Marks and Spencer Group PLC (LON:MKS) instructed its contractor to cut the pay of cleaners at a distribution centre, according to a trade union report.
GMB members employed by GS Associates, who provide a cleaning service at an M&S distribution centre in Thorncliffe, South Yorkshire, were told they would have their hourly pay rates reduced, at the instruction of the FTSE 250-listed clothing and food retail chain.
Although the retail giant increased hourly pay for workers in February, it has now been reduced, apparently due to "human error in calculating the increase which cannot be sustained economically by GS Associates Ltd nor Marks & Spencer".
M&S has now threatened to fire and rehire workers who refuse to accept the pay cut from £11.41 to £10 per hour.
One worker told the union he was left with no choice but to leave his job, saying he "was already struggling to keep up with the cost of living and put food on the table for his family".
Lee Parkinson, GMB organiser, said: "This treatment of our members is disgraceful and callous. GA Associates and their client, Marks & Spencer, should hang their heads in shame."
He went on to add it is imperative M&S reinstate members' pay as soon as possible since most are struggling to make ends meet.
"They cannot afford to have their pay cut during the worst cost of living crisis in a generation."
In July, nearly a third of M&S shareholders voted against outgoing chief executive Steve Rowe's £1.6mln bonus, after advisory firms Glass Lewis and ISS criticised it as excessive.
Following Rowe's departure, M&S' board reshuffled to include Stuart Machin as chief executive on a salary of £896,000, Katie Bickerstaffe was appointed co-chief executive on £787,000, and Eoin Tonge was given an additional strategy brief and a salary of £739,000.
Upon reaching targets and achieving a 50% increase in shares by 2025, the trio could earn up to £15mln.
M&S has been contacted for a response to the report.