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Up to 2,000 workers at Wolverhampton City Council face losing their jobs because of budget cuts.
The council currently employs almost 6,000 people - meaning a third of its workforce is under threat. The money it gets from government has been halved from £284 million to £137 million a year.
To help raise money, council tax will go up by almost 2%.
Staff were told of the changes at a series of meetings today. They have also been told they will get less sick pay and there will be a freeze on pay rises. Drivers caught on camera using bus lanes will also be fined.
Councillor Roger Lawrence said the reduction in funding to local councils will 'damage' Wolverhampton.
The union for public sector workers GMB has spoken out about proposed cuts of up to 2,000 jobs at Wolverhampton City Council, calling it a "devastating blow" to workers.
The council has announced up to 2,000 jobs could go because they need to save £120m over the next five years.
The Labour-controlled council said it was battling the most "challenging" financial circumstances in its history because of "massively reduced" grant funding from the Government.