The main public servants' union has urged staff not to cave in to the Abbott government's threats as a wage freeze takes hold across the bureaucracy.
Almost all federal public servants' workplace agreements expired last week, which means strikes and other forms of industrial action are now a legal option available to staff.
Pay negotiations in most agencies are far behind schedule and the government has previously ruled out back pay.
The Community and Public Sector Union says the government is using the job losses projected in the May budget as an "industrial weapon" to "soften people up for substandard agreements".
"This is an attempt to fool APS workers into accepting agreements that strip critical rights at the same time as 16,500 jobs are being cut. We say don't believe the hype," the union told members.
The union also reminded public servants that, as their wage agreements had expired, they could now consider taking industrial action "to pressure their employer to make a better offer".
Federal Employment Minister Eriz Abetz told bureaucrats last week that pay rises would come at the cost of jobs.
"Some public servants have said to me that, as individuals – and whether they're representative or not I have no idea – they'd be happy to forgo a pay rise to save their mates' jobs," he said.
"If that were to be part of the public service culture, I'm sure that would be very helpful for workplace harmony and for the preservation of public service jobs."
The bureaucracy has recently proposed changes to staff agreements that would reduce job security, increase working hours and cut leave.
The government has also said it will allow pay increases only if they are offset by savings elsewhere.
However, while public servants will save about $600 million this financial year through the so-called "efficiency dividend" – an annual cut to administrative budgets – the government will not allow them to count these savings as productivity gains.
The union told its members: "We say that is unfair and out of step with modern workplace relations."
Federal public servants' pay showed signs of stagnating last year. The median salary rose by 3 per cent, the second-smallest increase in a decade.