Vince Cable has been accused of lacking "any compassion at all" for Royal Mail staff who could be stripped of their shares if they are forced to leave the company.
The confrontation at the Commons Business Select committee came after Cable revealed that over 700,000 applications for Royal Mail shares had been received before for the midnight deadline on Tuesday.
Royal Mail staff gets free shares but are unable to sell them for an initial three year 'lock-in period', and will lose them if they leave the business.
Tory MP Brian Binley said the government had been "unfair" to Royal Mail staff "who had been immensely loyal" to the business, expressing concern that they could lose their shares in case they had to leave the business due to redundancy, ill health or forced relocation.
"Do you not have any compassion at all on this particular matter?" he asked Cable.
Cable initially suggested that people who had to leave Royal Mail due to redundancy, illness or relocation would be safe as "good leavers". However, Binley warned that the threat of losing shares could be used as a "disciplinary measure", which led Cable to admit that he needed to do "some more detailed work".
"I will certainly take up the issue on that probably small number of cases of people who might find themselves disadvantaged in that way," he said.
The LibDem business secretary confirmed that Royal Mail shares were oversubscribed seven times over, dismissing suggestions from City analysts that the business was undervalued as "froth" and "irresponsible".
Royal Mail's precise share allocations are set to be announced on Friday as it begins initial trading. David Buik, from City analysts Panmure Gordon, told the Huffington Post UK: "It looks like it's going to be an unqualified success. It has been underpriced but it hasn't been done wantonly."
