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National negotiations for Scotland's 43 further education colleges ended this week, with the major staff union warning of imminent industrial action.

The Employers' Association for Scottish Further Education Colleges has withdrawn from national bargaining following staff rejection of a pay and conditions offer which tied a pay award to a new deal in which some conditions would be negotiated locally.

John Sellars, chief executive of the Employers' Association, said he hoped staff would negotiate more reasonably at local level, since they would "own" the negotiations. But Jack Dale, further and higher education secretary of the Educational Institute of Scotland, predicted action in a number of branches given the union's opposition to any deterioration in the "Blue Book" conditions, drawn up when the colleges were run by the local authorities.

The Scottish Office has withheld 2 per cent of the colleges' grants until they introduce more flexible contracts, and is now seeking a declaration from college managements that they will introduce new and "significantly different" contracts for staff hired or promoted from this week.

Mr Dale said that while the CLA remained very unhappy that the employers felt it necessary to withdraw from national bargaining, and stressed that members had said they were not prepared to sacrifice conditions of service even for the principle of national negotiations, and would continue to resist any deterioration at branch level.

Mr Sellars said the Employers Association would have preferred a national framework for core conditions, but had to accept that the sector was so diverse that college bargaining would be geared to local needs. Some colleges were trying to negotiate a local recognition agreement before making a salary offer and outlining the changes they wished to see, while others would make a recognition agreement contingent on accepting a pay and conditions offer.