Scottish Trades Union Congress (STUC) general secretary Grahame Smith said the party should support Nicola Sturgeon’s plans for another vote on whether Scotland should leave the UK.
The First Minister has said she wants to hold such a ballot in the latter part of 2020.
Mr Smith said the democratic wishes of voters in Scotland must be respected following last month’s general election result, in which the SNP gained 13 seats to take 48 out of Scotland’s 59.
His comments, in the forthcoming issue of the Scottish Left Review, are reported in The Herald.
He said: “The First Minister has made it clear she will now push for indyref2.
“This has left Labour in a quandary: it cannot hold, as it has, that the overall election result gives the Tories a Brexit mandate, and simultaneously maintain the result in Scotland cannot be viewed as a mandate for indyref2.
“The democratic wishes of the people of Scotland need to be acknowledged. The Scottish Labour movement should support indyref2.”
He did not endorse Scottish independence, but said Scottish Labour has “nothing to fear and much to gain” from considering what leaving the UK could look like.
In his new year message, Scottish Labour leader Richard Leonard said he believes “a separate Scotland would leave us worse off, and not just materially”.
SNP depute leader Keith Brown said: “This is a significant and welcome intervention from Grahame Smith.
“He is entirely right to say that the democratic wishes of the people of Scotland should be respected. Scotland’s future should be in Scotland’s hands - not those of Boris Johnson.
“No politician or political party should stand in the way of people having that right to choose.
“The Scottish Labour movement should take seriously the advice of Scotland’s top trade unionist and engage positively over how we build a fairer, more prosperous country with the powers of independence.”