Boris Johnson’s “seismic” Whitehall reforms, including regular exams for senior civil servants, could lead to discrimination against staff on the grounds of their age and ethnicity, a leading union has claimed.

The union Prospect said a previous attempt to test staff’s skills resulted in a £1m payout to civil servants after legal counsel alleged that success rates for black and minority ethnic (BME) workers, or those older than 35, had been significantly lower than that of other employees.

It follows accusations that senior government officials are “woefully unprepared” for sweeping changes being prepared by the prime minister and his special adviser, Dominic Cummings.

Rachel Wolf, who helped to write Johnson’s election-winning manifesto, wrote on Wednesday that civil servants could be made to take regular exams to prove that they are up to their jobs and that changes would end the “merry-go-round” of officials changing jobs every 18 months.

This is in addition to a restructuring of Whitehall departments that was briefed by Downing Street sources last month.

Prospect’s deputy general secretary, Garry Graham, whose union represents government-employed specialists and scientists, said a previous test applied to Home Office staff before promotion was discriminatory.

“The idea of annual exams may be a good headline, but it risks putting the cart before the horse and introducing more bureaucracy and potential discrimination into the system,” he said.

In March, the government paid out £1m to 49 Home Office employees who had been told they would need to undertake a core skills assessment (CSA) if they were to be considered for promotion, which they all subsequently failed.

CSAs have been long criticised by unions that support Home Office staff, which say success rates for BME workers, or those older than 35, have been significantly lower than that of other employees.

Tribunal claims were initiated against the Home Office, which disputed the claims but agreed partway through the hearing, on 27 February, to settle, without admission of liability, and pay the claimants compensation totalling more than £1m.

Graham also questioned whether the new reforms announced by “diktat” will be successful without consultation of staff.

“Ultimately any civil service reform package stands the best chance of success if it is conceived together with civil servants, rather than issued by diktat from the centre,” he said.

In an article for the Daily Telegraph, Wolf stated that anyone staying in the same job for longer than 18 months is currently seen to have “stalled” in a culture that ensures “everyone rises to their position of incompetence”. She also predicts that civil servants will be “reoriented to the public” rather than “stakeholders”.

Dave Penman, the head of the FDA union, which represents Whitehall’s most senior civil servants, including permanent secretaries, pointed out that a new government claiming it will transform Whitehall is “nothing new and somewhat expected”.

“While painting the civil service as resistant to change might make a good headline, the reality is quite different and the idea that civil servants are rising ‘to their position of incompetence’ is so wide of the mark it demonstrates a fundamental misunderstanding.

“The so-called ‘merry-go-round’ that Wolf decries is entirely of the government’s own creation, with a decade of pay stagnation and the removal of pay progression leaving the movement between jobs as the only route to a pay rise,” he said.

Government sources have confirmed reports that Mark Sedwill, the cabinet secretary, is expected to oversee a powerful new business department as part of a slew of expected departmental changes after the UK leaves the EU on 31 January.

The Foreign Office is expected to absorb the Department for International Development, to align overseas aid with diplomatic goals. Officials say they could set up a new energy and climate change department.

Stephen Barclay’s Department for Exiting the European Union is expected to be closed down, with responsibility for negotiations over the UK’s future relationship with the EU being led by the Cabinet Office.

Cummings, credited with devising the Conservatives’ election strategy that swept Johnson to victory, has been a long-term critic of Whitehall. In a 2014 lecture, he complained that “almost no one is ever fired” in Whitehall and set out a “to-do list” he had drawn up in case “I ever manage to get control of No 10.”

Another possible change includes splitting off responsibility for the UK’s borders and immigration from the Home Office into a standalone department.