An email sent to IT contractors by Lloyds Banking Group this month has revealed that their pay is being cut by 15%.
The bank has told contractors to accept the offer or leave.
The email, which has been leaked to Computer Weekly, was sent on 19 June and contractors were given until 20 July to accept the changes to pay.
One recipient of the letter said, "all attempts to negotiate around the imposition of the cut were met with: 'take it or leave the bank on notice'."
By submitting your email address, you agree to receive emails regarding relevant topic offers from TechTarget and its partners. You can withdraw your consent at any time. Contact TechTarget at 275 Grove Street, Newton, MA.
Lloyds told Computer Weekly that it is bringing the rates in line with the overall market.
In the email to contractors the bank blamed the "unprecedented volatility and extreme market conditions" in the UK economy for the cuts. "This adjustment is not a reflection of the perceived quality or value of your contributions to date, but is a response to current market events and Lloyds' focus on cost management," it said.
Matthew Smith, director of UK regions at recruitment company Harvey Nash, said banks have generally paid contractors well so a 15% reduction could still be better than other sectors. "This depends on the starting point but it could be the case that a 15% reduction brings them in line with contractors in other sectors."
Lloyds is also making IT staff redundant. It was recently accused by union Unite of embarking on a strategy of "death by a thousand cuts."
The bank has taken on billions of pounds in loans from the government and has setitself tough cost-cutting targets.