Virgin Media contractors earning more than £300 a day have been told to accept a 15 per cent cut in rates or leave the company.

Virgin lopped ten per cent off day rates last year - when such a policy was widespread and usually spun as a way to avoid job cuts. But with the first signs of economic improvement many contractors felt the market was starting to improve.

The cuts will bite from 5 April and will hit 400 staff. They've been rumoured for some time on contractor message boards.

A spokesman for Virgin Media said: "We regularly review the arrangements we have with suppliers to ensure we are getting the best value from these relationships."

Cutting contractor rates was a common strategy for dealing with the recession, especially for financial firms. ®