The Equality and Human Rights Commission (EHRC) has indicated that its proposed guidance on access to single-sex services for trans people may be revised to reduce the legal and financial burden on UK businesses.

The move follows sustained concern from employers, campaigners and MPs over the impact of earlier proposals that would have significantly restricted trans people’s access to facilities such as toilets and changing rooms.

Sources spoke to The Guardian, revealing that following the appointment of the new EHRC chair, Dr Mary-Ann Stephenson, lawyers for both the EHRC and the government are discussing changes to the finalised draft.

A draft code of practice, submitted to the Equalities Department in September, was developed in response to a Supreme Court ruling clarifying the definition of a woman under the Equality Act 2010.

The unpublished document, produced under former EHRC chair Baroness Kishwer Falkner, was widely criticised for suggesting that trans people could be excluded from facilities aligning with their gender identity and, in certain circumstances, even from those associated with their sex assigned at birth.

Under current legislation, ministers cannot amend the code directly. Instead, they must formally reject it and request revisions. The original guidance prompted a strong reaction from the private sector. More than 650 organisations, including major brands and small enterprises, warned last year that a ban on trans people using single-sex spaces would place them at constant legal risk.

A government spokesperson said MPs were reviewing the code “with the care it deserves”, emphasising the need for clarity for service providers. However, trans rights groups have warned that watering down restrictions without explicitly affirming inclusion risks leaving trans people vulnerable.

Alex Parmar-Yee, director of Trans+ Solidarity Alliance, said any revised EHRC trans guidance code must clearly explain how trans people can be safely and lawfully included. “Trans people are already being excluded from everyday spaces and put at risk simply for existing,” they said, adding that a trans toilet ban, in any form, could define Labour’s record on LGBTQ+ rights for a generation.