receive extra cash if their salary nose-dives because they take industrial action.

Bosses will be given a code to alert the authorities if any drop in wages has been caused as a result of a walkout when all welfare payments are brought under the new Universal Credit system next year.

Work and Pensions Secretary Iain Duncan Smith said the current rules were out of date and unfair.

"It is totally wrong that the current benefit system compensates workers and tops up their income when they go on strike," he said. "This is unfair to taxpayers and creates perverse incentives.

"Striking is a choice, and in future benefit claimants will have to pay the price for that choice, as under Universal Credit, we no longer will."

The Department for Work and Pensions said nearly 1.4 million days were lost to strike action last year.

A Unite spokesman said: "This is gesture politics aimed at putting fear into vulnerable, low-paid workers to stop them from standing up for their rights against poor working conditions."

TUC general secretary Brendan Barber said: "This is petty and vindictive. Workers are always reluctant to strike, depriving their families of benefits will leave low-paid workers even more vulnerable to bad treatment."