More than 90% of requests for flexible working were approved last year
Plans to increase parents' rights to request flexible working are to be reconsidered, Downing Street says.
No 10 said Business Secretary Lord Mandelson was looking at "all regulations due to come into force", given the economic uncertainty.
But the spokesman said ministers wanted to help families, adding "no decisions have been taken on any of this".
The flexible working scheme was due to be extended to 4.5m parents of children up to the age of 16 from next April.
At the moment the right to ask for flexible working is limited to parents whose children are under six or disabled.
The extension was announced earlier this year following the recommendations of an independent review.
Leaders of small businesses criticised the step and said it could be damaging to firms.
But the then Business Secretary John Hutton said the move could help employers get the best out of the mothers and fathers in their workforce.
More than 90% of requests for flexible working were approved by employers last year.
Chief Secretary to the Treasury Yvette Cooper insisted earlier on Monday that the government would continue its support for flexible working.
She told GMTV: "What Peter Mandelson's been doing is looking at a whole range of ways in which we can support small businesses, help them through what are very difficult times as a result of what's going on in the global economy.
"What we clearly can't do, however, is do that in a way which makes life more difficult for people who are working for businesses, people who are worried about their jobs, and people who need flexible working, people who need additional support at work.
"So I think what we're looking at is ways of supporting small businesses and ways of introducing things flexibly.
"But what we're clearly going to do is carry on with the support for flexible working because I think there's a whole load of people right across the country who need that kind of flexible working."
TUC general secretary Brendan Barber said: "Postponing a simple right to request flexible working would not save a single job in the small business sector. If such a request harms the business, the owner can say no.
"This would be an astonishingly irrelevant response to the severe economic downturn that we face and, in addition, would run the risk of sending a message to working parents that the government is not on their side."
Employers' groups welcomed the review of extensions to flexible working and urged ministers to go further and scrap the proposals.
They also called for further increases in paternity leave and maternity pay to be dropped to help firms in the current economic climate.
"If the government is genuinely serious about helping small businesses during the tough times ahead it needs to take a hard look at all of its proposals in the employment field," Miles Templeman, the Institute of Directors' director general, said.
"We are convinced that many of these would impose significant new burdens on enterprises and we urge the government to abandon them."
Labour MP Patricia Hewitt, who introduced the current law on flexible working when she was trade and industry secretary, said: "When it comes to this business of more flexible working, and people reducing their working hours, actually that can be a real help in times of economic downturn.
"It makes much more sense for an employer to say to the employees 'would any of you like to reduce your working hours?' instead of thinking 'who am I going to make redundant?'"