Last-minute negotiations were being held last night in a bid to head off a row over new employment rights for temporary and agency workers.
The Government has been opposed to a new directive, arguing it would damage the country's flexible labour market and hit jobs.
Ministers have also been trying to maintain the UK's opt out from the European Working Time Directive, which aims to limit the working week to 48 hours.
Business groups have urged the Government to stand firm on both issues despite growing calls from trade unions to accept an Agency Workers Directive to stop temporary staff receiving less pay, holidays, training and pensions than full-time employees.
Britain and Germany are among the countries opposed to a directive, but they could be outvoted when employment ministers meet in Brussels today.
Sources in Brussels said the Government was offering deals to other countries if they supported its stance against an agency workers directive. "It's on a knife edge," said the source.
Philip Bushill-Matthews, Conservative MEP for West Midlands and the party's employment spokesman in the European Parliament, said the Government was being pressed to accept a directive which would cut the number of temporary jobs in the UK and add millions of pounds in costs to business.
John Wright, chairman of the Federation of Small Businesses, said: "Agency workers not only provide flexibility for businesses, but also offer choice to the EU's diverse labour force. We call on the Government to stand firm on this issue, which is crucial not only for SMEs but also for job-seekers."
The British Chambers of Commerce said a directive would disproportionately affect the UK because of the high number of agency staff employed in this country.
Helen Reynolds, acting chief executive of the Recruitment and Employment Confederation added: "It is vital that any agreement does not result in less temping jobs in Britain. The recruitment industry places 1.3 million people into temporary work across the UK every week, allowing employers to bring in extra resource at short notice.
"Our independent polling shows that over 80 per cent of temps are satisfied with their assignment. There simply isn't the abuse on the ground to support the need for this directive. It is not in the interests of recruitment agencies to treat agency workers badly, as without them they would not have a business.
"REC supports good terms and conditions for agency workers but the current provisions in the directive on agency work would only add bureaucracy and uncertainty to the recruitment of temps, thus limiting job opportunities."
The TUC published fresh claims of abuse against temporary staff, including migrant workers, in a bid to persuade the Government to agree a deal.
The report presented evidence of "widespread mistreatment" of migrant workers including staff charged for receiving their pay by cheque and others paid £1 an hour less than permanent workers doing exactly the same job.
Billy Hayes, general secretary of the Communication Workers Union, said: "We have been working towards this moment for over five years and it is now crunch time for the Government.
"The UK is behind the times on this issue because many member states already enjoy equal treatment of agency workers.
"The Government needs to consult its conscience - this is a moral issue and it is time that this injustice ends."
Meanwhile, a backbench Labour MP is to take forward a Private Members Bill in the House of Commons aimed at sorting the issue.
Andrew Miller, MP for Ellesmere Port and Neston, will introduce a Bill giving new rights to 1.4 million agency workers.
Mr Miller was third in this year's private members ballot meaning that he will have parliamentary time for a full debate of his proposals.
Mr Miller said he wanted the Government to work with him so that the proposals became law.
"We cannot turn away from what is a mounting concern for our communities - the legalised discrimination of a significant number of workers in this country."
Supporters of the Bill hope it will have a second reading next February.
Tony Woodley, joint general secretary of Unite said he was delighted at Mr Miller's move adding: "The Government must listen to him."