A council has drafted a secret plan to sack 821 workers if they refuse to take pay cuts of up to £8,000 each.

A confidential document seen by The Argus sets out Brighton and Hove City Council's latest move in its attempts to stave off compensation pay-offs which cost it more than £23 million this year.

It sets out proposals to terminate the contracts of 821 workers who are mostly employed either as binmen and street cleaners in its CityClean waste department or in the city's parks service.

Their jobs would be lost on January 1, 2010, unless they accept new lower wage deals.

The document proposed the plan as a contingency if negotiations with trade unions over the pay cuts fail.

Senior council officers are due to meet with union leaders on July 28.

Mark Turner, Brighton and Hove branch secretary for the GMB union, said: "If they are going to use language like this, that they are going to terminate contracts, it doesn't fill me with confidence going into negotiations.

"It sounds as if they are only planning to pay lip service to us and will go ahead and do what they want anyway."

The council has been trying to deal with a historical inequality in its pay structure which has left it vulnerable to legal action.

Almost three thousand unskilled workers based at schools, libraries and other departments accepted cheques of up to £20,000 each in March.

The windfall was used to compensate them for being underpaid by comparison to others, mostly binmen, who have similar skills but have been paid significantly more by the council for a number of years.

They also signed away the right to make legal claims until January 1, 2010.

The Argus revealed last month that to avoid making more payouts in future, the council was preparing to ask the higher paid workers to take pay cuts of between £2,000 and £8,000 a year each.

The GMB spoke of their fears they would not be able to stop CityClean staff staging week-long wildcat strikes this summer if the move went ahead and added a ballot for formal industrial action was likely.

Mr Turner said: "We will go into meetings with an open mind, we are ruling nothing in and nothing out but the council must realise they are dealing with people's livelihoods here."

He said more than 200 teaching assistants at the city's 16 faith schools, who were left out of the compensation payouts on a technicality, were also poised to strike but were not now likely to do so until the new academic year in September.

The latest move has been criticised by opposition councillors.

Liberal Democrat group leader Paul Elgood said he was glad the pay problems were being tackled by the council but described the latest moves as "extremely controversial".

He said: "It is a big ask for many members of staff to reduce their salaries and it will be particularly hard to take in a time of recession."

Labour group leader Gill Mitchell said: "It is an incredibly poor way to treat people. This approach doesn't demonstrate any commitment to working particularly hard to achieve the best possible outcome for the staff."

The council yesterday said it could not discuss confidential information but did not repudiate the leaked facts.

A Brighton and Hove City Council spokesman said: “The council has a legal and moral duty to pay each of its staff fairly. We are entering into talks with the unions to try to implement equal pay by negotiation and we are hopeful that this will be successful.”