Clients of Triage, a key player in the Government's plan to pay private companies to move people from benefit into work, were referred to as 'LTB' - code for "lying, thieving bastards", a former employee alleges.
Linda Smith, who worked for Triage, which operates in Scotland and the north of England, told the BBC that the term was used to describe jobless and disabled clients, and that the company used a practice known as 'parking' to keep disabled people on their books.
Mrs Smith said that under the scheme firms can earn more money from taking on the disabled people as clients, but that once they are on the company's books staff are told to spend as little time as possible helping them find work.
"They would be put on telephone interviews... just to make sure that there was this contact made so they could tick a box to say, 'Yeah, they're still on the Work Programme'," Mrs Smith said.
The BBC claims that four other former Triage employees confirmed the use of the LTB code and told the BBC similar stories about clients on their books being 'parked'.
Tony Wilson, 34, from Middlesbrough was referred to the Work Programme through Triage in February 2012, told the BBC he believes he has been 'parked': "They haven't done a single thing to help me in any way," he said.
He also condemned the use of the LTB label allegedly given to those on long-term benefits: "That's offensive. It's unprofessional. It's - so many words I could say about that. It's just wrong."
In response to the allegations Triage said: "It is standard practice, particularly for those clients that are sick or who have otherwise been unable to attend, to telephone them to check on their progress and maintain contact. Triage's delivery structure of the Work Programme does not allow for 'parking'.
"The compliance requirements of the programme demand a frequency of contact and this together with our own commitment to excellence and meeting client needs means that 'parking' is not an option."
Triage also claimed that use of the term LTB was an isolated incident, adding: "This is not a phraseology used or accepted by Triage."
Panorama: The Great Disability Scam? is on BBC One, Monday, 28 January at 20:30 GMT and then available in the UK via the BBC iPlayer.