The appointment of Lord Hendy as a transport minister is being questioned over claims about his conduct in a previous role as chairman of Network Rail.

Lord Hendy is accused of threatening to withhold public contracts from an engineering firm, Systra, after one of their senior engineers spoke to the press about safety concerns at Euston Station.

Shadow transport secretary Helen Whately said the situation raised “serious” questions for both Lord Hendy and the Labour Party.

Gareth Dennis, who was sacked by Systra following Lord Hendy’s complaint, had told the Independent in April that levels of overcrowding in Euston Station were sometimes “unsafe”.

Mr Dennis said his remarks were evidenced by a safety improvement notice that had been served by the rail regulator in October 2023. Network Rail says it resolved the issues raised by December 2023.

In May, Lord Hendy wrote a letter to the chief executive of Systra, Nick Salt, asking for evidence to substantiate the allegation, or alternatively, details of any action being taken against Mr Dennis for his remarks.

In the letter, first reported by the Politico news website and seen by the BBC, he reminded Mr Salt that “finding a potential supplier criticising a possible client reflects adversely on your likelihood of doing business with us or our supply chain”.

Mr Salt responded with an apology about any “alarm” caused by the press comments, while also stressing that Mr Dennis’ publicly expressed views do not reflect those of the company.

Lord Hendy, dissatisfied with the response, suggested that further action was needed, while offering to escalate his concerns to the firm’s shareholders and head office.

Mr Dennis was suspended by his employer several days later, which cited Lord Hendy’s complaint as the reason behind this.

He told the BBC that he was offered an employment reference and a lump sum in return for leaving the company voluntarily and signing a confidentiality agreement, which he declined.

Following a disciplinary process he was dismissed in July with four weeks’ notice for allegedly bringing both his employer and Network Rail into disrepute.

Mr Dennis, who won the Young Rail Professional Distinguished Service Award 2024, said he had been left with depression and anxiety as a result.

“It’s been an awful three months… an industry I care deeply about has chewed me up and spat me out,” he added.

Mr Dennis also argued that Lord Hendy should resign from the government because “someone who responds so vindictively… to safety concerns should not be in charge of shaping the rail industry”.

Writing on X, formerly Twitter, shadow transport secretary Helen Whately said: “The way to handle whistleblowers is to investigate their concerns.

“Threatening their employer and getting them sacked is the last thing a government minister should do.”

Ms Whately has written to the Cabinet Office Minister Pat McFadden to ask further questions about the vetting process for the minister and his suitability for public office, in light of the claims.

The Department for Transport did not provide a statement but advised that the minister would not be available for interview.

The Labour Party has been approached for comment.

A Network Rail spokesperson said: “The rail regulator’s concerns raised in September 2023 about passenger congestion at Euston station were addressed and put to bed in December 2023, months before the Independent piece was published.

“Decisions on how employee conduct is handled is a matter for employers – in this case, Systra.”

A spokesperson for Systra Ltd said: “We are unable to comment on individual staff matters other than to confirm that a thorough investigation was carried out.”