Close to 4,000 NHS staff who were given redundancy pay-offs have been rehired, figures released in Parliament show.
Some managers were given payers worth as much as £650,000 at trusts, where around 21,100 staff were made redundant.
The government claimed this would free up money for patient care.
However, since May 2010, 2,570 staff have been rehired in permanent jobs, and 1,380 have been taken back on fixed-term contracts.
Shadow Health Secretary Andy Burnham said: "It’s clear that people who received pay-offs are now coming back to the NHS in ever greater numbers. It will be utterly galling for nurses who’ve just had a pay cut from David Cameron to see he’s been handing out cheques like confetti to people who have now been rehired.
"On his watch, we have seen pay-offs for [hospital] managers and pay cuts for nurses. Cameron's top-down re-organisation has wasted £3 billion and left the NHS in a weak financial position. Nurses are paying the price for his mismanagement of the NHS"
Health minister Dr Dan Poulter said: ‘By reducing managers and administrators by over 21,100, we are freeing up extra resources for patient care - £5.5 billion in this Parliament and £1.5 billion every year thereafter.’
Non-clinical staff have received average pay-offs of £43,000 but 2,300 received six-figure deals.
Dr Peter Carter, chief executive of the Royal College of Nurses said the revelation is an "insult to the hard-working nurses" who were told last week that there is not enough money for a pay uplift.
He said: "This news debunks the government’s claim that the NHS cannot afford to pay its frontline staff a fair wage and also maintain safe staffing levels. We have said time and time again that the NHS should be looking at reducing the many examples of wasteful spending before it starts making cuts which will damage staff morale and harm patient care.
"This will simply serve to further demoralise an already over-stretched workforce, at a time when trusts are already struggling to recruit and retain staff, and ultimately this is bad news for patient care.”