Unison said a low pay "epidemic" was sweeping local government, leaving workers providing essential services at breaking point.
A survey of almost 15,000 workers in England and Wales, including catering staff, cleaners, refuse collectors and teaching assistants, showed that the value of their pay had fallen by an average of 16% because of a three-year wage freeze and rising prices.
Two thirds of the local government workforce now earns less than £21,000, well below the average wage, said Unison. A quarter of those polled said their pay had actually been cut, on top of the freeze ordered by the Government.
Unison said a payment of £250 for low earning workers promised by Chancellor George Osborne in 2010 and 2011 had not been paid.
Some councils have asked staff to take unpaid leave, others have cut enhanced pay for working weekends, redundancy pay was being cut, while unsocial hours payments were said to be disappearing.
"We know it's not easy but councils do have other choices; they should stop stuffing money into the pockets of expensive consultants, piling cash into reserves or wasting lots of public money on privatisation.
"A quarter of a million job losses in the sector mean those left behind are working harder than ever to keep local services running. After years of a pay drought, they deserve a decent pay rise this year."
The union is calling for a substantial wage increase for all local government workers and is currently in talks with council employers.