Birmingham City Council has agreed to pay out more than £700 million in compensation to some of its female workers who were paid less than men for doing the same job.
The illegal practice was going on for years until the women took their employers to a tribunal. The council doesn't have the money to pay the claims so it's going to take out a huge loan which will take twenty years to pay off.
The council has warned that any services it does not have to provide by law might be cut.
Sir Albert Bore, Leader of Birmingham City Council, has said there is no other way than to look at decommissioning services in order to look for money to pay for the equal pay claims the council received today.
In addition, the council needs to save £600 million a year for the next five years.
Birmingham City Council today said it's received equal pay claims totalling £757 million from women who were paid less than men for doing the same job.
It also revealed that it will be receiving more claims following a court ruling which will allow women who believed they were discriminated against to lodge claims until 2018.
The council doesn't have the money to pay the £757 million in claims and needs to borrow it.
The interest payments will amount to £75 million a year by 2015/16.
Sir Albert Bore, the leader of the city council said they're considering cutting services it doesn't have to provide by law.
The council has to pay these claims - in addition to saving £600 million a year for the next five years.
The Supreme Court has told Birmingham City Council it must abide by a previous High Court ruling that it underpaid former female employees, which could pave the way for huge compensation claims.
It's a landmark ruling that could see millions handed out in claims by Birmingham and other councils.
Former Birmingham City Council employees speak out following the decision by the Supreme Court to allow 174 women to continue with their claims for equal pay compensation.
Chris Benson one of the lawyers acting for the 170 women who brought the original case against Birmingham City Council say the council told the former employees repeatedly they were "out of time".
The lawyers acting for the 170 women who brought the original case against Birmingham City Council say this marks "an historic decision".
For more on this story see the ITV National News website.
Following the Supreme Court ruling that has given the go-ahead to former employees to launch unequal pay claims, Birmingham City Council says it is considering its options.
Lawyers say the landmark case could have "huge implications".
They were cleaners, cooks and carers for the council. They were on the same basic wage as male workers such as refuse collectors and grave diggers, but bonuses the women did not receive saw the men earn on average 10,000 - 13,000 more than the women.
However, scores of women who had left the council fell foul of a rule that say employees must launch tribunals within six months of their leaving a job.
They took their case to the High Court, which found in their favour in 2010 but the council appealed against that ruling.
Today the Supreme Court ruled the council has a case to answer in the High Court.
Lawyers for the group say the claim will cost Birmingham City Council £2 million - and they have another 1000 cases of former council workers who say they were also underpaid.