THE council has issued a formal notice of its intention to "terminate the employment" of 4,500 staff.
But all will be offered new contracts reflecting changes made to their redundancy terms and conditions.
Earlier this week, councillors agreed to halve redundancy pay from a maximum of 104 weeks to 52 weeks, with a 500-a-week cap on the amount anyone can receive.
It means an end to six-figure payouts and the introduction of a maximum sum of 26,000.
In a note to workers, council leader Janet Battye said by changing the scheme, the council was keen to ensure that lower paid workers received the best possible package under the current financial constraints.
"Making staff redundant will be the last option but those on a salary of 26,000 a year or less could still receive up to 73 per cent more than colleagues employed at other West Yorkshire councils," she said.
Trades unions say it is disgraceful that Calderdale Council should make changes to the redundancy scheme without knowing the full financial implications which will not become clear until the 2011/12 budget is confirmed at the end of February.
"We are bitterly disappointed that potential redundancy payments for 4,500 employees are to be drastically reduced," said joint union spokeswoman Sue McMahon.
"A low paid worker will see their redundancy payment halved."
She said that Calderdale Council workers were paid less than neighbouring authorities and to cut redundancy payments was callous and heartless.
Gary Barker of the GMB union said some of those facing redundancy might never work again.
Councillor Conrad Winterburn (Lib-Dem, Greet-Stain) said: "We are in an unprecedented position – the Government says the council must spend less and the existing redundancy scheme is unaffordable."
* Trades unions will hold a rally against council spending cuts at the Piece Hall, Halifax, on Saturday, February 12, at 11am.
*Do you think the council has been fair in the way it has changed its redundancy terms? Email firstname.lastname@example.org