Cornwall Council is to begin a three-year pay freeze for staff with immediate effect, as it looks to save around £190 million over the next five years.
However, this action will still not rule out job cuts, which the chief executive has described as “inevitable.”
The decision is just one of a number agreed following a trade union ballot of Cornwall Council employees, over changes to pay and conditions of employment.
The agreement will also result in the preservation of national conditions of service and the implementation of the Living Wage (currently £7.65 per hour) with effect from April 1, 2015.
The council claims the changes will save more than £5.4 million.
Reduction in Government funding is forcing the savings. A reorganisation of the council’s management structure began earlier this year, with the previous six directorates now reduced to three, delivering initial savings of around £400,000.
Chief executive Andrew Kerr said: “The terms of the agreement were developed in negotiation with the unions.
“I am extremely appreciative of the constructive approach taken by the local and regional representatives of UNISON, GMB and Unite during the negotiations and of the positive response made by staff.
“The outcome of the ballot is very significant. It is the second time in three years that we have reached agreement on a pay freeze which will assist the council to make savings and preserve front line services.
“I am grateful to staff for the choice they have made in the ballot, especially as it is inevitable that, at the same time as making changes to pay and conditions, we will have to make job reductions.”
John Pollard, leader of Cornwall Council, said he was “delighted” that the council had been able to introduce the Living Wage for council staff from next April.
“This will improve the pay of our lowest paid staff, whilst at the same time making considerable savings towards the financial challenges facing us in local government. Our staff are committed and loyal to the delivery of public services and I appreciate this has been a difficult decision for them.
“I would like to offer my sincere thanks and recognition for their agreement to changes to their pay and terms and conditions,” he said.
Stuart Roden, UNISON regional organiser, agreed that it had been a “difficult decision” for members who he said had suffered “real and sustained cuts to pay and their standard of living” over the last three years.
“In addition they have had to absorb significantly increased workloads because of job losses whilst continuing to provide high quality services,” he said.
“We are pleased that we will be able to go some way to protect the lowest paid by implementing the living wage, which will in turn help the local economy.
“We hope that the savings made will also assist in protecting services and jobs which may otherwise have been cut. This ballot shows the commitment of our members to working for the best interests of Cornwall and is a mature decision taken in exceptionally difficult circumstances.”