The chief executive of Sheffield council faces having his job axed or his responsibilities diminished if voters in the city opt for a powerful elected mayor.
Government officials have confirmed new, directly-elected mayors will become the most senior officers on their councils, responsible for staffing.
Sheffield's chief executive John Mothersole is one of a string of council chiefs who have so far defied a government order to take a five per cent pay cut.
His salary is 184,585.
The government is planning to lay an order in Parliament later this year which will turn the leader of Sheffield Council, as well as the leaders of 11 other cities, into so-called "shadow mayors".
The shadow mayors will rule until May 2012, when a referendum will be held to decide whether the mayor model of local government should continue.
For areas that vote in favour, mayoral elections would be held in May 2013.
Now it has emerged the newly-elected mayors will assume much of the work of the current chief executives.
Responsibilities would include the co-ordination of the council's different functions, staffing levels and structures.
A Department for Communities and Local Government spokesman said: "Mayors will move to the mayoral management model and ensure their mayor is their chief executive officer".
Meanwhile, an analysis by the Local Government Chronicle claims England's 12 core cities could have to pay more than 3m in redundancy costs if executive mayors are created and council chief executives are axed.
Denis Cooper, associate at law firm Eversheds, predicted outgoing chief executives would receive compensation of between a year and 18-months' salary.
"You will end up with lots of expensive payouts to chief executives that can't work under these arrangements," he said.
Liberal Democrats in Sheffield are opposed to the government's plans.
Deputy council leader Coun David Baker has said the system "causes more problems than it solves".
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