Former council staff transferred to a private education company face salary cuts of thousands of pounds.
Employees with up to 20 years' experience at Waltham Forest council had to apply for their own jobs and suffered pay cuts of up to pound;4,000. Fifty jobs - transferred to EduAction after the company's takeover of the council's education service in September 2001 - will be affected by the changes.
One employee said: "People feel angry and humiliated. We have been made to reapply for our jobs and been treated worse than external candidates would be."
Steve Woodhouse, Unison local official, said that EduAction had broken promises at the time the consortium took over that pay and conditions would be unaffected.
A spokesman for EduAction, a partnership between Nord Anglia and Amey, denied cost-cutting. "Changes have to be made to improve services," he said.