The Morrison government's proposed changes to the bargaining system will be introduced to parliament on Wednesday as part of wider industrial relations reform.
Under the bill, the Fair Work Commission would be given more scope to approve agreements that fail the better off overall test.
The commission would take into account coronavirus impacts and support for the deal from all parties at the bargaining table.
Australian Council of Trade Unions secretary Sally McManus said employers would rush to cut wages in a similar vein to the Howard-era WorkChoices laws.
"These changes are dangerous and extreme. WorkChoices allowed employers to cut wages, and this proposal will do that as well," she said on Wednesday.
Industrial Relations Minister Christian Porter said union claims that one in four workers could cop a pay cut were absurd.
"Everyone's worse off if a business fails and hundreds of jobs go," he told the ABC.
"Everything in this suite of reforms is designed to keep businesses growing, to grow new jobs, to give people extra hours, to create paths from casual to permanent employment."
Employer groups back the plan, with Australian Chamber of Commerce and Industry chief executive James Pearson calling it an important first step.
"This is critical to keeping businesses trading rather than insolvent and keep people in work and off the unemployment queues," he said.
Australian Industry Group chief executive Innes Willox said the commission should have extra discretion to approve agreements that didn't meet the better off overall test during the pandemic.
The federal government held five industrial relations working groups with unions and employers looking at enterprise bargaining and four other areas included in the bill.
But the ACTU claims it has been blindsided by bargaining changes, which Ms McManus says were not discussed.
"Working people, essential workers, have already sacrificed so much during this pandemic. These proposed laws will punish them," she said.
Federal Labor is shaping up for an almighty fight on industrial relations over the "emergency" changes to bargaining, slated to last two years after the bill passes.
The bill also aims to slash the time the commission has to approve enterprise agreements to 21 days.
The better off overall test will be reformed to prevent hypothetical working arrangements from being considered.
Enterprise bargaining was introduced in the 1990s to lock in productivity gain and higher wage rises but has been in decline in recent years.