Convicted offenders who are unemployed should be given longer community sentences, according to the chairman of the influential home affairs committee.
John Denham claimed offenders who had a job or cared for family members should receive shorter sentences.
This would be fairer because "the impact is clearly much heavier on someone who is already busy than someone who isn't", he said.
The Home Secretary has said he needs solutions to overcrowding in jails.
Mr Denham, a former Home Office minister, claimed his suggestion would build confidence in community sentences - an important part of reducing overcrowding in prisons.
"If someone has more time on their hands, perhaps if they are unemployed, but not necessarily, the length of their sentence should be longer," he told the BBC.
He said punishments should have a "broadly equal impact on people".
"Giving different offenders the same length of community sentence is superficially equal, but in reality, it isn't."
As an example, he said a worker would find a community sentence of 100 hours "really tough [because] that's going to take a lot of your free time over the next few months".
An unemployed person would not find 100 hours so disruptive, however, he added.
And the principle of giving offenders different sentences was already accepted as higher earners could already be subject to bigger fines than lower earners, he claimed.
Mr Denham also suggested that offenders should wear uniforms while carrying out their community sentences, and that there should be greater use of attendance centres so that public saw "offenders are being deprived of some of their liberty".
The Liberal Democrats' home affairs spokesperson Nick Clegg said the ideas "deserve further scrutiny".
But any changes to non-custodial sentences "must be set against the acid tests of whether they increase public confidence, and whether they reduce reoffending", he claimed.
"It is only a shame it is ex-ministers, rather than current ministers, who are doing the creative thinking on these issues."
Human rights organisation Liberty said any plans to base sentences on employment should be rejected.
"Not only would this reduce the time people spend looking for work, but send a signal that punishment is determined by the size of your bank balance - not the gravity of your crime".
The Home Office has begun housing offenders in police cells to relieve the overcrowding in prisons in England and Wales.
It has also advertised for contractors to provide up to 800 places on ships.