The Labour party has cut all ties with the Confederation of British Industry after the Guardian’s revelations about alleged sexual misconduct by male employees at the lobbying group. The CBI experienced an exodus of major member businesses at the end of last week, including the insurer Aviva, the retailer John Lewis, the manufacturer Jaguar Land Rover and the banking firm Natwest Group. Companies said the lobby group was unable to carry out its role effectively following the allegations, after a second woman alleged to the Guardian that she was raped by two male colleagues when she worked at the CBI. Jonathan Ashworth, the shadow work and pensions secretary, told the BBC’s Sunday with Laura Kuenssberg programme that the lobby group needed “a root and branch review and reform process”. Asked if the party would cut its links with the CBI, Ashworth said: “Well, we have done”, adding that the party had ceased all contact. Ashworth said: “I just feel for the people who have been victims, and that the CBI has really got to get its house in order.” The government had already paused its regular engagement with the group. The prime minister, Rishi Sunak, will on Monday meet 200 business leaders as he looks ahead to a general election likely to take place next year. The CBI had initially been invited, but had its invitation rescinded, the Sunday Times reported. The CBI on Friday said it had suspended all policy and membership activity until an extraordinary general meeting in June to allow members to “decide on the future role and purpose of the organisation” after the allegations. The CBI is understood to be holding an all-staff meeting on Monday to update employees on its plans. Some CBI staff are understood to be concerned about potential redundancies at the group, and surprised there’s been no discussion yet around job security. The group faces a crucial week ahead. Early in the week it is expected to respond to a report by Fox Williams, an external law firm commissioned to carry out an independent investigation into the allegations. Rain Newton-Smith, the CBI’s former chief economist, is also this week expected to take over as director general, after being appointed this month. The Guardian this month reported a series of allegations from female employees of sexual misconduct by male employees of the organisation, including one woman who said she was raped at a party in 2019. The Guardian on Friday reported a second allegation of rape of a woman by two male colleagues. The allegation was passed to police by the CBI. The CBI’s board on Friday said it had received “a demand for far-reaching change” from its members but the crisis has led to some business leaders questioning whether the organisation can carry on in its current form. One London lobbying firm, WPI Strategy, has established a group called BizUK to lobby for business “while the CBI activities are mothballed”. Nick Faith, WPI’s founder and a former communications director of the Conservative-linked Policy Exchange thinktank, said it was a “temporary, time-limited initiative” in the run-up to the next general election. The City of London Corporation, which lobbies on behalf of the capital’s financial services industry as well as acting as a local authority, on Sunday said it was deciding on Monday whether it would retain its membership. However, Chris Hayward, the Corporation’s policy chairman, said he believed the CBI was still “needed” by British businesses. “It’s a very, very serious situation but at the same time, I’m keen to see the CBI recover,” Hayward said in an interview on Times Radio. “I think it has a key role in speaking up for businesses as well. And so we’ll keep it under review. And we’ll make a decision.” Questioned as to whether it should be wound down and replaced by a new organisation, Labour’s Ashworth said: “This is all for the CBI to decide how they’re going to reform themselves. There’s clearly deep-rooted problems there. And they need a root and branch review and reform process.” The CBI declined to respond to Ashworth’s criticisms, instead pointing to a statement from its board on Friday. The statement said: “We are deeply sorry and express our profound regret to the women who have endured these horrific experiences.” No 10 Downing Street was approached for comment.