The union representing federal public servants has accused the government of moving to cut wages and conditions, saying it had been told of plans to introduce a cap on pay increases.
The Community and Public Sector Union (CPSU) says the government will use the next round of enterprise bargaining to limit wage rises to between zero and 2.5 per cent.
It would also link any pay rises to trade-offs in conditions and allowances.
CPSU National Secretary Nadine Flood says while the government has yet to release its wages policy, public sector sources have told the union about the plan to target pay and conditions.
"It appears it has all but drafted the fine print on a highly-aggressive policy to cut real wages, conditions and rights," Ms Flood said in a statement.
The cap on wages comes on top of a government target to cut 12,000 jobs through natural attrition.
Public sectors workers were facing a "double whammy", Ms Flood said.
"Firstly thousands of jobs are being cut and the remaining staff are being flogged harder to get the work done," she said in a statement.
"Secondly, no-one is going to get a pay rise that keeps up with inflation, unless they agree to have their rights and conditions cut."
A spokesman for Employment Minister Eric Abetz declined to comment on the speculation, but said the enterprise bargaining guidelines had not been released.
