More than 300 staff who work for Medway council have been denied a full pay rise, Labour has claimed.

According to the party, some 369 employees only received the “cost of living” element of their 1% pay hike because they had already reached the top of their pay scale.

Unison said that long-serving staff were being penalised for their loyalty.

The claim has sparked a row, with the Conservative leader of Medway council Alan Jarrett accusing Labour of political opportunism.

The issue of whether to relax the cap on public sector pay gap has dominated the political agenda, with some cabinet ministers hinting that the cap should be relaxed.

A separate analysis of government data that showed the mean earnings of people in Kent had dropped by more than 16% since 2007 in Kent and by 8.8% in Medway.

Cllr Vince Maple, Medway Labour Group Leader, said the party had a “fully-costed plan” to end the public sector pay freeze.

“Labour has a fully costed plan to end the public sector pay freeze. We would also introduce a £10 an hour living wage to address the fact that many people in work are still forced to visit food banks to make ends meet.”

“If we truly value loyal public servants the best way to show it is to pay them properly.”

Unison’s Tania Earnshaw, Secretary of the Medway Towns Local Government

Branch, said: “Dedicated staff have had years of pay restraint, of no increments and for many only a 0.6% pay rise. Now Medway is finding that to recruit new staff it is having to offer higher pay. That is because elsewhere – even under these restraints – pay has moved on, leaving Medway and its committed staff behind.”

More than 64% of a public sector workers’ pay was spent in the local economy, so the impact of pay restraint was much wider than the simple impact of it on staff, she added.

Clr Jarrett said: “You have to wonder why Labour is raising this now because this is the same pay award as last year. In fact, you would have thought they would encourage it because it rewards people lower down the pay scale.”

On the question of relaxing the cap, he said: “Everything comes with a cost and my worry is that one person’s pay rise is another person’s redundancy. We have stood by our staff as far as we can. If there is a move nationally, then we would take a look at it but the most important thing is to make sure staff have jobs.”