Crossbench senators are being urged to block a push to scrap protections against so-called "double dipping" of casual worker entitlements.
Labor senator Doug Cameron will attempt to disallow a regulation which stops employers from having to pay out leave and other entitlements to workers getting a casual loading.
Australian Industry Group chief executive Innes Willox has written to crossbenchers telling them it was "obviously unfair" for workers to get a 25 per cent loading and leave payouts.
"It is critical that all senators reject Senator Cameron's disallowance motion," he wrote.
"The disallowance of the regulations would threaten the livelihoods of thousands of small business people and those who work for them."
Labor can scrap the move with the support of the Greens and four of the 12 other crossbench senators, with the motion due to come before the Senate on April 2.
Industrial Relations Minister Kelly O'Dwyer announced the regulation last year in response to a Federal Court judgment which ruled in favour of truck driver Paul Skene, who was employed by labour hire firm WorkPac.
The court found Mr Skene, who was a casual for two-and-a-half years, was not a casual under the Fair Work Act and therefore entitled to an annual leave payout.
Unions have argued the court decision closed a loophole which allowed employers to abuse the system by making people "permanent casuals" and dodge obligations.
The Australian Council of Trade Unions has said people with the same patterns of work as permanent employees should get access to sick leave, annual leave and other benefits.
Mr Willox warned the costs of paying loadings and entitlements to casuals would lead to businesses folding and entitlements paid out by taxpayers.
"This issue threatens thousands of jobs, including the jobs of young people who rely heavily on casual employment," he wrote.
