Iain Duncan Smith has been warned by social security advisers that part of his flagship welfare reform is "unworkable and unfair".
The Social Security Advisory Committee has strongly criticised plans to require part-time staff to try to obtain more work or lose their benefits, saying that it is "unrealistic in the current economic climate".
The committee, which acts as an official advisory body to the Work and Pensions Secretary, set out its views in a written response to the Universal Credit White Paper, Mr Duncan Smith's blueprint for simplifying the benefits system and making work pay.
"With high under-employment - currently over one million part-time workers in the UK want to work more hours - sanctioning clients who cannot increase their hours seems to be both unworkable and unfair," it said.
Under the plans, part-time workers could lose money for not applying frequently enough for jobs, not attending interviews for a better paid job within 48 hours of being directed by a jobcentre, or not taking up a full-time job within 90 minutes from home.
In its submission, quoted by The Observer, the committee said: "We cannot see how in-work sanctions can be policed and are concerned that customers working short hours may be penalised as a result of labour market conditions, rather than as a result of their response to the conditionality regime applicable to them."
Figures last week showed that part-time workers rose to 8.12 million, the highest level since records began in 1992. Some 1.42 million of those would prefer to work full-time.
A spokeswoman for the Department for Work and Pensions said: "The Social Security Advisory Committee's report is on the White Paper which set out the vision for welfare reform nearly two years ago.
"We have now moved on and are have asked SSAC to consult on the more detailed regulations which outline how Universal Credit will work in practice so that we can transform Britain's welfare system to make sure work always pays.
"SACC will publish its latest report on Universal Credit later in the autumn."