A college principal who gave lecturers a personal assurance they would not have to sign new contracts later went back on his word - and threatened to sack them, an industrial tribunal heard.

Graham Baskerville told the 18 staff at Chippenham College in Wiltshire he respected their wish to remain on old local authority-style Silver Book terms and promised them “there would not be any pressure” to change their minds. Fourteen months later, he issued the lecturers with an ultimatum to accept longer working hours and shorter holidays or face dismissal.

Mr Baskerville also produced “bogus” budgetary arguments to justify his demand, claiming the measure would save Pounds 19,000 a year when the true amount was less than Pounds 9,000, it was claimed. Two lecturers who rejected the ultimatum and lost their jobs - Tony Marsh and Paul Sengebush - are claiming unfair dismissal. Five others who say they signed under duress claim constructive unfair dismissal.

Chippenham College argues that the five who signed contracts agreed the new terms of employment and were not in law dismissed because no date was given for the termination of their employment. In the cases of Mr Marsh and Mr Sengebush, it maintains there were “sound business reasons” for its actions based on its financial position, the impact of reorganisation and government pressure to increase productivity.

The appeal is widely seen as a pivotal case for further education lecturers who have resisted widespread moves for three years to scrap pre-incorporation terms of employment in place under the local education authorities’ Silver Book regulations.

Virtually every college principal and NATFHE branch official in the land is looking to the outcome of the tribunal to back their case on the new contracts.

Defeat would also be a personal embarrassment to Mr Baskerville, who chairs the Colleges’ Employers’ Forum’s pay negotiating team and is a former chairman of the contracts committee.

The three-day hearing in Bristol was told the dispute arose from the introduction of flexible contracts committing academic staff to a 37-hour week and 35 days leave, in place of 63 days allowed under the Silver Book.

Management reserved the right to vary the terms without consultation. Mr Baskerville told the panel that, in common with many other institutions, Chippenham believed Silver Book contracts “posed a real threat to the future viability of the college”.

With colleges paid by results, new working arrangements were essential to compete for business. In February 1994, following the breakdown of national negotiations with NATFHE, staff were offered a 2.9 per cent pay rise, an earlier salary review date and a Pounds 500 lump sum, if they signed new contracts by the end of term.

All but 18 of the college’s 105 academic staff accepted the deal. Mr Baskerville admitted writing to the “refuseniks” in April 1994 saying he was prepared to accept their decision, but denied the assurance represented a lasting guarantee. He told the tribunal that in the next 12 months the college’s finances deteriorated to the point that it needed to save Pounds 395,000 from a budget of Pounds 4.5 million in the financial year 1995-6.

A package of cuts were introduced but when these failed to balance the books, the Silver Book staff were again asked to accept new contracts.

In a letter Mr Baskerville warned them: “You cannot afford to be regarded as yesterday’s person, frozen in time. Financially it is suicide to remain on a 1993 salary, seriously affecting your future pay and pension and career development. Worse still, just as sections of the college face closure if we do not keep up with the times, you too could be a party to the process of decline with inevitable and tragic results for you and yours.”

In June last year the board agreed to issue dismissal threats to staff who did not sign new contracts by the end of term. Mr Baskerville claimed Silver Book lecturers were “not contributing to the massive effort demanded of other staff” and were undermining morale.

All but seven lecturers eventually gave in. On NATFHE advice, five tried to sign while making it clear they were under duress. When Mr Baskerville refused to allow such caveats, they signed anyway. In a memo in July he said the Silver Book staff had been jeopardising the college’s success and urged college managers to have “no sympathy” for them.

Under cross-examination, Mr Baskerville admitted that transferring the 18 lecturers to new contracts would save just Pounds 9,000 - a “minuscule amount” that could not justify the dismissals, according to Michael Supperstone QC, representing the seven staff.

Mr Baskerville denied he wanted all staff on new contracts because it would be “a feather in his cap”, insisting: “It was the final straw. Small figures count. It was not just the Pounds 9,000, it was very important to have them on board.”

Giving evidence, the lecturers insisted they were prepared to work flexibly whenever required, in excess of their Silver Book contracts and without overtime pay. They denied undermining morale, claiming colleagues were demoralised by the upheaval at the college. They had taken Mr Baskerville’s assurance to be the end of dispute; the dismissal ultimatum was “like a bolt out of the blue”.

Engineering lecturer Chris Hall told how one summer he was asked to hand out leaflets advertising college courses in a shopping mall. He agreed, even though he used to spend the holiday catching up on the latest computer programmes in time for next year. He felt the new contracts were “too open-ended and could lead to me being exploited”.

Mr Sengebush, the NATFHE branch chairman, said he also worked in excess of his Silver Book hours. However, after the deadline to sign had passed he did not go into college during the 1995 summer holiday as a “personal sanction”. He claimed the Chippenham dispute was exacerbated by Mr Baskerville’s involvement in the national talks on behalf of the College Employers’ Forum. “He was not prepared to compromise at local level because there was a lot of face to lose.”

Mr Baskerville told the tribunal he suspected NATFHE members at Chippenham were “under the direction of the national office”. Cross-examined by Jeremy McMullen QC, for the college, the lecturers conceded that remaining on Silver Book contracts allowed them to refuse to work during the summer, if they ever wanted to.

Mr McMullen argued that correspondence between NATFHE and Mr Baskerville concerning summer work indicated that, despite Mr Baskerville’s earlier assurance, the contract issue had not been settled. He said the college had exhausted the consultative processes, and had acted reasonably at all times. The panel’s ruling is expected in a few weeks.