It follows a European court ruling that the sacking of Arthur Redfearn, a British National Party (BNP) member, from his job as a bus driver over his political views breached his human rights.
Ministers will exempt those claiming they were dismissed because of their political beliefs from the rules which means workers in the UK have to be in a job for two years to be able to claim.
The decision by the European Court of Human Rights followed a long legal battle by Arthur Redfearn, who was sacked from his job in 2004 in Bradford, West Yorkshire, driving children and adults with special needs.
Mr Redfearn was dismissed from his job by the private firm Serco due to his membership of the BNP. In 2004. Serco successfully argued, in a British tribunal, that Mr Redfern jeopardised the ‘Health & Safety’ of users because his views might offend others and attract violent opposition. Evidence suggested that Mr Redfearn kept his work and political views separate.
The ECHR clearly thought that such an argument was risible (see full judgement here).
The court judgment criticised the fact that Mr Redfearn could not bring a case of unfair dismissal against transport operator Serco - and was forced to claim race discrimination instead - because UK law said he had not worked long enough for the firm.
Business minister Viscount Younger of Leckie said the government would introduce an amendment to the Enterprise and Regulatory Reform Bill, currently being considered by the Lords, to reflect the ruling.
"This amendment exempts claimants who allege that their dismissal was on the grounds of political opinion or affiliation from this two-year qualifying period," he told Parliament in a written ministerial statement.
The change will come into effect two months after the bill receives Royal Assent.
Patrick Harrington, General Secretary of Solidarity, commented:
"I welcome this great judment form the ECHR. They are a body that was established as part of a Treaty we signed as a Nation and are not to be confused with the European Union as gutter rags like the Sun and reactionary UKIP types would like to happen. It was a great day for freedom in our country when the ECHR judges spoke. It also makes me very happy that the ConDem government have been forced to back down on this issue and change an unjust law. Now everyone is protected from political discrimination in the workplace, just as I and others have said they should be for years. Our Union stands against all forms of discrimination in the workplace."