Unionised journalists at News Corp Australia have agreed to an 11th-hour offer of a small pay rise in return for a cap on redundancy payments to high earners before a major restructure, which is to be announced within hours.

Guardian Australia understands that the publisher of the Australian, news.com.au and a host of tabloids across the country, including the Daily Telegraph and the Herald Sun, will hold a town hall meeting on Wednesday to unveil changes to how the company operates.

Staff have been invited to a “team strategy meeting” at 11am, sources said.

The restructure is not expected to involve mass redundancies of the company’s 1,000 journalists but to target middle management as the media giant centralises its news gathering.

Sources say some middle managers have already lost their jobs before their departments are dismantled as executives look to streamline operations.

Lachlan Murdoch was joined in Sydney last week by the News Corp UK boss, Rebekah Brooks, and the company’s global chief, Robert Thomson.

Murdoch became the sole chair of News Corp last year when Rupert Murdoch stepped down. Lachlan spends half of his time in Sydney and is also the chairman of Fox Corporation.

The cuts are being made because of a downturn in the advertising market and declining revenue from social media platforms.

Facebook and Instagram’s parent company, Meta, said it would not be renewing three-year content deals struck with News Corp under Australia’s news media bargaining code.

Meta has said it would stop paying all Australian publishers for news and planned to shut down its news tab in Australia and the US.

The Media Arts and Entertainment Alliance said unionised staff at News Corp Australia had accepted a 12-month extension of their enterprise bargaining agreement with a pay rise of 3.5%, contingent on a cap on redundancy payouts of $399,500.

The company offered a 3% pay rise with no changes to conditions or a 3.5% pay rise with the redundancy cap. Members accepted the second option because only a handful of union members were earning enough to be affected.

“The cap on redundancy would affect a staff member on the equivalent of Grade 10 with a 20% margin who has been at News Corp more than 25 years,” the MEAA told staff.

“However, those affected could look to secure 12 months pay as their redundancy as per the News Corp policy or the capped amount, whichever is greater.”

The agreement will now be voted on by all journalists – unionised and non-unionised – and is expected to be endorsed.

News Corp’s local media assets, a division that includes its flagship newspaper the Australian, have been going through a period of prolonged weakness.

Revenue in that division fell 10% in the March quarter, driven by lower print and digital advertising income, even as the overall number of digital subscribers increased.

The financial weakness is also evident in News Corp’s UK newspapers, which is in keeping with a broad pullback experienced across the media sector, driven by advertisers reducing their spending during a period of heightened business costs due to inflation.

Traditional mastheads have also come under pressure from online-only publications attracting advertising that would have typically gone to the major papers.

One of News Corp’s most prized Australian assets is not a publisher or broadcaster but the online real estate company REA Group, which has enjoyed strong property listings and rising revenues on the back of a robust property market.

The performance of its subscription video services unit is mixed. The sports-focused Kayo and the streaming service Binge have been increasing paid subscribers while the more expensive traditional Foxtel service has been losing customers.

The US-listed media conglomerate owns mastheads in the US, the UK and Australia, with a newspaper stable that includes the Sun and the Times in London and the New York Post. It also runs the profitable Dow Jones unit that includes the Wall Street Journal.

News Corp has long said that it sees opportunities ahead as it expands the use of cost-saving AI-produced content. It has just signed a deal with Open AI that gives the ChatGPT developer access to current and archived content from all of News Corp’s publications.